<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 13, 1994
REGISTRATION NOS. 33-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
THE UNITED ILLUMINATING COMPANY UNITED CAPITAL FUNDING PARTNERSHIP L.P.
(EXACT NAME OF REGISTRANT AS (EXACT NAME OF REGISTRANT AS SPECIFIED
SPECIFIED IN ITS CHARTER) IN ITS CHARTER)
CONNECTICUT DELAWARE
(STATE OR OTHER JURISDICTION OF (STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION) INCORPORATION OR ORGANIZATION)
06-0571640 06-1404034
(I.R.S. EMPLOYER IDENTIFICATION NO.) (I.R.S. EMPLOYER IDENTIFICATION NO.)
157 CHURCH STREET 157 CHURCH STREET
NEW HAVEN, CONNECTICUT 06506-0901 NEW HAVEN, CONNECTICUT 06506-0901
(203) 499-2000 (203) 499-2000
(ADDRESS, INCLUDING ZIP CODE AND (ADDRESS, INCLUDING ZIP CODE AND
TELEPHONE NUMBER, INCLUDING AREA CODE, TELEPHONE NUMBER, INCLUDING AREA CODE,
OF PRINCIPAL EXECUTIVE OFFICES) OF PRINCIPAL EXECUTIVE OFFICES)
---------------
RICHARD J. GROSSI
CHIEF EXECUTIVE OFFICER
THE UNITED ILLUMINATING COMPANY
157 CHURCH STREET
NEW HAVEN, CONNECTICUT 06506-0901
(203) 499-2000
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
COPIES TO:
WILLIAM C. BASKIN, JR., ESQ. DAVID P. FALCK, ESQ.
WIGGIN & DANA ONE WINTHROP, STIMSON, PUTNAM & ROBERTS
CENTURY TOWER NEW ONE BATTERY PARK PLAZA
HAVEN, CT 06508-1832 NEW YORK, NY 10004-1490
---------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement as determined
by market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, 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]
===============================================================================
<TABLE>
<CAPTION>
PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED(1) PER UNIT(1)(2) PRICE(1)(2) FEE(3)
- - - -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
United Capital Funding
Partnership L.P.
limited partner
interests..............
- ---------------------------------------------------------------------------------------
The United Illuminating
Company Junior
Subordinated Deferrable
Interest Debentures....
- ---------------------------------------------------------------------------------------
The United Illuminating
Company Guarantee with
respect to United
Capital Funding
Partnership L.P.
limited partner
interests(4)........... -- -- -- --
- ---------------------------------------------------------------------------------------
Total................... $100,000,000 100% $100,000,000 $34,483
</TABLE>
===============================================================================
(1) There are being registered hereunder limited partner interests of United
Capital Funding Partnership L.P. and Junior Subordinated Deferrable
Interest Debentures of The United Illuminating Company (which may be
distributed upon the occurrence of certain events relating to United
Capital Funding Partnership L.P., for which no separate consideration will
be received, or separately issued to the public or institutional
investors) with an aggregate initial offering price not to exceed
$100,000,000. Pursuant to General Instruction II.D. of Form S-3 under the
Securities Act of 1933, the accompanying table does not specify by each
class information as to the amount to be registered, proposed maximum
offering price per unit or proposed maximum aggregate offering price.
(2) Estimated solely for the purpose of determining the registration fee and
exclusive of accrued interest and distributions, if any.
(3) The amount of the registration fee has been calculated in accordance with
rule 457(o) under the Securities Act of 1933.
(4) No separate consideration will be received for The United Illuminating
Company Guarantee.
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
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, as amended, or until this
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
===============================================================================
<PAGE>
EXPLANATORY NOTE
This Registration Statement contains two forms of Prospectus Supplement to
the Prospectus included herein: the first form is to be used in connection with
an offering by The United Illuminating Company of Junior Subordinated
Deferrable Interest Debentures and the second form is to be used in connection
with an offering by United Capital Funding Partnership L.P. of Preferred
Capital Securities.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+ REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+ SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+ OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+ BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER +
+ TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE +
+ OF THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR +
+ SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE +
+ SECURITIES LAWS OF ANY SUCH JURISDICTION. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS SUPPLEMENT (Subject to Completion, Issued , 1994)
(To Prospectus dated , 1994)
$100,000,000
The United Illuminating Company
% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES, SERIES A, DUE 20
------------
Interest payable
------------
THE % JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES, SERIES A, DUE 20 (THE
"SERIES A DEBENTURES") ARE REDEEMABLE, AT THE OPTION OF THE UNITED ILLUMINATING
COMPANY ("UI"), IN WHOLE OR IN PART, FROM TIME TO TIME, ON OR AFTER ,
, AT THE REDEMPTION PRICES SET FORTH HEREIN. SEE "CERTAIN TERMS OF THE
SERIES A DEBENTURES--REDEMPTION" HEREIN. THE SERIES A DEBENTURES WILL RANK
SUBORDINATE IN RIGHT OF PAYMENT TO ALL SENIOR INDEBTEDNESS (AS DEFINED IN THE
ACCOMPANYING PROSPECTUS) OF UI. AS OF JUNE 30, 1994, UI HAD APPROXIMATELY $1,006
MILLION OF SENIOR INDEBTEDNESS OUTSTANDING. SEE "DESCRIPTION OF THE DEBENTURES
AND THE INDENTURE--SUBORDINATION" IN THE ACCOMPANYING PROSPECTUS.
------------
UI has the right, from time to time, to extend interest payment periods on
the Series A Debentures for up to 60 consecutive months. During any such
extended interest payment period, UI may not declare or pay dividends on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any
shares of its capital stock. UI currently has no intention to so extend any
such interest payment period. See "Description of the Debentures and the
Indenture--Option to Extend Interest Payment Period" in the accompanying
Prospectus.
The Series A Debentures will be represented by a global debenture registered
in the name of a nominee of The Depository Trust Company (the "Depositary").
Interests in such global debenture will be shown on, and transfers thereof will
be effected only through, records maintained by the Depositary and its
participants. Except as described herein, Series A Debentures in definitive
form will not be issued. See "Description of the Debentures and the Indenture--
Book-Entry System and Settlement" in the accompanying Prospectus.
------------
SEE "CERTAIN INVESTMENT CONSIDERATIONS" FOR CERTAIN FACTORS THAT SHOULD BE
CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SERIES A DEBENTURES,
INCLUDING THE PERIOD AND CIRCUMSTANCES DURING AND UNDER WHICH INTEREST ON THE
SERIES A DEBENTURES MAY BE DEFERRED.
------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------
PRICE % AND ACCRUED INTEREST, IF ANY
------------
<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC (1) COMMISSIONS (2) UI (1)(3)
---------- --------------- -----------
<S> <C> <C> <C>
Per Debenture.......................... % % %
Total.................................. $ $ $
</TABLE>
- ----------
(1) Plus accrued interest, if any, from , 1994.
(2) UI has agreed to indemnify the Underwriters against liabilities,
including liabilities under the Securities Act of 1933, as amended.
(3) Before deduction of expenses payable by UI estimated at $ .
------------
The Series A Debentures are offered subject to prior sale, when, as and if
accepted by the Underwriters and subject to approval of certain legal matters
by Winthrop, Stimson, Putnam & Roberts, counsel for the Underwriters. It is
expected that delivery of the Series A Debentures will be made on or about
, 1994 through the book-entry facilities of the Depositary, against
payment therefor in New York funds.
------------
MORGAN STANLEY & CO.
Incorporated
, 1994
<PAGE>
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS, IN CONNECTION WITH THE
OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY UI OR THE UNDERWRITERS. THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN OFFER OR
SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER
OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE
ACCOMPANYING PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF UI SINCE THE DATE HEREOF.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
----------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<S> <C>
Certain Investment Considerations........................................... S-3
The United Illuminating Company............................................. S-3
Summary Financial Information............................................... S-4
Use of Proceeds............................................................. S-5
Certain Terms of the Series A Debentures.................................... S-5
United States Income Taxation............................................... S-6
Underwriting................................................................ S-8
</TABLE>
PROSPECTUS
<TABLE>
<S> <C>
Available Information....................................................... 2
Incorporation of Certain Documents by Reference............................. 2
The United Illuminating Company............................................. 3
United Capital Funding Partnership L.P. .................................... 3
Use of Proceeds............................................................. 3
UI Earnings Ratios.......................................................... 4
Description of the Preferred Capital Securities............................. 4
Description of the Guarantee................................................ 15
Description of the Debentures and the Indenture............................. 17
Plan of Distribution........................................................ 26
Legal Opinions.............................................................. 27
Experts..................................................................... 27
</TABLE>
S-2
<PAGE>
CERTAIN INVESTMENT CONSIDERATIONS
Prospective purchasers of the Series A Debentures should carefully review the
information contained in the accompanying Prospectus, including the documents
incorporated by reference therein, and elsewhere in this Prospectus Supplement
and should particularly consider the following matters. Capitalized terms used
in this Prospectus Supplement shall have the meanings ascribed thereto in the
accompanying Prospectus unless otherwise defined in this Prospectus Supplement.
SUBORDINATION OF SERIES A DEBENTURES
UI's obligations under the Series A Debentures will be subordinate in right
of payment to all Senior Indebtedness of UI. As of June 30, 1994, UI had
approximately $1,006 million of Senior Indebtedness outstanding (exclusive of
certain guarantees and other contingent obligations, but inclusive of
capitalized lease obligations and current installments and short-term notes
payable). For a description of the terms of this subordination, see
"Description of the Debentures and the Indenture--Subordination" in the
accompanying Prospectus. There are no provisions in the Indenture (as defined
herein) that limit UI's ability to incur additional indebtedness, including
indebtedness that ranks senior to the Series A Debentures.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
UI has the right under the Indenture, from time to time, to extend interest
payment periods on the Series A Debentures for up to 60 consecutive months.
During any such extended interest payment period, UI may not declare or pay
dividends on, or redeem, purchase, acquire or make a liquidation payment with
respect to, any shares of its capital stock. UI currently has no intention to
so extend any such interest payment period, and it believes that such an
extension of an interest payment period is unlikely. See "Description of the
Debentures and the Indenture--Option to Extend Interest Payment Period" in the
accompanying Prospectus.
TAX CONSEQUENCES OF EXTENDED INTEREST PAYMENT PERIOD
Should an extended interest payment period occur, record holders of Series A
Debentures will continue to accrue income for United States Federal income tax
purposes even though interest is not being paid on a current basis. As a
result, such holders will include such interest in gross income for Federal
income tax purposes in advance of the receipt of cash, and will not receive the
cash related to such income if such holders dispose of the Series A Debentures
prior to the record date for payment of interest. A holder's tax basis in the
Series A Debentures will be increased by the amount of any interest that is
included in such holder's income without receipt of cash, and will be decreased
when and if such cash is subsequently received by such Series A Debenture
holder from UI. See "United States Income Taxation--United States Holders"
herein.
THE UNITED ILLUMINATING COMPANY
UI is an operating electric public utility company, incorporated under the
laws of the State of Connecticut in 1899. It is engaged principally in the
production, purchase, transmission, distribution and sale of electricity for
residential, commercial and industrial purposes in a service area of about 335
square miles in the southwestern part of the State of Connecticut. The
population of this area is approximately 698,000, or 21% of the population of
the State of Connecticut. The service area, largely urban and suburban in
character, includes the principal cities of Bridgeport (population 135,250) and
New Haven (population 123,470) and their surrounding areas. Situated in the
service area are retail trade and service centers, as well as large and small
industries providing a wide variety of products, including helicopters and
other transportation equipment, electrical equipment, chemicals and
pharmaceuticals. Of UI's 1993 retail electric revenues, approximately 39% were
derived from residential sales, 43% from commercial sales, 16% from industrial
sales and 2% from other sales.
S-3
<PAGE>
UI has four wholly-owned direct subsidiaries. Bridgeport Electric Company, a
single-purpose corporation, owns and leases to UI a generating unit at
Bridgeport Harbor Station. Research Center, Inc. has been formed to participate
in the development of one or more regulated power production ventures,
including possible participation in arrangements for the future development of
independent power production and cogeneration facilities. United Energy
International, Inc. has been formed to facilitate participation in a proposed
joint venture relating to power production plants abroad. United Resources,
Inc. ("URI") serves as the parent corporation for UI's unregulated businesses,
each of which is incorporated separately to participate in business ventures
that will complement and enhance UI's electric utility business and serve the
interests of UI and its shareholders and customers.
Four wholly-owned subsidiaries of URI have been incorporated. Souwestcon
Properties, Inc. is participating as a 25% partner in the ownership of a
medical hotel building in New Haven. A second wholly-owned subsidiary of URI is
Thermal Energies, Inc., which is participating in the development of district
heating and cooling water facilities in the downtown New Haven area, including
the energy center for an office tower and participation as a 37% partner in the
energy center for a city hall and office tower complex. A third URI subsidiary,
Precision Power, Inc., provides power-related equipment and services to the
owners of commercial buildings and industrial facilities. A fourth URI
subsidiary, American Payment Systems, Inc., manages equipment for electronic
data processing of bill payments made by customers of utilities, including UI,
at neighborhood businesses. In addition to these subsidiaries, URI has an 82%
ownership interest in Ventana Corporation, which offers energy conservation
engineering and project management services to governmental and private
institutions. The Board of Directors of UI has authorized the investment of a
maximum of $18.0 million, in the aggregate, of UI's assets in all of these URI
ventures and, at June 30, 1994, approximately $13.5 million had been so
invested.
UI has ownership and leasehold interests in three nuclear generating units
located in New England, including a 17.5% undivided ownership and leasehold
interest in Seabrook Unit 1, a 1,150-megawatt unit in Seabrook, New Hampshire
("Seabrook 1").
For further information about these and other matters affecting UI's
business, see "Incorporation of Certain Documents by Reference" in the
accompanying Prospectus.
SUMMARY FINANCIAL INFORMATION
The following material, which is presented herein solely to furnish limited
financial information regarding UI, is qualified in its entirety by reference
to the detailed information and financial statements contained in the
Incorporated Documents (as defined in the accompanying Prospectus) and
available upon request from UI. See "Available Information" in the accompanying
Prospectus. Accordingly, the following should be read together with the
Incorporated Documents.
<TABLE>
<CAPTION>
SIX MONTHS ENDED TWELVE MONTHS ENDED DECEMBER 31,
JUNE 30, 1994 --------------------------------
(UNAUDITED) 1993 1992 1991
---------------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Operating Revenues........... $321,012 $653,023 $667,325 $673,371
Operating Income............. 59,258 114,814 108,022 103,200
Total Allowance for Funds
Used During Construction(1). 1,944 4,067 3,232 5,190
Deferred Return(2)........... -- 7,497 15,959 17,970
Total Interest Charges....... 42,157 92,290 101,548 100,143
Net Income................... 18,352 40,481 56,768 55,550
</TABLE>
S-4
<PAGE>
<TABLE>
<CAPTION>
AS OF JUNE 30, 1994
-----------------------------------------------------
ACTUAL AS ADJUSTED(3)
-------------------------- --------------------------
AMOUNT PERCENT OF AMOUNT PERCENT OF
(UNAUDITED) CAPITALIZATION (UNAUDITED) CAPITALIZATION
----------- -------------- ----------- --------------
<S> <C> <C> <C> <C>
CAPITALIZATION:
Long-Term Debt (including
current maturities)..... $ 958,341 67.3% $ 889,316 62.3%
Junior Subordinated
Debentures.............. -- -- 100,000 7.0
Preferred Stock.......... 45,945 3.2 18,445 1.3
Common Stock Equity...... 420,520 29.5 420,520 29.4
---------- ----- ---------- -----
Total Capitalization..... $1,424,806 100.0% $1,428,281 100.0%
========== ===== ========== =====
</TABLE>
- ------------
(1) Allowance for Funds Used During Construction ("AFUDC") is a non-cash
credit to income that represents the approximate cost of debt and equity
capital devoted to plant under construction. For balance sheet purposes,
AFUDC is capitalized to UI's Plant account and depreciated and recovered
over the life of the asset.
(2) Deferred Return is a non-cash credit to income that represents the
approximate cost of debt and equity capital devoted to the portion of
Seabrook 1 that is presently excluded from rate base in accordance with
the phase-in to rate base of UI's investment in Seabrook 1 over a five-
year period beginning in 1995. For balance sheet purposes, Deferred Return
is capitalized as a deferred debit and amortized and recovered over a
five-year period.
(3) Adjusted to give effect to the issuance of $100,000,000 aggregate
principal amount of the Series A Debentures, and the assumed use of the
net proceeds thereof to redeem outstanding preferred stock and repay
maturing long-term debt. See "Use of Proceeds."
USE OF PROCEEDS
UI intends to apply the proceeds from the sale of the Series A Debentures to
the payment or provision for payment at maturity or the purchase (on the open
market, in private transactions or otherwise) or redemption of outstanding
securities of UI and for general corporate purposes.
CERTAIN TERMS OF THE SERIES A DEBENTURES
The following summary of certain terms and provisions of the Series A
Debentures supplements the description of the Debentures, including the terms
of subordination thereof, set forth in the accompanying Prospectus under the
heading "Description of the Debentures and the Indenture," to which
description reference is hereby made.
GENERAL
The Series A Debentures will be issued as a series of Debentures under the
Indenture dated , 1994 between UI and The Bank of New York, as trustee (as
supplemented from time to time, the "Indenture"). The Series A Debentures will
be limited in aggregate principal amount to $ million.
The entire principal amount of the Series A Debentures will become due and
payable, together with any accrued and unpaid interest thereon, if any, on
, 20 (subject to UI's rights to redeem the Series A Debentures). See
"Redemption" below.
INTEREST
The Series A Debentures will bear interest at a rate of % per annum from
, 1994 until paid. Such interest will be payable ,
commencing , 1994, to the holders of record at the close of business on the
preceding , respectively. See "Description of the Debentures and
the Indenture--Interest" in the accompanying Prospectus.
S-5
<PAGE>
UI has the right, from time to time, to extend interest payment periods on
the Series A Debentures for up to 60 consecutive months. For a description of
UI's right to so extend interest payment periods, and the effect of any such
extension on its ability to declare and pay dividends on shares of its capital
stock, see "Description of the Debentures and the Indenture--Option to Extend
Interest Payment Period" in the accompanying Prospectus.
REDEMPTION
The Series A Debentures may be redeemed at the option of UI, at any time on
or after , , in whole or in part, upon not less than 30 nor more than 60
days' notice, at the respective redemption prices (expressed in percentages of
the principal amounts to be redeemed) during the twelve-month periods
commencing on of the years indicated:
<TABLE>
<CAPTION>
YEAR REDEMPTION PRICE
---- ----------------
<S> <C>
</TABLE>
plus any accrued but unpaid interest, if any, to the date fixed for redemption.
FORM AND DENOMINATION
The Series A Debentures will be issued only in registered form in
denominations of $ and integral multiples thereof.
UNITED STATES INCOME TAXATION
GENERAL
This section is a summary of certain United States Federal income tax
considerations that may be relevant to prospective purchasers of Series A
Debentures and represents the opinion of Reid & Priest, special tax counsel to
UI, insofar as it relates to matters of law and legal conclusions. This section
is based upon current provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), existing and proposed regulations thereunder and current
administrative rulings and court decisions, all of which are subject to change.
Subsequent changes may cause tax consequences to vary substantially from the
consequences described below.
No attempt has been made in the following discussion to comment on all
Federal income tax matters affecting purchasers of the Series A Debentures.
Moreover, the discussion focuses on holders of the Series A Debentures who are
individual citizens or residents of the United States and has only limited
application to corporations, estates, trusts and non-resident aliens.
Accordingly, each prospective purchaser of the Series A Debentures should
consult, and should depend upon, his or her own tax advisor in analyzing the
Federal, state, local and foreign income tax consequences of the purchase,
ownership or disposition of the Series A Debentures.
UNITED STATES HOLDERS
For purposes of this discussion, a "United States holder" is a beneficial
owner of Series A Debentures that is (i) a citizen or resident of the United
States, (ii) a domestic corporation or (iii) otherwise subject to United States
Federal income taxation on a net income basis in respect of such Series A
Debentures.
S-6
<PAGE>
Because the interest payment period is extendable, the interest on the Series
A Debentures will be treated as "original issue discount" pursuant to Code
sections 1271 et seq. and the Treasury Regulations promulgated thereunder.
Pursuant thereto, any United States holder will be required to include interest
on the Series A Debentures in taxable income as it accrues in accordance with a
constant yield method based upon a compounding of interest. This will be true
regardless of the method of accounting regularly used by such holder for tax
purposes and may result in the inclusion of interest in taxable income before
actual receipt of the cash payment representing such interest. This should
occur only during an extended interest payment period or any other period of
non-payment and may under certain circumstances also occur, if interest payment
periods on the Series A Debentures are longer than one month. The tax basis of
any United States holder in the Series A Debentures will generally equal the
amount paid for them increased by the amount of any accrued but unpaid
interest.
Upon a sale or retirement of the Series A Debentures, a United States holder
will generally recognize gain or loss in an amount equal to the difference
between (i) the amount realized by such holder from the sale or retirement of
such Series A Debentures and (ii) such holder's tax basis in such Series A
Debentures. Depending upon the particular circumstances of a holder, gain or
loss recognized by such holder on the sale or exchange of Series A Debentures
held for more than one year will generally be taxable as long-term capital gain
or loss.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien holder" is any holder
of Series A Debentures that is (i) a nonresident alien individual, (ii) a
foreign corporation or partnership or (iii) an estate or trust that has a
foreign fiduciary, in each case not subject to United States Federal income
taxation on a net income basis in respect of such Series A Debentures.
Under current Federal income tax law, subject to the discussion below with
respect to backup withholding:
(a) payments by UI or any of its paying agents in respect of a Series A
Debenture to a United States Alien holder will not be subject to Federal
withholding tax provided that (i) the beneficial owner of the Series A
Debentures does not actually or constructively own 10% or more of the total
combined voting power of all classes of stock of UI entitled to vote, (ii)
the beneficial owner of the Series A Debentures is not a controlled foreign
corporation that is related to UI through stock ownership and (iii) either
(A) the beneficial owner of the Series A Debentures certifies to UI or its
agent, under penalties of perjury, that it is a United States Alien holder
and provides its name and address or (B) the holder of the Series A
Debentures is a securities clearing organization, bank or other financial
institution that holds customers' securities in the ordinary course of its
trade or business (a "Financial Institution") and such holder certifies to
UI or its agent under penalties of perjury that such statement has been
received from the beneficial owner by it or by a Financial Institution
between it and the beneficial owner and furnishes UI or its agent with a
copy thereof; and
(b) a United States Alien holder will generally not be subject to Federal
income tax on any gain realized upon the sale or exchange of the Series A
Debentures unless such holder is an individual present in the United States
for 183 days or more in the taxable year of the sale and either has a "tax-
home" in the United States or certain other requirements are met.
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments to
noncorporate United States holders of payments of principal and interest on the
Series A Debentures and to the proceeds of the sale of the Series A Debentures
prior to maturity within the United States, and "backup withholding" at a rate
of 31% will apply to such payments if any such Series A Debenture holder fails
to provide an accurate taxpayer identification number or to report all interest
and dividends required to be shown on its Federal income tax returns.
S-7
<PAGE>
Information reporting and backup withholding will not apply to payments of
principal and interest on the Series A Debentures made by UI or a paying agent
to a United States Alien holder if the certification described in clause (iii)
of paragraph (a) under "United States Alien Holders" above is received,
provided that the payor does not have actual knowledge that the holder is a
United States holder.
Payments of the proceeds from the sale by a United States Alien holder of the
Series A Debentures made to or through a foreign office of a broker will not be
subject to information reporting or backup withholding. However, if the broker
is a United States person, a controlled foreign corporation for United States
Federal income tax purposes or a foreign person 50% or more of whose gross
income is effectively connected with a United States trade or business for a
specified three year period, information reporting may apply to such payments.
Payments of the proceeds from the sale of the Series A Debentures to or through
the United States office of a broker is subject to information reporting and
backup withholding unless the United States Alien holder or beneficial owner
certifies as to its non-United States status or otherwise establishes an
exemption from information reporting and backup withholding.
UNDERWRITING
Under the terms and subject to the conditions of an Underwriting Agreement
dated the date hereof (the "Underwriting Agreement"), UI has agreed to sell to
each of the Underwriters named below (the "Underwriters"), and each of the
Underwriters has severally agreed to purchase from UI, the respective principal
amounts of Series A Debentures set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
SERIES A
NAME DEBENTURES
---- ----------
<S> <C>
Morgan Stanley & Co. Incorporated................................... $
-----
Total............................................................. $
=====
</TABLE>
The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the Series A Debentures are
subject to the approval of certain legal matters by their counsel and to
certain other conditions. The Underwriters are committed to take and pay for
all such Series A Debentures offered hereby, if any are taken.
The Underwriters propose to offer all or part the Series A Debentures
directly to the public at the public offering price set forth on the cover page
hereof, and all or part to certain dealers at a price that represents a
concession not in excess of % of the principal amount of the Series A
Debentures. The Underwriters may allow, and such dealers may reallow, a
concession not in excess of % of the principal amount of the Series A
Debentures to certain other dealers. After the initial offering of the Series A
Debentures, the offering price and other selling terms may from time to time be
varied by the Underwriters.
Certain of the Underwriters engage in transactions with, and from time to
time have performed services for, UI in the ordinary course of business.
UI has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended, or to contribute with respect to payments that the Underwriters may be
required to make in respect thereof.
S-8
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+ REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+ SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+ OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+ BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER +
+ TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE +
+ THESE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR OF +
+ SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE +
+ SECURITIES LAWS OF ANY SUCH JURISDICTION. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS SUPPLEMENT (Subject to Completion, Issued , 1994)
(To Prospectus dated , 1994)
Preferred Securities
United Capital Funding Partnership L.P.
% Preferred Capital Securities, Series A
(Liquidation Preference $25 per Security)
Guaranteed to the extent set forth herein by
The United Illuminating Company
----------
The % Preferred Capital Securities, Series A (the "Series A Preferred
Capital Securities") offered hereby are being issued by, and represent limited
partner interests in, United Capital Funding Partnership L.P., a Delaware
special purpose limited partnership ("United Capital"). United Capital was
formed for the sole purpose of issuing its limited partner interests ("Limited
Partner Interests") and lending the proceeds thereof to The United Illuminating
Company ("UI"), which owns all of the general partner interests in United
Capital. The proceeds of the Series A Preferred Capital Securities, together
with the related capital contributions made by UI, will be loaned to UI in
return for % Junior Subordinated Deferrable Interest Debentures, Series A, Due
20 (the "Series A Debentures") issued by UI. The limited partner interests
represented by the Series A Preferred Capital Securities will have a preference
with respect to cash distributions ("dividends") and amounts payable on
liquidation over the general partner interests in United Capital.
Holders of the Series A Preferred Capital Securities will be entitled to
receive, to the extent of funds held by United Capital and legally available
therefor, cumulative preferential dividends, at an annual rate of % of the
liquidation preference of $25 per security, accruing from the date of original
issue and payable monthly in arrears on the last day of each calendar month of
each year, commencing , 1994. The payment of dividends and payments on
liquidation or redemption with respect to the Series A Preferred Capital
Securities, to the extent of funds held by United Capital and legally available
therefor, will be guaranteed under a Payment and Guarantee Agreement (the
"Guarantee") of UI to the extent described herein and in the accompanying
Prospectus. The Guarantee does not cover payment of amounts in respect of the
Series A Preferred Capital Securities to the extent that United Capital does
not have legally available funds for the payment thereof and cash on hand
sufficient to make such payment. Such funds and cash on hand will be limited to
payments by UI on the Series A Debentures and any other Indenture Securities
(as defined in the accompanying Prospectus) issued in connection with the
investment of the proceeds of any other offering of Limited Partner Interests.
If UI fails to make interest payments on the Series A Debentures or any other
such Indenture Securities, United Capital will have insufficient funds to pay
dividends on the Series A Preferred Capital Securities and the Guarantee will
not cover payment of such dividends. In such event, the holders of Series A
Preferred Capital Securities may enforce certain rights in respect of the
Series A Debentures. See "Description of the Guarantee" in the accompanying
Prospectus.
The Guarantee and the Series A Debentures will rank subordinate in right of
payment to all Senior Indebtedness (as defined in the accompanying Prospectus)
of UI. As of June 30, 1994, UI had approximately $1,006 million of Senior
Indebtedness outstanding. UI has the right, from time to time, to extend
interest payment periods on the Series A Debentures for up to 60 consecutive
months, and, as a consequence, monthly dividends on the Series A Preferred
Capital Securities will be deferred by United Capital during any such extended
interest payment period. During any such extended interest payment period, UI
may not declare or pay dividends on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any shares of its capital stock. UI
currently has no intention to so extend the interest payment period. See
"Description of the Debentures and the Indenture--Option to Extend Interest
Payment Period" and "Description of the Preferred Capital Securities--Voting
Rights" in the accompanying Prospectus.
The Series A Preferred Capital Securities are redeemable, at the option of
United Capital and at the direction of UI, in whole or in part, from time to
time, on or after , 1999, at a redemption price of $25 per security plus
accumulated and unpaid dividends, and any Additional Amounts (as defined in the
accompanying Prospectus) to the date fixed for redemption (the "Redemption
Price"). The Series A Preferred Capital Securities are also redeemable, at the
option of United Capital, in whole or in part, at the Redemption Price if at
any time United Capital or UI, as a consequence of certain events described
herein, is or would be required to pay certain additional amounts or to
withhold or deduct certain amounts. In addition, upon redemption or payment at
maturity of Series A Debentures, the proceeds from such redemption or payment
will be applied to redeem Series A Preferred Capital Securities at the
Redemption Price. Under certain circumstances following the occurrence of a
Special Event (as defined in the accompanying Prospectus), UI may cause United
Capital to redeem the Series A Preferred Capital Securities in whole at the
Redemption Price or to distribute the Series A Debentures in exchange for the
Series A Preferred Capital Securities in whole. If Series A Debentures are
distributed, UI will use its best efforts to have such Series A Debentures
listed on the same exchange on which the Series A Preferred Capital Securities
are then listed. See "Certain Terms of the Series A Preferred Capital
Securities--Redemption or Exchange" and "Certain Terms of the Series A
Debentures" herein.
In the event of the liquidation of United Capital, holders of Series A
Preferred Capital Securities will be entitled to receive for each security a
liquidation preference of $25 plus accumulated and unpaid dividends and any
Additional Amounts to the date of payment, subject to certain limitations. See
"Description of the Preferred Capital Securities--Liquidation Distribution" in
the accompanying Prospectus.
----------
SEE "CERTAIN INVESTMENT CONSIDERATIONS" FOR CERTAIN FACTORS THAT SHOULD BE
CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE SERIES A PREFERRED CAPITAL
SECURITIES, INCLUDING THE PERIOD AND CIRCUMSTANCES DURING AND UNDER WHICH
DIVIDENDS ON THE SERIES A PREFERRED CAPITAL SECURITIES AND INTEREST ON THE
SERIES A DEBENTURES MAY BE DEFERRED.
----------
APPLICATION WILL BE MADE TO LIST THE SERIES A PREFERRED CAPITAL SECURITIES 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 SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------
PRICE $25 PER SECURITY AND ACCRUED DIVIDENDS, IF ANY
----------
<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC (1) COMMISSIONS (2) UNITED CAPITAL (3)(4)
---------- --------------- ---------------------
<S> <C> <C> <C>
Per Security................... $ (3) $
Total.......................... $ (3) $
</TABLE>
- ---------
(1) Plus accrued dividends, if any, from the date of original issue.
(2) United Capital and UI have agreed to indemnify the several Underwriters
against certain liabilities, including liabilities under the Securities
Act of 1933, as amended. See "Underwriting."
(3) Because the proceeds of the sale of the Series A Preferred Capital
Securities will be loaned to UI, UI has agreed, in the Underwriting
Agreement, to pay the Underwriters as compensation for their services
$ per security (or $ in the aggregate); provided that such
compensation will be $ per security sold to certain institutions.
Therefore, to the extent that Series A Preferred Capital Securities are
sold to such institutions, the actual amount of such compensation will be
less than the aggregate amount specified in the preceding sentence. See
"Underwriting."
(4) Expenses of the offering, which are payable by UI, are estimated to be
$ .
----------
The Series A Preferred Capital Securities are offered subject to prior sale,
when, as and if accepted by the Underwriters and subject to approval of certain
legal matters by Winthrop, Stimson, Putnam & Roberts, counsel for the
Underwriters. It is expected that delivery of the Series A Preferred Capital
Securities will be made on or about , 1994 through the book-entry
facilities of The Depository Trust Company, against payment therefor in New
York funds.
----------
MORGAN STANLEY & CO.
Incorporated
, 1994
<PAGE>
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS, IN CONNECTION WITH THE
OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY UI, UNITED CAPITAL OR THE UNDERWRITERS. THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN
OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE
IN THE AFFAIRS OF UI OR UNITED CAPITAL SINCE THE DATE HEREOF.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Certain Investment Considerations.......................................... S-3
The United Illuminating Company............................................ S-4
United Capital Funding Partnership L.P. ................................... S-5
Summary Financial Information.............................................. S-6
Use of Proceeds............................................................ S-6
Certain Terms of the Series A Preferred Capital Securities................. S-7
Certain Terms of the Series A Debentures................................... S-7
United States Income Taxation.............................................. S-8
Underwriting............................................................... S-11
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The United Illuminating Company............................................ 3
United Capital Funding Partnership L.P. ................................... 3
Use of Proceeds............................................................ 3
UI Earnings Ratios......................................................... 4
Description of the Preferred Capital Securities............................ 4
Description of the Guarantee............................................... 15
Description of the Debentures and the Indenture............................ 17
Plan of Distribution....................................................... 26
Legal Opinions............................................................. 27
Experts.................................................................... 27
</TABLE>
S-2
<PAGE>
CERTAIN INVESTMENT CONSIDERATIONS
Prospective purchasers of the Series A Preferred Capital Securities should
carefully review the information contained in the accompanying Prospectus,
including the documents incorporated by reference therein, and elsewhere in
this Prospectus Supplement and should particularly consider the following
matters. Capitalized terms used in this Prospectus Supplement shall have the
meanings ascribed thereto in the accompanying Prospectus unless otherwise
defined in this Prospectus Supplement.
SUBORDINATION OF UI'S OBLIGATIONS
The payment of dividends and payments on liquidation or redemption with
respect to the Series A Preferred Capital Securities, to the extent of funds
held by United Capital and legally available to make such payments, will be
guaranteed by UI under the Guarantee. The Guarantee does not cover payment of
amounts in respect of the Series A Preferred Capital Securities to the extent
that United Capital does not have legally available funds for the payment
thereof and cash on hand sufficient to make such payment.
UI's obligations under the Guarantee and the Series A Debentures will be
subordinate in right of payment to all Senior Indebtedness of UI. As of June
30, 1994, UI had approximately $1,006 million of Senior Indebtedness
outstanding (exclusive of certain guarantees and other contingent obligations,
but inclusive of capitalized lease obligations and current installments and
short-term notes payable). For a description of the terms of the Guarantee and
this subordination, see "Description of the Guarantee--Status of Guarantee" and
"Description of the Debentures and the Indenture--Subordination," respectively,
in the accompanying Prospectus. There are no provisions in the Series A
Preferred Capital Securities, the Guarantee, the Partnership Agreement (as
defined herein) or the Indenture (as defined in the accompanying Prospectus)
that limit UI's ability to incur additional indebtedness, including
indebtedness that ranks senior to the Guarantee and the Series A Debentures.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
UI has the right under the Indenture, from time to time, to extend interest
payment periods on the Series A Debentures for up to 60 consecutive months,
and, as a consequence, monthly dividends on the Series A Preferred Capital
Securities will be deferred by United Capital during any such extended interest
payment period. During any such extended interest payment period, UI may not
declare or pay dividends on, or redeem, purchase, acquire or make a liquidation
payment with respect to, any shares of its capital stock. UI currently has no
intention to so extend any such interest payment period, and it believes that
such an extension of an interest payment period is unlikely. See "Description
of the Debentures and the Indenture--Option to Extend Interest Payment Period"
and "Description of the Preferred Capital Securities--Voting Rights" in the
accompanying Prospectus.
TAX CONSEQUENCES OF EXTENDED INTEREST PAYMENT PERIOD
Should an extended interest payment period occur, United Capital will
continue to accrue income for United States Federal income tax purposes that
will be allocated but not distributed to record holders of Series A Preferred
Capital Securities. As a result, such holders will include such interest in
gross income for Federal income tax purposes in advance of the receipt of cash,
and will not receive the cash related to such income if such holders dispose of
the Series A Preferred Capital Securities prior to the record date for payment
of dividends. A holder's tax basis in the Series A Preferred Capital Securities
will be increased by the amount of any interest that is included in such
holder's income without receipt of cash, and will be decreased when and if such
cash is subsequently received by such Series A Preferred Capital Securities
holder from United Capital. See "United States Income Taxation--Potential
Extension of Interest Payment Period" herein.
SPECIAL EVENT REDEMPTION OR EXCHANGE
Upon the occurrence and continuation of a Special Event (as defined in the
accompanying Prospectus, which term, as so defined, relates to a change in law
or regulation or official interpretation thereof), UI, as
S-3
<PAGE>
general partner of United Capital (the "General Partner"), will elect to cause
United Capital (i) to redeem the Series A Preferred Capital Securities in whole
(and not in part) or (ii) to distribute Series A Debentures in exchange for
Series A Preferred Capital Securities. A condition to any such exchange will be
receipt by United Capital of an opinion of counsel that such exchange will be
treated as a non-taxable exchange to the holders of the Preferred Capital
Securities. In the case of a Special Event that is a Tax Event (as defined in
the accompanying Prospectus), the General Partner may also elect to cause the
Series A Preferred Capital Securities to remain outstanding. See "Certain Terms
of the Series A Preferred Capital Securities--Redemption or Exchange" herein
and "Description of the Preferred Capital Securities--Special Event Redemption
or Exchange" in the accompanying Prospectus.
In April 1994, the Internal Revenue Service (the "IRS") issued certain
notices generally addressing the characteristics that distinguish debt from
equity for various purposes under the Federal income tax laws. In these
notices, the IRS indicated that transactions involving securities that, like
the Series A Preferred Capital Securities, have both debt and equity
characteristics would be reviewed with scrutiny to determine how they would be
treated for tax purposes. UI believes that interest on the Series A Debentures
will be deductible under the tests referred to in these notices. If, as a
result of a change in law or a pronouncement or decision interpreting or
applying any applicable law, United Capital receives an opinion of counsel to
the effect that interest on the Series A Debentures would not be deductible,
United Capital would have the option (i) to redeem the Series A Preferred
Capital Securities, (ii) to distribute the Series A Debentures in exchange
therefor or (iii) to cause the Series A Preferred Capital Securities to remain
outstanding, in each case as described under "Description of the Preferred
Capital Securities--Special Event Redemption or Exchange" in the accompanying
Prospectus.
THE UNITED ILLUMINATING COMPANY
UI is an operating electric public utility company, incorporated under the
laws of the State of Connecticut in 1899. It is engaged principally in the
production, purchase, transmission, distribution and sale of electricity for
residential, commercial and industrial purposes in a service area of about 335
square miles in the southwestern part of the State of Connecticut. The
population of this area is approximately 698,000, or 21% of the population of
the State of Connecticut. The service area, largely urban and suburban in
character, includes the principal cities of Bridgeport (population 135,250) and
New Haven (population 123,470) and their surrounding areas. Situated in the
service area are retail trade and service centers, as well as large and small
industries providing a wide variety of products, including helicopters and
other transportation equipment, electrical equipment, chemicals and
pharmaceuticals. Of UI's 1993 retail electric revenues, approximately 39% were
derived from residential sales, 43% from commercial sales, 16% from industrial
sales and 2% from other sales.
UI has four wholly-owned direct subsidiaries. Bridgeport Electric Company, a
single-purpose corporation, owns and leases to UI a generating unit at
Bridgeport Harbor Station. Research Center, Inc. has been formed to participate
in the development of one or more regulated power production ventures,
including possible participation in arrangements for the future development of
independent power production and cogeneration facilities. United Energy
International, Inc. has been formed to facilitate participation in a proposed
joint venture relating to power production plants abroad. United Resources,
Inc. ("URI") serves as the parent corporation for UI's unregulated businesses,
each of which is incorporated separately to participate in business ventures
that will complement and enhance UI's electric utility business and serve the
interests of UI and its shareholders and customers.
Four wholly-owned subsidiaries of URI have been incorporated. Souwestcon
Properties, Inc. is participating as a 25% partner in the ownership of a
medical hotel building in New Haven. A second wholly-owned subsidiary of URI is
Thermal Energies, Inc., which is participating in the development of district
heating and cooling water facilities in the downtown New Haven area, including
the energy center for an office tower and participation as a 37% partner in the
energy center for a city hall and office tower complex. A third URI subsidiary,
Precision Power, Inc., provides power-related equipment and services to the
owners
S-4
<PAGE>
of commercial buildings and industrial facilities. A fourth URI subsidiary,
American Payment Systems, Inc., manages equipment for electronic data
processing of bill payments made by customers of utilities, including UI, at
neighborhood businesses. In addition to these subsidiaries, URI has an 82%
ownership interest in Ventana Corporation, which offers energy conservation
engineering and project management services to governmental and private
institutions. The Board of Directors of UI has authorized the investment of a
maximum of $18.0 million, in the aggregate, of UI's assets in all of these URI
ventures and, at June 30, 1994, approximately $13.5 million had been so
invested.
UI has ownership and leasehold interests in three nuclear generating units
located in New England, including a 17.5% undivided ownership and leasehold
interest in Seabrook Unit 1, a 1,150-megawatt unit in Seabrook, New Hampshire
("Seabrook 1").
For further information about these and other matters affecting UI's
business, see "Incorporation of Certain Documents by Reference" in the
accompanying Prospectus.
UNITED CAPITAL FUNDING PARTNERSHIP L.P.
United Capital is a limited partnership that was formed under the Delaware
Revised Uniform Limited Partnership Act, as amended (the "Delaware Act"), on
August 18, 1994. United Capital was formed for the sole purpose of issuing
Limited Partner Interests and lending the proceeds thereof to UI. UI is the
sole General Partner and will manage the business and affairs of United
Capital. Holders of Series A Preferred Capital Securities and other Limited
Partner Interests of United Capital will be limited partners of United Capital.
UI will make capital contributions from time to time to the extent required so
that the total contributions made by UI, as the General Partner, shall at all
times be at least equal to 1% of the total contributions made by all partners.
United Capital will lend such amounts to UI from time to time in return for
Indenture Securities of UI, including the Series A Debentures. The rights and
obligations of UI, as the General Partner, and the limited partners of United
Capital will be governed by the Delaware Act and by an Amended and Restated
Agreement of Limited Partnership of United Capital (the "Partnership
Agreement") substantially in the form filed as an exhibit to the Registration
Statement of which this Prospectus Supplement is a part. United Capital has
been advised by its special Delaware counsel that, assuming a holder of
Preferred Capital Securities acts in conformity with the provisions of the
Partnership Agreement, such holder (other than the General Partner) will not be
liable for the debts, obligations and liabilities of United Capital, whether
arising in contract, tort or otherwise, solely by reason of being a limited
partner of United Capital (subject to the obligation of a limited partner to
repay any funds wrongfully distributed to it). The principal executive office
of United Capital is c/o The United Illuminating Company, 157 Church Street,
New Haven, Connecticut 06506-0901, telephone number (203) 499-2000.
S-5
<PAGE>
SUMMARY FINANCIAL INFORMATION
The following material, which is presented herein solely to furnish limited
financial information regarding UI, is qualified in its entirety by reference
to the detailed information and financial statements contained in the
Incorporated Documents (as defined in the accompanying Prospectus) and
available upon request from UI. See "Available Information" in the
accompanying Prospectus. Accordingly, the following should be read together
with the Incorporated Documents.
<TABLE>
<CAPTION>
SIX MONTHS ENDED TWELVE MONTHS ENDED DECEMBER 31,
JUNE 30, 1994 --------------------------------
(UNAUDITED) 1993 1992 1991
---------------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Operating Revenues........... $321,012 $ 653,023 $ 667,325 $ 673,371
Operating Income............. 59,258 114,814 108,022 103,200
Total Allowance for Funds
Used During Construction
(1)......................... 1,944 4,067 3,232 5,190
Deferred Return (2).......... -- 7,497 15,959 17,970
Total Interest Charges....... 42,157 92,290 101,548 100,143
Net Income................... 18,352 40,481 56,768 55,550
</TABLE>
<TABLE>
<CAPTION>
AS OF JUNE 30, 1994
-----------------------------------------------------
ACTUAL AS ADJUSTED (3)
-------------------------- --------------------------
AMOUNT PERCENT OF AMOUNT PERCENT OF
(UNAUDITED) CAPITALIZATION (UNAUDITED) CAPITALIZATION
----------- -------------- ----------- --------------
<S> <C> <C> <C> <C>
CAPITALIZATION:
Long-Term Debt (including
current maturities)..... $ 958,341 67.3% $ 889,316 62.3%
Preferred Stock.......... 45,945 3.2 18,445 1.3
Preferred Securities of
Subsidiary.............. -- -- 100,000 7.0
Common Stock Equity...... 420,520 29.5 420,520 29.4
---------- ----- ---------- -----
Total Capitalization..... $1,424,806 100.0% $1,428,281 100.0%
========== ===== ========== =====
</TABLE>
- ------------
(1) Allowance for Funds Used During Construction ("AFUDC") is a non-cash
credit to income that represents the approximate cost of debt and equity
capital devoted to plant under construction. For balance sheet purposes,
AFUDC is capitalized to UI's Plant account and depreciated and recovered
over the life of the asset.
(2) Deferred Return is a non-cash credit to income that represents the
approximate cost of debt and equity capital devoted to the portion of
Seabrook 1 that is presently excluded from rate base in accordance with
the phase-in to rate base of UI's investment in Seabrook 1 over a five-
year period beginning in 1995. For balance sheet purposes, Deferred Return
is capitalized as a deferred debit and amortized and recovered over a
five-year period.
(3) Adjusted to give effect to the issuance by United Capital of $100,000,000
aggregate stated liquidation preference of the Series A Preferred Capital
Securities, the use of the proceeds thereof by United Capital to purchase
the Series A Debentures from UI and the assumed use of the net proceeds
thereof by UI to redeem outstanding preferred stock and repay maturing
long-term debt. See "Use of Proceeds."
USE OF PROCEEDS
The proceeds from the sale of the Series A Preferred Capital Securities,
together with the related capital contribution made by the General Partner,
will be lent to UI in return for the Series A Debentures. UI intends to apply
the proceeds of such loan or loans to the payment or provision for payment at
maturity or the purchase (on the open market, in private transactions or
otherwise) or redemption of outstanding securities of UI and for general
corporate purposes.
S-6
<PAGE>
CERTAIN TERMS OF THE SERIES A PREFERRED CAPITAL SECURITIES
The following summary of certain terms of the Series A Preferred Capital
Securities supplements the description of the Preferred Capital Securities set
forth in the accompanying Prospectus under the heading "Description of the
Preferred Capital Securities," to which description reference is hereby made.
GENERAL
The Series A Preferred Capital Securities will be issued as the initial
series of Preferred Capital Securities pursuant to the Partnership Agreement.
An aggregate of Series A Preferred Capital Securities, having an aggregate
stated liquidation preference of $ , are being offered hereby.
DIVIDENDS
Dividends on the Series A Preferred Capital Securities will be cumulative
from the date of issue and will be payable monthly in arrears on the last day
of each calendar month of each year at an annual rate of % of the liquidation
preference of $25 per security. The first dividend payment date for the Series
A Preferred Capital Securities will be , 1994. See "Description of the
Preferred Capital Securities--Dividends" in the accompanying Prospectus.
UI has the right, from time to time, to extend interest payment periods on
the Series A Debentures for up to 60 consecutive months, and, as a consequence,
monthly dividends on the Series A Preferred Capital Securities will be deferred
by United Capital during any such extended interest payment period. For a
description of UI's right to so extend interest payment periods, and the effect
of any such extension on its ability to declare and pay dividends on shares of
its capital stock, see "Description of the Debentures and the Indenture--Option
to Extend Interest Payment Period" in the accompanying Prospectus.
REDEMPTION OR EXCHANGE
On or after , 1999, United Capital may, at its option and at the
direction of UI, redeem the Series A Preferred Capital Securities in whole or
in part at the Redemption Price. In addition, if at any time United Capital or
UI, as a consequence of (i) the Series A Debentures not being treated as
indebtedness for United States Federal income tax purposes or (ii) United
Capital not being treated as a partnership for United States Federal income tax
purposes, is or would be required to pay certain additional amounts or to
withhold or deduct certain amounts, the Series A Preferred Capital Securities
are redeemable, at the option of United Capital, in whole or in part at the
Redemption Price. See "Certain Terms of the Series A Preferred Capital
Securities--Optional Redemption" and "--Redemption Procedures" in the
accompanying Prospectus.
Series A Preferred Capital Securities will be subject to mandatory redemption
upon the payment of Series A Debentures at maturity or redemption, as described
under "Description of the Preferred Capital Securities--Mandatory Redemption"
in the accompanying Prospectus, and may be subject to redemption or exchange
for Series A Debentures upon the occurrence and continuation of a Special Event
(which relates to a change in law or regulation or official interpretation
thereof), as described under "Description of the Preferred Capital Securities--
Special Event Redemption or Exchange" in the accompanying Prospectus.
CERTAIN TERMS OF THE SERIES A DEBENTURES
The following summary of certain terms and provisions of the Series A
Debentures supplements the description of the Debentures set forth in the
accompanying Prospectus under the heading "Description of the Debentures and
the Indenture," to which description reference is hereby made.
GENERAL
Pursuant to the Indenture dated , 1994 between UI and The Bank of New
York, as trustee (as supplemented from time to time, the "Indenture"), and to
evidence the loan by United Capital to UI of the proceeds of the issuance of
the Series A Preferred Capital Securities and the related capital contribution
made by the General Partner, UI will issue the Series A Debentures to United
Capital in an aggregate principal amount equal to the sum of the aggregate
liquidation preference of the Series A Preferred Capital Securities and the
amount of such capital contribution.
S-7
<PAGE>
The entire principal amount of the Series A Debentures will become due and
payable, together with any accumulated and unpaid interest thereon, including
Additional Interest (as defined in the accompanying Prospectus), if any, on
, 2024 (subject to UI's rights and obligations to redeem the Series A
Debentures). See "Redemption" below.
INTEREST
The Series A Debentures will bear interest at a rate of % per annum from
the date they are issued until paid. Such interest will be payable monthly on
the last day of each calendar month of each year, commencing , 1994. See
"Description of the Debentures and the Indenture--Interest" and "--Option to
Extend Interest Payment Period" in the accompanying Prospectus.
REDEMPTION
The Series A Debentures may be redeemed at the option of UI, at any time on
or after , 1999, in whole or in part, at a redemption price equal to 100%
of the principal amount thereof plus any accrued but unpaid interest, including
Additional Interest, if any, to the date fixed for redemption. In addition, if
United Capital redeems Series A Preferred Capital Securities in accordance with
the terms thereof, UI shall redeem Series A Debentures in a principal amount
equal to the aggregate liquidation preference of the Series A Preferred Capital
Securities so redeemed, at a redemption price equal to 100% of the aggregate
principal amount of such Series A Debentures to be redeemed, plus any accrued
but unpaid interest, including Additional Interest, if any, any such redemption
to be made on the date the Series A Preferred Capital Securities are redeemed
or on such earlier date as United Capital and UI shall agree.
UNITED STATES INCOME TAXATION
GENERAL
This section is a summary of certain United States Federal income tax
considerations that may be relevant to prospective purchasers of Preferred
Capital Securities and represents the opinion of Reid & Priest, special tax
counsel to UI and United Capital, insofar as it relates to matters of law and
legal conclusions. This section is based upon current provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed
regulations thereunder and current administrative rulings and court decisions,
all of which are subject to change. Subsequent changes may cause tax
consequences to vary substantially from the consequences described below.
No attempt has been made in the following discussion to comment on all
Federal income tax matters affecting purchasers of Series A Preferred Capital
Securities. Moreover, the discussion focuses on holders of Series A Preferred
Capital Securities who are individual citizens or residents of the United
States and has only limited application to corporations, estates, trusts and
non-resident aliens. Accordingly, each prospective purchaser of Series A
Preferred Capital Securities should consult, and should depend upon, his or her
own tax advisor in analyzing the Federal, state, local and foreign income tax
consequences of the purchase, ownership or disposition of Series A Preferred
Capital Securities.
INCOME FROM SERIES A PREFERRED CAPITAL SECURITIES
In the opinion of Reid & Priest, United Capital will be treated as a
partnership for Federal income tax purposes. Accordingly, each Series A
Preferred Capital Securities holder will be required to include in gross income
his or her distributive share of United Capital's net income. Any amount so
included in a Series A Preferred Capital Securities holder's gross income will
increase his or her tax basis in the Series A Preferred Capital Securities, and
the amount of cash dividends distributed to the Series A Preferred Capital
Securities holder will be a non-taxable reduction in his or her tax basis in
the Series A Preferred Capital Securities. The income included in a Series A
Preferred Capital Securities holder's gross income should not exceed dividends
received on such Series A Preferred Capital Securities, except in the limited
circumstances described under "Potential Extension of Interest Payment Period"
below. No portion of such income will be eligible for the dividends received
deduction.
S-8
<PAGE>
DISPOSITION OF SERIES A PREFERRED CAPITAL SECURITIES
Upon the sale or redemption for cash of Series A Preferred Capital
Securities, gain or loss realized will be recognized by each Series A Preferred
Capital Securities holder in an amount equal to the difference between (i) the
amount realized by the Series A Preferred Capital Securities holder for such
Series A Preferred Capital Securities and (ii) such holder's tax basis in such
Series A Preferred Capital Securities. Depending upon the particular
circumstances of a Series A Preferred Capital Securities holder, gain or loss
recognized by such holder on the sale or exchange of Series A Preferred Capital
Securities held for more than one year will generally be taxable as long-term
capital gain or loss.
EXCHANGE OF SERIES A PREFERRED CAPITAL SECURITIES FOR SERIES A DEBENTURES
Under certain circumstances relating to changes in law, as described under
the caption "Description of the Series A Preferred Capital Securities--Special
Event Redemption or Exchange" in the accompanying Prospectus, United Capital
may distribute the Series A Debentures to Series A Preferred Capital Securities
holders in exchange for the Series A Preferred Capital Securities. As described
in "Description of the Series A Preferred Capital Securities--Special
Redemption or Exchange" in the accompanying Prospectus, in the case of a
Special Event, Series A Debentures may not be distributed to the holders of
Series A Preferred Capital Securities unless United Capital receives an opinion
of counsel to the effect that holders of Series A Preferred Capital Securities
will not recognize gain or loss for Federal income tax purposes as a result of
such distribution. Such an exchange will result in each Series A Preferred
Capital Securities holder receiving an aggregate basis in its Series A
Debentures equal to such holder's aggregate tax basis in its Series A Preferred
Capital Securities. A Series A Preferred Capital Securities holder's holding
period in the Series A Debentures received in such an exchange will include the
period for which the Series A Preferred Capital Securities were held by such
holder, provided the Series A Preferred Capital Securities were held as a
capital asset.
UNITED CAPITAL INFORMATION RETURNS AND AUDIT PROCEDURES
UI, as the General Partner of United Capital, will furnish each Series A
Preferred Capital Securities holder with a Schedule K-1 for each year setting
forth such Series A Preferred Capital Securities holder's allocable share of
income for the prior calendar year. Such allocable share of income will
generally be reflected as interest income on such Schedule K-1. UI is currently
required to furnish such Schedule K-1 to each holder as soon as practicable
following the end of each year, but in any event prior to March 31.
Any person who holds Series A Preferred Capital Securities as a nominee for
another person is required to furnish to United Capital: (i) the name, address
and taxpayer identification number of the beneficial owner and nominee; (ii)
information as to whether the beneficial owner is (A) a person that is not a
United States person, (B) a foreign government, an international organization
or any wholly-owned agency or instrumentality of the foregoing or (C) a tax-
exempt entity; (iii) the amount and description of the Series A Preferred
Capital Securities held, acquired or transferred for the beneficial owner; and
(iv) certain information including the dates of acquisitions and transfers,
means of acquisitions and transfers, and acquisition costs for purchases, as
well as the amount of net proceeds from sales. Brokers and financial
institutions are required to furnish additional information, including whether
they are United States persons, and certain information on Series A Preferred
Capital Securities that they acquire, hold or transfer for their own accounts.
A penalty of $50 per failure (up to a maximum of $100,000 per calendar year) is
imposed by the Code for failure to report such information to United Capital.
The nominee is required to supply the beneficial owners of the Series A
Preferred Capital Securities with the information furnished to United Capital.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD
Under the terms of the Indenture, UI has the right to extend from time to
time interest payment periods on the Series A Debentures for up to 60
consecutive months. Because the interest payment period is extendable, the
interest on the Series A Debentures will be treated as "original issue
discount" ("OID") pursuant to Code sections 1271 et seq. and the Treasury
Regulations promulgated thereunder. Pursuant
S-9
<PAGE>
thereto, United Capital will be required to include the interest on the Series
A Debentures in income as it accrues in accordance with a constant yield method
based upon a compounding of interest, before actual receipt of the cash payment
representing such interest.
Accrued income includible by United Capital during an extended interest
payment period pursuant to the OID rules will be allocated, but not
distributed, to Series A Preferred Capital Securities holders of record on the
Business Day (as defined in the accompanying Prospectus) preceding the last day
of each calendar month. As a result, during an extended interest payment
period, Series A Preferred Capital Securities holders of record will include
interest in gross income in advance of the receipt of cash and any such holders
who dispose of Series A Preferred Capital Securities prior to the record date
for the payment of dividends following such extended interest payment period
will include interest in gross income but will not receive any cash related
thereto from United Capital. The tax basis of Series A Preferred Capital
Securities will be increased by the amount of any interest that is included in
a Series A Preferred Capital Securities holder's income without receipt of
cash, and will be decreased when and if such cash is subsequently received by
such Series A Preferred Capital Securities holder from United Capital.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien holder" is any holder
of Series A Preferred Capital Securities that is (i) a nonresident alien
individual, (ii) a foreign corporation or partnership or (iii) an estate or
trust that has a foreign fiduciary, in each case not subject to Federal income
taxation on a net income basis in respect of such Series A Preferred Capital
Securities.
Under current Federal income tax law, subject to the discussion below with
respect to backup withholding:
(a) payments by United Capital or any of its paying agents to any United
States Alien holder will not be subject to Federal withholding tax provided
that (i) the beneficial owner of Series A Preferred Capital Securities does
not actually or constructively own 10% or more of the total combined voting
power of all classes of stock of UI entitled to vote, (ii) the beneficial
owner of Series A Preferred Capital Securities is not a controlled foreign
corporation that is related to UI through stock ownership, and (iii) either
(A) the beneficial owner of Series A Preferred Capital Securities certifies
to United Capital or its agent, under penalties of perjury, that it is a
United States Alien holder and provides its name and address or (B) the
holder of Series A Preferred Capital Securities is a securities clearing
organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "Financial
Institution") and such Financial Institution certifies to United Capital or
its agent under penalties of perjury that such certification has been
received from the beneficial owner by it or by such Financial Institution
between it and the beneficial owner and furnishes United Capital or its
agent with a copy thereof; and
(b) a United States Alien holder will generally not be subject to Federal
tax on any gain realized upon the sale or exchange of Series A Preferred
Capital Securities unless such holder is an individual present in the
United States for 183 days or more in the taxable year of the sale and
either has a "tax home" in the United States or certain other requirements
are met.
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments to
noncorporate United States holders of Series A Preferred Capital Securities of
the sale proceeds of Series A Preferred Capital Securities within the United
States, and "backup withholding" at a rate of 31% will apply to such payments
if any such Series A Preferred Capital Securities holder fails to provide to
United Capital an accurate taxpayer identification number.
S-10
<PAGE>
In general, information reporting requirements will also apply to payments of
principal of and interest on Series A Debentures distributed to noncorporate
United States holders of Series A Preferred Capital Securities and to the
proceeds received by such holders from the sale of Series A Debentures prior to
maturity within the United States, and "backup withholding" at a rate of 31%
will apply to such payments or proceeds if the United States holder fails to
provide an accurate taxpayer identification number or to report all interest
and dividends required to be shown on his or her Federal income tax returns.
Information reporting and backup withholding will not apply to payments of
principal and interest made by UI or a paying agent to a United States Alien
holder in respect of Series A Debentures distributed to such holder if the
certification described in clause (iii) of paragraph (a) under "United States
Alien Holders" above is received, provided that the payor does not have actual
knowledge that the holder is a United States Alien holder.
Payments of the proceeds from the sale by a United States Alien holder of
Series A Preferred Capital Securities or Series A Debentures distributed to
such a holder made to or through a foreign office of a broker will not be
subject to information reporting or backup withholding. However, if the broker
is a United States person, a controlled foreign corporation for United States
Federal income tax purposes or a foreign person 50% or more of whose gross
income is effectively connected with a United States trade or business for a
specified three year period, information reporting may apply to such payments.
Payments of the proceeds from the sale by a United States Alien holder of
Series A Preferred Capital Securities or Series A Debentures distributed to a
Series A Preferred Capital Securities holder to or through the United States
office of a broker is subject to information reporting and backup withholding,
unless the holder or beneficial owner certifies as to its non-United States
status or otherwise establishes an exemption from information reporting and
backup withholding.
UNDERWRITING
Under the terms and subject to the conditions of an Underwriting Agreement
dated the date hereof (the "Underwriting Agreement"), United Capital has agreed
to sell to each of the Underwriters named below (the "Underwriters"), and each
of the Underwriters, for whom Morgan Stanley & Co. Incorporated and are
acting as representatives, has severally agreed to purchase from United
Capital, the respective number of Series A Preferred Capital Securities set
forth opposite its name below:
<TABLE>
<CAPTION>
NUMBER OF
SERIES A
PREFERRED
CAPITAL
UNDERWRITERS SECURITIES
------------ ----------
<S> <C>
Morgan Stanley & Co. Incorporated....................................
Total..............................................................
====
</TABLE>
S-11
<PAGE>
The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the Series A Preferred Capital
Securities are subject to the approval of certain legal matters by their
counsel and to certain other conditions. The Underwriters are committed to take
and pay for all such Series A Preferred Capital Securities offered hereby, if
any are taken.
The Underwriters propose to offer all or part of the Series A Preferred
Capital Securities directly to the public at the public offering price set
forth on the cover page hereof, and all or part to certain dealers at a price
that represents a concession not in excess of $ per security. The
Underwriters may allow, and such dealers may reallow, a concession not in
excess of $ per security to certain other dealers. After the initial
offering date of the Series A Preferred Capital Securities, the offering price
and other selling terms may from time to time be varied by the Underwriters.
Because the proceeds of the sale of the Series A Preferred Capital Securities
will be loaned to UI, UI has agreed, in the Underwriting Agreement, to pay to
the Underwriters as compensation for their services an amount of $ per
security ($ per security sold to certain institutions) for the accounts of
the several Underwriters.
Certain of the Underwriters engage in transactions with, and from time to
time have performed services for, UI in the ordinary course of business.
Application will be made to list the Series A Preferred Capital Securities on
the New York Stock Exchange. Listing will be contingent upon meeting the
requirements of such Exchange, including those relating to distribution.
United Capital and UI have agreed to indemnify the several Underwriters
against certain liabilities, including liabilities under the Securities Act of
1933, as amended, or to contribute with respect to payments that the
Underwriters may be required to make in respect thereof.
S-12
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE +
+WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES +
+LAWS OF ANY SUCH JURISDICTION. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS (Subject to Completion, Issued , 1994)
$100,000,000
The United Illuminating Company
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
-----------
United Capital Funding Partnership L.P.
PREFERRED CAPITAL SECURITIES
(Liquidation Preference $25 per Security)
Guaranteed to the extent set forth herein by
The United Illuminating Company
-----------
The United Illuminating Company ("UI") may offer, from time to time, in one
or more series, its junior subordinated deferrable interest debentures (the
"Debentures"). The Debentures may be offered in amounts, at prices and on terms
to be determined at the time of offering. The Debentures will rank subordinate
in right of payment to all Senior Indebtedness (as defined herein) of UI.
United Capital Funding Partnership L.P., a Delaware special purpose limited
partnership ("United Capital"), the sole general partner of which is UI, may
offer, from time to time, in one or more series, its preferred capital
securities ("Preferred Capital Securities"), which represent limited partner
interests in United Capital ("Limited Partner Interests"). The Preferred
Capital Securities may be offered in amounts, at prices and on terms to be
determined at the time of offering. United Capital was formed for the sole
purpose of issuing Limited Partner Interests and lending the proceeds thereof
to UI. United Capital will lend the proceeds of the sale of Preferred Capital
Securities to UI, together with the related capital contributions made by UI,
in return for Debentures of UI issued in connection with the investment of such
proceeds in aggregate principal amount equal to the aggregate liquidation
preference of, bearing interest at an annual rate equal to the annual dividend
rate on, and having certain redemption terms that correspond to redemption
terms for, such Preferred Capital Securities (any such Debentures, herein
referred to as Debentures of a "corresponding" series).
The payment of cash distributions ("dividends") and payments on liquidation
or redemption with respect to the Preferred Capital Securities, to the extent
of funds held by United Capital and legally available therefor, will be
guaranteed under a Payment and Guarantee Agreement (the "Guarantee") of UI to
the extent described herein. The Guarantee will also rank subordinate in right
of payment to all Senior Indebtedness of UI. Such funds will be limited to
payments by UI on the Debentures corresponding to any Preferred Capital
Securities and other Indenture Securities (as defined herein) issued under the
Indenture (as defined herein) in connection with the investment of the proceeds
from any offering of Limited Partner Interests. If UI fails to make interest
payments on such Debentures, United Capital will have insufficient funds to pay
dividends on such Preferred Capital Securities and the Guarantee will not cover
payment of such dividends. In such event, the holders of such Preferred Capital
Securities may enforce certain rights in respect of such Debentures under the
Indenture.
Interest on the Debentures may be deferred at the option of UI as described
under "Description of the Debentures and the Indenture--Option to Extend
Interest Payment Period" (whether or not such Debentures correspond to
Preferred Capital Securities) and, as a consequence, monthly dividends on the
Preferred Capital Securities may be deferred by United Capital. See
"Description of the Guarantee" and "Description of the Debentures and the
Indenture" herein for a description of the terms and limitations of the
obligations of UI relating to Preferred Capital Securities. Under certain
circumstances described herein, UI may cause United Capital to distribute the
Debentures that correspond to Preferred Capital Securities in exchange for such
Preferred Capital Securities. See "Description of the Preferred Capital
Securities--Special Event Redemption or Exchange."
Certain specific terms of the Debentures of any series and the Preferred
Capital Securities of any series in respect of which this Prospectus is being
delivered (the "Offered Securities") will be set forth in an accompanying
Prospectus Supplement (the "Prospectus Supplement") with respect to such
series, which will describe, in the case of the Debentures, the aggregate
principal amount, maturity and interest rate, and, in the case of the Preferred
Capital Securities, the number of securities and dividend rate, and, in each
case, the series designation and any other terms.
The Offered Securities may be offered in amounts, at prices and on terms to
be determined at the time of offering; provided, however, that the aggregate
initial public offering price of all Offered Securities shall not exceed
$100,000,000.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
-----------
The Offered Securities will be sold directly, through agents, underwriters
and dealers, including Morgan Stanley & Co. Incorporated, as designated from
time to time, or through a combination of such methods. The names of such
agents, dealers or underwriters and any applicable commissions or discounts
will be set forth in or may be calculated from the Prospectus Supplement. See
"Plan of Distribution."
The Prospectus Supplement relating to any series of Offered Securities will
contain information concerning certain United States Federal income tax
considerations, if applicable, to such series.
This Prospectus may not be used to consummate sales of the Offered Securities
unless accompanied by the Prospectus Supplement.
-----------
MORGAN STANLEY & CO.
Incorporated
, 1994
<PAGE>
AVAILABLE INFORMATION
UI is subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Such reports and other information filed by UI can be inspected
and copied at the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and
at the following Regional Offices of the Commission: 7 World Trade Center, 13th
Floor, New York, New York 10048; and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of such material can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Such reports and other information
concerning UI may also be inspected at the offices of the New York Stock
Exchange at 20 Broad Street, New York, New York 10005.
This Prospectus does not contain all the information set forth in the
Registration Statement on Form S-3 that UI and United Capital have filed with
the Commission under the Securities Act of 1933, as amended (the "Securities
Act"), of which this Prospectus forms a part. Statements contained or
incorporated by reference herein concerning the provisions of documents are
necessarily summaries of such documents, and each statement is qualified in its
entirety by reference to such Registration Statement, including the documents
filed as exhibits thereto (the "Registration Statement").
No separate financial statements of United Capital have been included or
incorporated by reference herein. UI and United Capital do not consider that
such financial statements would be material to holders of Preferred Capital
Securities because United Capital is a newly organized special purpose entity,
has no operating history and no independent operations and is not engaged in,
and does not propose to engage in, any activity other than as described herein.
United Capital is a special purpose limited partnership organized under the
laws of the State of Delaware, and UI is the sole general partner. United
Capital exists for the sole purpose of issuing Limited Partner Interests and
lending the proceeds thereof to UI. See "United Capital Funding Partnership
L.P."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
UI's Annual Report on Form 10-K for the fiscal year ended December 31, 1993
(the "1993 Form 10-K") and its Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1994 and June 30, 1994 have been filed with the Commission
pursuant to the Exchange Act and are hereby incorporated herein by reference.
All documents subsequently filed by UI pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act prior to the termination of the offering of the
securities offered hereby shall be deemed to be incorporated by reference into
this Prospectus and to be a part hereof from the date of filing such documents.
The documents incorporated or deemed to be incorporated herein by reference are
sometimes referred to herein as the "Incorporated Documents." Any statement
contained herein or in an Incorporated Document shall be deemed to be modified
or superseded for all purposes to the extent that a statement contained herein,
in any Prospectus Supplement or in any subsequently filed Incorporated Document
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 this Prospectus.
ANY PERSON RECEIVING A COPY OF THIS PROSPECTUS MAY OBTAIN WITHOUT CHARGE,
UPON REQUEST, A COPY OF ANY OF THE INCORPORATED DOCUMENTS (NOT INCLUDING THE
EXHIBITS TO SUCH DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED
BY REFERENCE IN SUCH INCORPORATED DOCUMENTS). REQUESTS FOR SUCH COPIES SHOULD
BE DIRECTED TO MR. CHARLES J. PEPE, ASSISTANT TREASURER AND ASSISTANT
SECRETARY, THE UNITED ILLUMINATING COMPANY, P.O. BOX 1564, 157 CHURCH STREET,
NEW HAVEN, CONNECTICUT 06506-0901, TELEPHONE NUMBER (203) 499-2311.
2
<PAGE>
THE UNITED ILLUMINATING COMPANY
UI was formed under the laws of the State of Connecticut in 1899. UI is
engaged in the production, transmission, distribution and sale of electric
energy for residential, commercial and industrial purposes in a service area of
about 335 square miles in the southwestern part of Connecticut, including the
principal cities of Bridgeport and New Haven.
For further information about UI's business, see the 1993 Form 10-K and the
other Incorporated Documents. The principal executive offices of UI are located
at 157 Church Street, New Haven, Connecticut 06506-0901, telephone number (203)
499-2000.
UNITED CAPITAL FUNDING PARTNERSHIP L.P.
United Capital is a limited partnership that was formed under the Delaware
Revised Uniform Limited Partnership Act, as amended (the "Delaware Act"), on
August 18, 1994. United Capital was formed for the sole purpose of issuing
Limited Partner Interests and lending the proceeds thereof to UI. UI is the
sole General Partner of United Capital and will manage the business and affairs
of United Capital. Holders of Preferred Capital Securities will be limited
partners in United Capital. UI will make capital contributions from time to
time to the extent required so that the total contributions made by the General
Partner shall at all times be at least equal to 1% of the total contributions
made by all partners. United Capital will lend such amounts to UI from time to
time in return for Indenture Securities of UI, including the Debentures. The
rights and obligations of the General Partner and the limited partners of
United Capital will be governed by the Delaware Act and by an Amended and
Restated Agreement of Limited Partnership of United Capital (the "Partnership
Agreement") substantially in the form filed as an exhibit to the Registration
Statement. The principal executive office of United Capital is c/o The United
Illuminating Company, 157 Church Street, New Haven, Connecticut 06506-0901,
telephone number (203) 499-2000.
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement, UI intends to apply
the net proceeds from the issuance of the Debentures to the payment or
provision for payment at maturity the purchase (on the open market, in private
transactions or otherwise) or redemption of outstanding securities of UI and
for general corporate purposes. United Capital will invest all proceeds from
the sale of the Preferred Capital Securities in corresponding Debentures.
3
<PAGE>
UI EARNINGS RATIOS
UI's Ratio of Earnings to Fixed Charges for each of the periods indicated
was as follows:
<TABLE>
<CAPTION>
TWELVE MONTHS TWELVE MONTHS ENDED DECEMBER 31,
ENDED ----------------------------------
JUNE 30, 1994 1993 1992 1991 1990 1989
------------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed
Charges (A)................ 1.69 1.69 1.85 1.83 1.69 -- (B)
</TABLE>
UI's Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividend Requirements for each of the periods indicated was as follows:
<TABLE>
<CAPTION>
TWELVE
TWELVE MONTHS MONTHS ENDED DECEMBER 31,
ENDED -----------------------------
JUNE 30, 1994 1993 1992 1991 1990 1989
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<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined
Fixed Charges and Preferred
Stock Dividend Requirements
(A)(C)......................... 1.57 1.57 1.74 1.71 1.59 -- (B)
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(A) "Earnings," as defined by Commission Regulation S-K, represent the
aggregate of (1) net income, (2) taxes based on income, (3) investment tax
credit adjustments--net and (4) fixed charges. "Fixed Charges," as defined
by Commission Regulation S-K, represent interest (whether expended or
capitalized), related amortization and interest applicable to rentals
charged to operating expenses.
(B) For the twelve months ended December 31, 1989, Earnings were less than
Fixed Charges and Combined Fixed Charges and Preferred Stock Dividend
Requirements due to the impact on Earnings of write-offs of costs of
nuclear generating units pursuant to Statement of Financial Accounting
Standards No. 90. The additional Earnings required to increase the Ratio
of Earnings to Fixed Charges to 1.0 would have been $156.126 million; and
the additional Earnings required to increase the Ratio of Earnings to
Combined Fixed Charges and Preferred Stock Dividend Requirements to 1.0
would have been $171.457 million.
(C) "Preferred Stock Dividend Requirements," as defined by Commission
Regulation S-K, represent preferred stock dividends increased to reflect
the pre-tax earnings required to cover such dividend requirements.
DESCRIPTION OF THE PREFERRED CAPITAL SECURITIES
Set forth below is a summary of certain terms and provisions of the
Preferred Capital Securities. This summary does not purport to be complete and
is subject to, and qualified in its entirety by reference to, the forms of
Partnership Agreement and Action of General Partner establishing the Preferred
Capital Securities of each series filed as exhibits to the Registration
Statement.
GENERAL
The Partnership Agreement will authorize UI, as the General Partner, to
establish various series of Limited Partner Interests, including one or more
series of Preferred Capital Securities, having such designations, rights,
privileges, restrictions and other terms and provisions as the General Partner
may determine. The Preferred Capital Securities are Limited Partner Interests
in United Capital, and may be issued from time to time, having terms described
herein and in the Prospectus Supplement relating thereto. The Limited Partner
Interests, including the Preferred Capital Securities, will have a preference
with respect to cash distributions and amounts payable on liquidation over the
General Partner's interest in United Capital. The Action or Actions of General
Partner creating the Preferred Capital Securities will not permit the issuance
of any Limited Partner Interests of United Capital ranking, as to the payment
of dividends or participation in profits or the assets of United Capital,
senior to the Preferred Capital Securities.
Amounts payable in respect of the Preferred Capital Securities will be
guaranteed by UI to the extent set forth under "Description of the Guarantee"
below.
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Under certain circumstances described herein, the Preferred Capital
Securities may be exchanged for corresponding Debentures of UI. See "Special
Event Redemption or Exchange" below. Each holder of Preferred Capital
Securities, by its acceptance thereof, agrees that such Debentures and the
Guarantee are subordinate and junior in right of payment to all Senior
Indebtedness. See "Description of the Guarantee--Status of Guarantee" and
"Description of the Debentures and the Indenture--Subordination."
DIVIDENDS
Unless otherwise specified in a Prospectus Supplement, dividends on the
Preferred Capital Securities of each series will be cumulative, will accumulate
from the date of issue and will be payable monthly in arrears on the last day
of each calendar month of each year except as otherwise described below.
The annual dividend rate on the Preferred Capital Securities of each series
will be set forth in the Prospectus Supplement relating to the Preferred
Capital Securities of such series. Accrued and unpaid dividends on the
Preferred Capital Securities of each series will accrue additional dividends in
respect thereof after the dividend payment date therefor at the dividend rate
per annum applicable to the Preferred Capital Securities of such series. The
term "dividends" as used herein includes any such additional dividends payable
unless otherwise stated.
The amount of dividends payable for any period will be computed on the basis
of twelve 30-day months and a 360-day year and, for any period shorter than a
full monthly dividend period, will be computed on the basis of the actual
number of days elapsed in such period.
Payment of dividends on the Preferred Capital Securities is limited in
relation to the amount of funds held by United Capital and legally available
therefor. Dividends on the Preferred Capital Securities are required to be paid
to the extent that, on any scheduled dividend payment date, United Capital has
(x) funds legally available for the payment of such dividends, as determined by
the General Partner, and (y) cash on hand sufficient to permit such payment.
Such funds and cash on hand will be limited to UI's payments of interest on the
corresponding Debentures and other Indenture Securities issued in connection
with the investment of the proceeds of any offering of Limited Partner
Interests. See "Description of the Debentures and the Indenture."
UI has the right under the Indenture, from time to time, to extend the
interest payment periods on the Debentures for up to 60 consecutive months,
and, as a consequence, monthly dividends on the Preferred Capital Securities
will be deferred by United Capital (and will continue to accumulate with
additional dividends on any amounts so deferred) during any such extended
interest payment period. In the event that UI exercises its right to so extend
any such interest payment period, UI shall not, and shall not permit any of its
subsidiaries to, declare or pay dividends on, or redeem, purchase, acquire or
make a liquidation payment with respect to, any capital stock of UI or its
subsidiaries. UI currently has no intention to so extend any such interest
payment period, and it believes that such an extension of an interest payment
period is unlikely. See "Voting Rights" below and "Description of the
Debentures and the Indenture--Option to Extend Interest Payment Period."
Dividends on the Preferred Capital Securities will be payable to the holders
thereof as they appear on the books and records of United Capital on the
relevant record dates, which will be one Business Day (as defined herein) prior
to each relevant payment date; provided, however, that if the Preferred Capital
Securities of any series are not held by a securities depositary, the General
Partner shall have the right to change such record dates. Subject to any
applicable laws and regulations and the provisions of the Partnership
Agreement, each such payment will be made as described under "Book-Entry-Only
Issuance" below. In the event that any date on which dividends are payable on
the Preferred Capital Securities is not a Business Day, then payment of the
dividends payable on such date will be made on the next succeeding day that is
a Business Day (and without any additional dividends or other payment in
respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect, and in the
same amount, as if made on such date. A "Business Day" shall mean any day other
than a day on which banking institutions in the City of New York or the City of
New Haven, Connecticut are authorized or required by law to close.
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CERTAIN RESTRICTIONS ON UNITED CAPITAL
If dividends or any Additional Amounts (as defined herein) have not been paid
in full on the Preferred Capital Securities of any series, United Capital shall
not:
(i) pay, or set aside for payment, any dividends on any other Limited
Partner Interests ranking pari passu with the Preferred Capital Securities
of such series as regards participation in profits of United Capital
("Dividend Parity Securities"), unless, at the time of such payment or
setting aside, there shall also be paid, or set aside for payment, as the
case may be, dividends on the Preferred Capital Securities of such series
on a pro rata basis, so that, after giving effect to the payment of all
such dividends, (x) the ratio of (a) the aggregate amount of dividends paid
on the Preferred Capital Securities of such series to (b) the aggregate
amount of dividends paid on such Dividend Parity Securities is the same as
(y) the ratio of (a) the aggregate of all accumulated arrears of unpaid
dividends and any Additional Amounts in respect of the Preferred Capital
Securities of such series to (b) the aggregate of all accumulated arrears
of unpaid dividends and any Additional Amounts in respect of such Dividend
Parity Securities;
(ii) pay, or set aside for payment, any dividends or other distributions
on any other securities of United Capital ranking junior to the Preferred
Capital Securities of such series as to dividends ("Dividend Junior
Securities"); or
(iii) redeem, purchase or otherwise acquire any Preferred Capital
Securities of such series, any Dividend Parity Securities or any Dividend
Junior Securities;
until, in each case, such time as all accumulated and unpaid dividends accrued
on the Preferred Capital Securities of such series and any Additional Amounts
in respect thereof shall have been paid in full for all dividend periods
terminating on or prior to, in the case of clauses (i) and (ii) above, such
payment and, in the case of clause (iii) above, the date of such redemption,
purchase or acquisition.
OPTIONAL REDEMPTION
Unless otherwise provided in a Prospectus Supplement relating to the
Preferred Capital Securities of any series, the Preferred Capital Securities of
such series will be redeemable, at the option of United Capital and at the
direction of UI, in whole or in part from time to time, on or after the date
set forth in such Prospectus Supplement, upon not less than 30 nor more than 60
days' notice, at a redemption price of $25 per security, plus an amount equal
to accumulated and unpaid dividends thereon and any Additional Amounts in
respect thereof to the date fixed for redemption (the "Redemption Price");
provided, however, that prior to giving any such notice of redemption United
Capital shall have received from UI a notice of redemption of Debentures of the
corresponding series having an aggregate principal amount equal to the
aggregate liquidation preference of the Preferred Capital Securities to be
redeemed.
If at any time after the issuance of any series of Preferred Capital
Securities, United Capital is or would be required to pay Additional Amounts in
respect thereof, as described under "Additional Amounts" below, or UI is or
would be required to withhold or deduct certain amounts, as described under
"Description of the Guarantee--Additional Amounts," then United Capital may, at
its option, redeem all of the Preferred Capital Securities of such series or,
if such requirement relates only to certain of the Preferred Capital Securities
of such series, the portion thereof that is subject to such requirement, upon
not less than 30 nor more than 60 days' notice, in each case at the Redemption
Price.
In the event that fewer than all the outstanding Preferred Capital Securities
of any series are to be so redeemed, the Preferred Capital Securities to be
redeemed will be selected as described under "Book-Entry-Only Issuance" below;
provided, however, that in the case of a partial redemption of any series of
Preferred Capital Securities resulting from a requirement that United Capital
pay Additional Amounts or UI withhold or deduct certain amounts, as described
in the immediately preceding paragraph, United Capital will (i) cause the
global certificate representing the Preferred Capital Securities of such series
to be withdrawn from the Depositary (as defined herein), (ii) issue
certificates in definitive form representing the Preferred Capital Securities
of such series and (iii) redeem the Preferred Capital Securities of such series
subject to such requirement. If a partial redemption would result in a
delisting of the Preferred Capital Securities of any
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series by any national securities exchange or other organization on which the
Preferred Capital Securities of such series are then listed, United Capital may
only redeem the Preferred Capital Securities of such series in whole.
MANDATORY REDEMPTION
If at any time UI (i) pays at maturity or (ii) redeems Debentures
corresponding to any Preferred Capital Securities, as described under
"Description of the Debentures and the Indenture--Optional Redemption," the
proceeds from such payment or redemption of principal of such Debentures will
be applied to redeem such Preferred Capital Securities at the Redemption Price
upon not less than 30 nor more than 60 days' notice (except that no such notice
will be required in the case of clause (i) above).
SPECIAL EVENT REDEMPTION OR EXCHANGE
If a Special Event (as defined below) shall occur and be continuing with
respect to any series of Preferred Capital Securities, the General Partner will
cause United Capital (i) to redeem the Preferred Capital Securities of such
series in whole (and not in part), upon not less than 30 nor more than 60 days'
notice, at the Redemption Price within 90 days following the occurrence of such
Special Event, or (ii) to distribute corresponding Debentures to holders of
Preferred Capital Securities of such series in exchange for the Preferred
Capital Securities of such series within 90 days following the occurrence of
such Special Event; provided, however, that in the case of clause (ii) above
United Capital shall have received an opinion of nationally recognized
independent tax counsel experienced in such matters to the effect that such
holders will not recognize any gain or loss for Federal income tax purposes as
a result of such distribution. Notwithstanding the foregoing, if the Special
Event is solely a Tax Event (as defined below), neither the General Partner nor
United Capital shall be required to elect either of the options described in
clause (i) or (ii) above and the General Partner and United Capital may,
instead, allow the Preferred Capital Securities of such series to remain
outstanding.
In the event of a distribution of Debentures as described in clause (ii)
above, each holder of Preferred Capital Securities would receive corresponding
Debentures in an aggregate principal amount equal to the aggregate liquidation
preference of $25 per security on the Preferred Capital Securities held by such
holder, bearing interest at a rate per annum equal to the dividend rate per
annum on such Preferred Capital Securities and having accrued and unpaid
interest thereon at such rate from the last date on which dividends on such
Preferred Capital Securities were paid. Under such circumstances, if there are
no other Limited Partner Interests then outstanding, UI may cause United
Capital to be dissolved.
After the date fixed for any such exchange, (i) such Preferred Capital
Securities will no longer be deemed to be outstanding, (ii) the Depositary (as
hereinafter defined) or its nominee, as the record holder thereof, will
exchange the global certificate or certificates representing such Preferred
Capital Securities for a registered global certificate or certificates
representing the corresponding Debentures to be delivered upon such exchange
and (iii) any certificates representing Preferred Capital Securities not held
by the Depositary or its nominee will be deemed to represent corresponding
Debentures having a principal amount equal to the liquidation preference of
such Preferred Capital Securities until such certificates are presented to UI
or its agent for exchange.
"Special Event" means an Investment Company Event or a Tax Event.
"Investment Company Event" means, with respect to Preferred Capital
Securities of any series, the occurrence of a change in law or regulation or a
written change in official interpretation of law or regulation by any
legislative body, court, governmental agency or regulatory authority (a "1940
Act Change in Law") to the effect that United Capital is or will be considered
an "investment company" required to be registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), which 1940 Act Change in Law becomes
effective on or after the date of the first issuance of Preferred Capital
Securities of such series; provided that no Investment Company Event shall be
deemed to have occurred if UI or United Capital shall have obtained a written
opinion of nationally recognized independent counsel experienced in practice
under the 1940 Act to the effect that UI or United Capital has successfully
taken either of the steps set forth in clause (i) or (ii) below to avoid such
1940 Act Change in Law so that in the opinion of such counsel, notwithstanding
such 1940 Act Change in Law, United Capital is not required to be registered as
an
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"investment company" within the meaning of the 1940 Act. Such steps shall be
either (i) issuing an additional or supplemental irrevocable and unconditional
guarantee (x) of accumulated and unpaid dividends accrued on and any Additional
Amounts in respect of the Preferred Capital Securities of such series (whether
or not moneys are legally available therefor) and (y) upon a liquidation of
United Capital, of the full amount of the Liquidation Distribution (as defined
herein) on the Preferred Capital Securities of such series (regardless of the
amount of assets of United Capital otherwise available for distribution in such
liquidation) or (ii) the use of any other measures that do not adversely affect
holders of Preferred Capital Securities.
"Tax Event" means, with respect to Preferred Capital Securities of any
series, that UI or United Capital shall have obtained an opinion of nationally
recognized independent tax counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority thereof or therein
affecting taxation, or any amendment to or change in an official interpretation
or application of such laws or regulations, which amendment or change is
effective on or after the date of the first issuance of Preferred Capital
Securities of such series, and which change cannot be avoided by the use of any
reasonable measures available to UI or United Capital, there is a substantial
increase in risk that (i) United Capital is subject to Federal income tax with
respect to interest received on the Debentures, (ii) interest payable on the
Debentures is not deductible for Federal income tax purposes or (iii) United
Capital is subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
REDEMPTION PROCEDURES
If (a) United Capital gives a notice of redemption in respect of Preferred
Capital Securities of any series (which notice will be irrevocable) or (b)
Preferred Capital Securities of any series shall become redeemable by virtue of
the maturity or redemption of the corresponding Debentures, then, on the date
fixed for redemption, which in the case of clause (b) above shall be the
applicable Debenture maturity date (the "Redemption Date"), United Capital will
pay the applicable Redemption Price to the record holders of Preferred Capital
Securities of such series. See "Book-Entry-Only Issuance" below. If notice of
redemption has been given and payment or provision for payment has been made on
the date fixed for redemption as required, then upon such date all rights of
holders of Preferred Capital Securities of such series so called for redemption
will cease, except the right of such holders to receive the Redemption Price.
In the event that any Redemption Date is not a Business Day, payment of the
Redemption Price payable on such date will be made on the next succeeding day
which is a Business Day (and without any additional dividends or other payment
in respect of any such delay), except that, if such Business Day falls in the
next calendar year, such payment will be made on the immediately preceding
Business Day. In the event that payment of the Redemption Price in respect of
any Preferred Capital Securities is not paid either by United Capital or by UI
pursuant to the Guarantee described under "Description of the Guarantee,"
dividends on such Preferred Capital Securities will continue to accumulate at
the then applicable rate (but without any additional dividends on amounts so
accumulating) from the original Redemption Date to the date of payment, in
which case the actual payment date will be considered the Redemption Date for
purposes of calculating the Redemption Price.
Subject to the foregoing and applicable law (including, without limitation,
Federal securities laws), UI or its affiliates may at any time and from time to
time purchase outstanding Preferred Capital Securities by tender, on the open
market or by private agreement. In the event that UI surrenders any Preferred
Capital Securities to United Capital, United Capital will distribute, to or
upon the order of UI, Debentures of the corresponding series in aggregate
principal amount equal to the aggregate liquidation preference on the Preferred
Capital Securities so surrendered.
LIQUIDATION DISTRIBUTION
In the event of any voluntary or involuntary dissolution, liquidation or
winding up of United Capital, the holders of the Preferred Capital Securities
of each series at the time outstanding will be entitled to receive out of the
assets of United Capital available for distribution to partners of United
Capital, after satisfaction of liabilities to creditors, if any, as required by
the Delaware Act, before any distribution of assets is made to
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the General Partner or any other series of Limited Partner Interests ranking
junior to the Preferred Capital Securities of such series with respect to
participation in the assets of United Capital, but together with the holders of
every other series of Limited Partner Interests outstanding, if any, ranking
pari passu with the Preferred Capital Securities of such series with respect to
participation in the assets of United Capital ("Liquidation Parity
Securities"), an amount equal to the aggregate of the liquidation preference of
$25 per security plus an amount equal to all accumulated and unpaid dividends
on the Preferred Capital Securities of such series and any Additional Amounts
in respect thereof to the date of payment (the "Liquidation Distribution").
If, upon any such liquidation, the Liquidation Distribution for Preferred
Capital Securities of any series can be paid only in part because United
Capital has insufficient assets available to pay in full the aggregate
Liquidation Distribution for Preferred Capital Securities of such series and
the aggregate maximum liquidation distributions on the Liquidation Parity
Securities, then the amounts payable directly by United Capital on the
Preferred Capital Securities of such series and on such Liquidation Parity
Securities shall be paid on a pro rata basis, so that (i) the ratio of (x) the
aggregate amount paid in respect of the Liquidation Distribution to (y) the
aggregate amount paid in respect of liquidation distributions on the
Liquidation Parity Securities is the same as (ii) the ratio of (x) the
aggregate Liquidation Distribution to (y) the aggregate maximum liquidation
distributions on the Liquidation Parity Securities.
Pursuant to the Partnership Agreement, United Capital shall be dissolved and
its affairs shall be wound up upon any of the following events: (i) on ,
2046, the expiration of the term of United Capital, (ii) the withdrawal,
removal or bankruptcy of the General Partner, or the assignment by the General
Partner of its general partner interest in United Capital, or the occurrence of
any other event that results in the General Partner ceasing to be a general
partner of United Capital under the Delaware Act, except for a transfer to a
permitted successor of UI under the Indenture, unless in any such case the
business of United Capital is continued in accordance with the Delaware Act,
(iii) the entry of decree of a judicial dissolution or (iv) the written consent
of all partners of United Capital, including the holders of the Preferred
Capital Securities and other Limited Partner Interests.
SOURCE OF PAYMENT FOR PREFERRED CAPITAL SECURITIES
United Capital is a special purpose limited partnership formed on August 18,
1994 for the sole purpose of issuing Limited Partner Interests and lending the
proceeds thereof to UI in return for Indenture Securities of UI. The proceeds
of the Preferred Capital Securities will be loaned to UI in return for
Debentures. United Capital's revenues will be limited to payments by UI on such
Debentures and other Indenture Securities issued in connection with the
investment of the proceeds of offerings of Limited Partner Interests.
Dividends on the Preferred Capital Securities must be paid to the extent of
funds held by United Capital and legally available to make such payments. Under
the terms of the Guarantee, as described under "Description of the Guarantee--
General," such payments required to be made on the Preferred Capital Securities
will be irrevocably and unconditionally guaranteed by UI. Because the payment
terms of the Debentures corresponding to any Preferred Capital Securities will
generally correspond to the payment terms of such Preferred Capital Securities,
United Capital is expected to have sufficient funds to make payments on such
Preferred Capital Securities so long as UI is not in default in payment of such
Debentures. In addition, because UI will covenant in the Guarantee to perform
timely all of its duties as General Partner, including the duty to pay
dividends on the Preferred Capital Securities and the duty to pay all costs and
expenses of United Capital, it is expected that all payments on corresponding
Debentures will be available for the payment of dividends on such Preferred
Capital Securities. UI and United Capital believe that the obligations of UI
under the Guarantee, the Partnership Agreement and the Debentures corresponding
to any Preferred Capital Securities, taken together, are substantially
equivalent to a full and unconditional guarantee by UI of payments due on the
Preferred Capital Securities. The Guarantee will be one of payment and not of
collection, and holders of Preferred Capital Securities may enforce the
Guarantee directly against UI, without first proceeding against United Capital.
If UI fails to make interest payments on the Indenture Securities corresponding
to any Limited Partner Interests, United Capital will have insufficient funds
to pay dividends on the Limited Partner Interests, including the Preferred
Capital Securities, and the Guarantee will not cover
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payment of such insufficiency. In such event, the holders of Preferred Capital
Securities may enforce certain rights in respect of the corresponding
Debentures as third party beneficiaries under the Indenture. In addition, under
certain circumstances, holders of Preferred Capital Securities will have the
right to appoint a Special Representative (as defined herein) to enforce United
Capital's rights as holder of such Debentures.
See "Description of the Guarantee" and "Description of the Debentures and the
Indenture" herein for a description of the terms and limitations of the
obligations of UI relating to the Preferred Capital Securities.
MERGER, CONSOLIDATION, AMALGAMATION, ETC. OF UNITED CAPITAL
The General Partner is authorized and directed to conduct its affairs and to
operate United Capital in such a way that United Capital would not be deemed to
be an "investment company" required to be registered under the 1940 Act or
taxed as a corporation for Federal income tax purposes and so that the
Debentures will be treated as indebtedness of UI for Federal income tax
purposes. In this connection, the General Partner is authorized to take any
action that is not inconsistent with applicable law, the Certificate of Limited
Partnership of United Capital or the Partnership Agreement and that does not
adversely affect the interests of holders of Preferred Capital Securities that
the General Partner determines in its discretion to be necessary or desirable
for such purposes.
United Capital may not consolidate, amalgamate, merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any partnership, corporation or other body,
except as described below. UI, as General Partner, may, without the consent of
the holders of the Preferred Capital Securities, cause United Capital to
consolidate, amalgamate, merge with or into, or be replaced by, or convey or
transfer its properties and assets substantially as an entirety to, a Delaware
limited partnership or "other business entity" (as defined in the Delaware Act
but not including any general partnership) organized under the laws of any
state of the United States or the Turks and Caicos Islands or the Cayman
Islands, provided that (i) such successor entity either (x) expressly assumes
all of the obligations of United Capital under the Preferred Capital Securities
or (y) substitutes for the Preferred Capital Securities other securities having
substantially the same terms as the Preferred Capital Securities (the
"Successor Securities") so long as the Successor Securities rank, with respect
to participation in the profits and assets of the successor entity, at least as
high as the Preferred Capital Securities rank, with respect to participation in
the profits and assets of United Capital, (ii) UI expressly acknowledges such
successor entity as the holder of the Debentures corresponding to the Preferred
Capital Securities and confirms its obligation under the Guarantee with respect
to the Preferred Capital Securities or the Successor Securities, (iii) such
merger, consolidation, amalgamation, replacement, conveyance or transfer does
not cause the Preferred Capital Securities to be delisted by any national
securities exchange or other organization on which the Preferred Capital
Securities are then listed unless the Preferred Capital Securities are promptly
relisted, or the Successor Securities are promptly listed, by such exchange or
other organization, (iv) such merger, consolidation, amalgamation, replacement,
conveyance or transfer does not cause the Preferred Capital Securities to be
downgraded or the Successor Securities to be rated lower than the Preferred
Capital Securities immediately prior to such merger, consolidation,
amalgamation, replacement, conveyance or transfer by any "nationally recognized
statistical rating organization" (as defined by the Commission), (v) such
merger, consolidation, amalgamation, replacement, conveyance or transfer does
not adversely affect the powers, preferences and other special rights of
holders of Preferred Capital Securities, (vi) such successor entity has a
purpose substantially identical to that of United Capital and (vii) prior to
such merger, consolidation, amalgamation, replacement, conveyance or transfer
UI has received an opinion of nationally recognized independent tax counsel to
United Capital experienced in such matters to the effect that (w) holders of
Preferred Capital Securities will not recognize any gain or loss for Federal
income tax purposes as a result of the merger, consolidation, amalgamation,
replacement, conveyance or transfer, (x) such successor entity will be treated
as a partnership for Federal income tax purposes, (y) following such merger,
consolidation, amalgamation, replacement, conveyance or transfer, UI and such
successor entity will be in compliance with the 1940 Act without registering
thereunder as an "investment company" and (z) such merger, consolidation,
amalgamation, replacement, conveyance or transfer will not adversely affect the
limited liability of holders of Preferred Capital Securities.
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VOTING RIGHTS
Except as provided below and under "Description of the Guarantee--Amendments
and Assignments" and as otherwise required by law and the Partnership
Agreement, the holders of the Preferred Capital Securities will have no voting
rights.
If (i) United Capital fails to pay in full dividends on and any Additional
Amounts in respect of the Preferred Capital Securities of any series for any
period of 18 consecutive months, (ii) any event that would (with notice or the
passage of time or both) constitute an Event of Default with respect to the
corresponding series of Debentures (as described under "Description of the
Debentures and the Indenture--Events of Default; Remedies") occurs and is
continuing or (iii) UI is in default on any of its payment or other
obligations under the Guarantee (as described under "Description of the
Guarantee--Certain Covenants of UI"), then the holders of the outstanding
Preferred Capital Securities of such series, together with the holders of any
other series of Limited Partner Interests having such right in such event,
acting as a single class, will be entitled, by vote of holders of a majority
in aggregate liquidation preference of all such Limited Partner Interests
having the right to vote, to appoint and authorize a representative (a
"Special Representative") to enforce United Capital's rights under the
corresponding Indenture Securities, including the corresponding Debentures,
and the Indenture against UI, to enforce the obligations undertaken by UI
under the Guarantee and to pay dividends on such Limited Partner Interests,
including the Preferred Capital Securities of such series (to the extent
United Capital has funds legally available for the payment of such dividends
and cash on hand sufficient to permit such payment). Any such Special
Representative shall not be admitted as a partner in United Capital or
otherwise be deemed to be a partner in United Capital and shall have no
liability for the debts, obligations or liabilities of United Capital, except
to the extent otherwise required in order for such Special Representative to
enforce the Partnership's rights under the Indenture Securities and the
Indenture and fulfill its other duties under the Partnership Agreement.
For purposes of determining whether United Capital has failed to pay
dividends in full for 18 consecutive months, dividends shall be deemed to
remain in arrears, notwithstanding any payments in respect thereof, until full
cumulative dividends and any Additional Amounts have been or contemporaneously
are set aside and paid with respect to all monthly dividend periods
terminating on or prior to the date of payment of such full cumulative
dividends and Additional Amounts. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
general meeting for the above purpose. If the General Partner fails to convene
such meeting within such 30-day period, the holders of 10% in aggregate
liquidation preference of the outstanding Preferred Capital Securities of any
series will be entitled to convene such meeting. The provisions of the
Partnership Agreement relating to the convening and conduct of the general
meetings of partners of United Capital will apply with respect to any such
meeting. Any Special Representative so appointed shall vacate office
immediately if United Capital (or UI, pursuant to the Guarantee) shall have
paid in full all accumulated and unpaid dividends on and any Additional
Amounts in respect of the Preferred Capital Securities of such series or such
Event of Default or default under the Guarantee, as the case may be, shall
have been cured. Notwithstanding the appointment of any such Special
Representative, UI shall retain its rights under the Indenture to extend the
interest payment period as provided under "Description of the Debentures and
the Indenture--Option to Extend Interest Payment Period."
If any proposed amendment to the Partnership Agreement provides for, or the
General Partner otherwise proposes to effect, (i) any action that would
adversely affect the rights, preferences and privileges of the holders of
Preferred Capital Securities of any series, whether by way of amendment to the
Partnership Agreement or otherwise (including, without limitation, the
authorization or issuance of any Limited Partner Interests ranking, as to
participation in the profits or assets of United Capital, senior to the
Preferred Capital Securities of such series or the authorization to dissolve,
liquidate or wind up United Capital) or (ii) the dissolution, liquidation or
winding up of United Capital (other than in connection with a distribution of
Debentures upon, and dissolution of United Capital after, the occurrence of a
Special Event), then holders of outstanding Preferred Capital Securities of
such series will be entitled to vote on such amendment or proposed action of
the General Partner (but not on any other amendment or action) together as a
class with, in the case of an action described in clause (i) above that would
equally adversely affect the rights, preferences or privileges of holders of
any Dividend Parity Securities or any Liquidation Parity Securities, holders
of such Dividend Parity Securities or such Liquidation Parity Securities, as
the case may be, or, in the case of any
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amendment described in clause (ii) above, holders of all Liquidation Parity
Securities, and such amendment or action shall not be effective except with the
approval of the holders of 66 2/3% in aggregate liquidation preference of such
class; provided, however, that no such approval shall be required if the
dissolution, liquidation or winding up of United Capital is proposed or
initiated pursuant to the Partnership Agreement or upon the initiation of
proceedings, or after proceedings have been initiated, for the dissolution,
liquidation or winding up of UI.
The rights of holders of Preferred Capital Securities of any series will be
deemed not to be adversely affected by the creation or issue of, and no vote
will be required for the creation of, any further Limited Partner Interests
ranking junior to, or pari passu with, the Preferred Capital Securities of such
series with regard to participation in the profits or assets of United Capital.
Holders of Limited Partner Interests will have no preemptive rights.
The Partnership Agreement provides that the General Partner will not permit
or cause United Capital to file a voluntary petition in bankruptcy without the
affirmative vote of the holders of 66 2/3% in aggregate liquidation preference
of the outstanding Limited Partner Interests.
If any action is, by the terms of the Indenture, not permitted to be taken by
United Capital without the consent of holders of Limited Partner Interests or
any Special Representative, the General Partner shall not, without such
requisite consent, take any such action.
Any required approval of holders of Preferred Capital Securities of any
series may be given at a separate meeting of such holders convened for such
purpose, at a general meeting of partners of United Capital or pursuant to
written consent. United Capital will cause a notice of any meeting at which
holders of the Preferred Capital Securities of such series are entitled to
vote, or of any matter upon which action by written consent of such holders is
to be taken, to be mailed to each holder of record of the Preferred Capital
Securities of such series. Each such notice will include a statement setting
forth (i) the date of such meeting or the date by which such action is to be
taken, (ii) a description of any matter on which such holders are entitled to
vote or upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the holders of the Preferred Capital Securities will be
required for United Capital to redeem and cancel Preferred Capital Securities
in accordance with the Partnership Agreement.
Notwithstanding that holders of Preferred Capital Securities are entitled to
vote or consent under any of the circumstances described above, the holders of
Preferred Capital Securities that are owned by UI or any affiliate of UI shall
not be entitled to vote or consent, and such Preferred Capital Securities
shall, for the purposes of such vote or consent, be treated as if they were not
outstanding.
ADDITIONAL AMOUNTS
All payments in respect of Preferred Capital Securities by United Capital
will be made without withholding or deduction for or on account of any present
or future taxes, duties, assessments or governmental charges of whatever nature
imposed or levied upon or as a result of such payment by or on behalf of the
United States, any state thereof or any other jurisdiction through which or
from which such payment is made, or any authority therein or thereof having
power to tax, unless the withholding or deduction of such taxes, duties,
assessments or governmental charges is required by law. In the event that any
such withholding or deduction is required as a consequence of (i) the
Debentures not being treated as indebtedness for United States Federal income
tax purposes or (ii) United Capital not being treated as a partnership for
United States Federal income tax purposes, United Capital will pay as a
dividend such additional amounts as may be necessary in order that the net
amounts received by the holders of the Preferred Capital Securities after such
withholding or deduction will equal the amount that would have been receivable
in respect of the Preferred Capital Securities in the absence of such
withholding or deduction ("Additional Amounts"), except that no such Additional
Amounts will be payable to a holder of Preferred Capital Securities (or a third
party on such holder's behalf) if:
(a) such holder is liable for such taxes, duties, assessments or
governmental charges in respect of the Preferred Capital Securities by
reason of such holder's having a connection with the United States,
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any state thereof or any other jurisdiction through which or from which
such payment is made, or in which such holder resides, conducts business or
has other contacts, other than being a holder of Preferred Capital
Securities, or
(b) United Capital or UI has notified such holder of the obligation to
withhold or deduct taxes and requested but not received from such holder a
declaration of non-residence, a valid taxpayer identification number or
other claim for exemption, and such withholding or deduction would not have
been required had such declaration, taxpayer identification number or claim
been received.
BOOK-ENTRY-ONLY ISSUANCE
The Depository Trust Company ("DTC") will initially act as securities
depositary for the Preferred Capital Securities. The Preferred Capital
Securities will be issued only as fully-registered securities registered in the
name of Cede & Co. (DTC's nominee). DTC and any other depositary that may
replace DTC as depositary for the Preferred Capital Securities are sometimes
referred to herein as the "Depositary." One or more fully-registered global
certificates will be issued for each series of Preferred Capital Securities,
representing in the aggregate the total number of Preferred Capital Securities
for such series, and will be deposited with DTC.
DTC 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. DTC
holds securities that its participants ("Participants") deposit with DTC. DTC
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
("Direct Participants") include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations. DTC 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 the DTC 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 ("Indirect Participants"). The rules applicable to DTC
and its Participants are on file with the Commission.
Purchases of Preferred Capital Securities under the DTC system must be made
by or through Direct Participants, which will receive a credit for the
Preferred Capital Securities on DTC's records. The ownership interest of each
actual purchaser of Preferred Capital Securities ("Beneficial Owner") is in
turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from DTC of their
purchases, but Beneficial Owners are expected to receive written confirmations
providing details of the transactions, as well as periodic statements of their
holdings, from the Direct or Indirect Participants through which Beneficial
Owners purchased Preferred Capital Securities. Transfers of ownership interests
in the Preferred Capital Securities are to be accomplished by entries made on
the books of Participants acting on behalf of Beneficial Owners. Beneficial
Owners will not receive certificates representing their ownership interests in
Preferred Capital Securities, except in the event that use of the book-entry
system for the Preferred Capital Securities is discontinued.
To facilitate subsequent transfers, all Preferred Capital Securities
deposited by Participants with DTC are registered in the name of Cede & Co. DTC
has no knowledge of the actual Beneficial Owners of the Preferred Capital
Securities; DTC's records reflect only the identity of the Direct Participants
to whose accounts such Preferred Capital Securities are credited, which may or
may not be Beneficial Owners. Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners, will be
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governed by arrangements among them, subject to any statutory or regulatory
requirements that may be in effect from time to time.
Redemption notices will be sent to Cede & Co. If less than all of the
Preferred Capital Securities of any series are being redeemed, DTC's practice
is to determine by lot the amount of the interest of each Direct Participant in
such series to be redeemed.
Although voting with respect to the Preferred Capital Securities is limited,
in those cases where a vote is required, neither DTC nor Cede & Co. will
consent or vote with respect to Preferred Capital Securities. Under its usual
procedures, DTC would mail its Omnibus Proxy to United Capital as soon as
possible after the record date. The Omnibus Proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts the
Preferred Capital Securities are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
Dividend payments on the Preferred Capital Securities will be made to DTC.
DTC's practice is to credit Direct Participants' accounts on the relevant
payment date in accordance with their respective holdings shown on DTC's
records, unless DTC has reason to believe that it will not receive payments on
such payment date. Payments by Participants to Beneficial Owners will be
governed by standing instructions and customary practices, as is 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 Participant and not of
DTC, United Capital or UI, subject to any statutory or regulatory requirements
that may be in effect from time to time. Payment of dividends to DTC is the
responsibility of United Capital, disbursement of such payments to Direct
Participants is the responsibility of DTC, and disbursement of such payments to
the Beneficial Owners is the responsibility of Direct Participants and Indirect
Participants.
DTC may discontinue providing its services as securities depositary with
respect to the Preferred Capital Securities at any time by giving reasonable
notice to United Capital. Under such circumstances, in the event that a
successor securities depositary is not obtained, certificates for the Preferred
Capital Securities are required to be printed and delivered. Additionally,
United Capital (with the consent of UI) may decide to select another Depositary
for the Preferred Capital Securities or to discontinue use of the system of
book-entry transfers through DTC (or a successor Depositary). In the latter
event, certificates for the Preferred Capital Securities will be printed and
delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from DTC. United Capital and UI believe such information to
be reliable, but neither United Capital nor UI takes any responsibility for the
accuracy thereof.
None of UI, United Capital, any paying agent or any other agent of UI or
United Capital will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in Preferred Capital Securities or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
REGISTRAR, TRANSFER AGENT AND PAYING AGENT
The Bank of New York will act as registrar and co-transfer agent, and UI will
act as co-transfer agent and paying agent, for the Preferred Capital
Securities.
Registration of transfers of Preferred Capital Securities will be effected
without charge by or on behalf of United Capital, but upon payment in respect
of any tax or other governmental charges that may be imposed in relation to it,
together with the giving of such indemnity as United Capital or UI may require.
Neither UI nor United Capital will be required to register or cause to be
registered the transfer of any Preferred Capital Securities that have been
called for redemption.
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DESCRIPTION OF THE GUARANTEE
Set forth below is a summary of certain terms and provisions of the Payment
and Guarantee Agreement that will be executed and delivered by UI for the
benefit of the holders of any series from time to time of the Limited Partner
Interests, including the Preferred Capital Securities (the "Guarantee"). This
summary does not purport to be complete and is subject to, and qualified in its
entirety by reference to, the form of Guarantee filed as an exhibit to the
Registration Statement.
GENERAL
UI will irrevocably and unconditionally agree, to the extent set forth
herein, to pay in full, to the holders of the Limited Partner Interests
(including any series of Preferred Capital Securities), the Guarantee Payments
(as defined below), as and when due, regardless of any defense, right of set-
off or counterclaim that United Capital may have or assert. As used herein,
Guarantee Payments means the following payments, without duplication, to the
extent not paid by United Capital ("Guarantee Payments"): (i) any accumulated
and unpaid dividends on and any Additional Amounts in respect of the Limited
Partner Interests, but only to the extent that United Capital has (a) funds
legally available for the payment of such dividends, as determined by the
General Partner, and (b) cash on hand sufficient to make such payment; (ii) the
Redemption Price payable with respect to Limited Partner Interests called for
redemption by United Capital, but only to the extent that United Capital has
(a) funds legally available for the payment of such Redemption Price, as
determined by the General Partner, and (b) cash on hand sufficient to make such
payment; and (iii) upon a liquidation of United Capital, the lesser of (a) the
Liquidation Distribution and (b) the amount of assets legally available to
United Capital for distribution to holders of Limited Partner Interests. UI's
obligation to make a Guarantee Payment may be satisfied by direct payment of
the required amounts by UI to holders of Limited Partner Interests or by
causing United Capital to pay such amounts to such holders.
If UI fails to make payments of principal of or interest on the Debentures
(including as a result of the extension of any interest payment period for the
Debentures as described under "Description of the Debentures and the
Indenture--Option to Extend Interest Payment Period"), United Capital will not
have sufficient funds to make corresponding payments in respect of the
Redemption Price or the Liquidation Distribution, as the case may be, of, or
dividends on, the Preferred Capital Securities. The Guarantee does not cover
payment of amounts in respect of the Preferred Capital Securities to the extent
that United Capital does not have legally available assets for the payment
thereof and cash on hand sufficient to make such payment. In such event, a
holder of Preferred Capital Securities may enforce certain rights in respect of
the Debentures under the Indenture. See "Description of the Debentures and the
Indenture--Enforcement of Certain Rights by Holders of Preferred Capital
Securities."
CERTAIN COVENANTS OF UI
In the Guarantee, UI will covenant that, so long as any Limited Partner
Interests remain outstanding, UI shall not, and shall not permit any of its
subsidiaries to, declare or pay any dividend on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any capital stock of UI or its
subsidiaries, or make any guarantee payments with respect to the foregoing
(other than payments under the Guarantee), if at such time UI is in default
with respect to its payment or other obligations under the Guarantee or there
has occurred and is continuing any event that would (with notice or the passage
of time or both) constitute an Event of Default under the Indenture.
In the Guarantee, UI will also covenant that, so long as any Limited Partner
Interests remain outstanding, it will (i) maintain direct or indirect ownership
of all interests in United Capital other than such Limited Partner Interests;
(ii) not voluntarily (to the extent permitted by law) dissolve, liquidate or
wind up United Capital; (iii) remain the sole General Partner of United Capital
and timely perform all of its duties as General Partner of United Capital
(including the duty to pay dividends on such Limited Partner Interests and the
duty to pay all costs and expenses of United Capital), provided that any
permitted successor of UI
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under the Indenture may succeed to UI's duties as General Partner; (iv) use its
reasonable efforts to cause United Capital to remain a limited partnership and
otherwise continue to be treated as a partnership for Federal income tax
purposes; and (v) use its best efforts to conduct the affairs of and operate
United Capital in such a way that United Capital would not be an "investment
company" required to be registered under the 1940 Act; provided that UI may
permit United Capital to consolidate or merge with or into another limited
partnership or other permitted successor as described above under "Description
of the Preferred Capital Securities--Merger, Consolidation, Amalgamation, etc.
of United Capital" so long as UI agrees to comply with the covenants described
in clauses (i) through (v) above with respect to such successor limited
partnership or other permitted successor.
ADDITIONAL AMOUNTS
All Guarantee Payments will be made without withholding or deduction for or
on account of any present or future taxes, duties, assessments or governmental
charges of whatever nature imposed or levied upon or as a result of such
payment by or on behalf of the United States, any state thereof or any other
jurisdiction through which or from which such payment is made, or any authority
therein or thereof having power to tax, unless the withholding or deduction of
such taxes, duties, assessments or governmental charges is required by law. In
the event that any such withholding or deduction is required as a consequence
of (i) the Debentures not being treated as indebtedness for United States
Federal income tax purposes or (ii) United Capital not being treated as a
partnership for United States Federal income tax purposes, UI will pay such
additional amounts as may be necessary in order that the net amounts received
by the holders of the Preferred Capital Securities after such withholding or
deduction will equal the amount that would have been receivable in respect of
the Preferred Capital Securities in the absence of such withholding or
deduction, except that no such additional amounts will be payable to a holder
of Preferred Capital Securities (or a third party on such holder's behalf) if:
(a) such holder is liable for such taxes, duties, assessments or
governmental charges in respect of the Preferred Capital Securities by
reason of such holder's having a connection with the United States, any
state thereof or any other jurisdiction through which or from which such
payment is made, or in which such holder resides, conducts business or has
other contacts, other than being a holder of Preferred Capital Securities,
or
(b) United Capital or UI has notified such holder of the obligation to
withhold or deduct taxes and requested but not received from such holder a
declaration of non-residence, a valid taxpayer identification number or
other claim for exemption, and such withholding or deduction would not have
been required had such declaration, taxpayer identification number or claim
been received.
AMENDMENTS AND ASSIGNMENTS
Except with respect to any changes that do not adversely affect the rights of
holders of Limited Partner Interests of any series (in which case no vote will
be required), the Guarantee may be amended only with the prior approval of the
holders of not less than 66 2/3% in aggregate liquidation preference of the
outstanding Limited Partner Interests of each affected series (voting together
as one class). All guarantees and agreements contained in the Guarantee will
bind the successors, assigns, receivers and trustees of UI and will inure to
the benefit of the holders of the Limited Partner Interests. UI may not assign
any of its rights or obligations under the Guarantee, except as contemplated by
and in accordance with the provisions of the Indenture described under
"Description of the Debentures and the Indenture--Merger, Consolidation, Sale,
etc. of UI."
TERMINATION OF GUARANTEE
The Guarantee will terminate and be of no further force and effect upon full
payment of the Redemption Price of all Limited Partner Interests or upon full
payment of the Liquidation Distribution of all Limited Partner Interests upon
liquidation of United Capital. The Guarantee will continue to be effective or
will be reinstated, as the case may be, if at any time any holder of Limited
Partner Interests must restore payment of any sums paid under the Limited
Partner Interests or the Guarantee.
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STATUS OF GUARANTEE
The Guarantee will constitute an unsecured obligation of UI and will rank,
like the Debentures and other Indenture Securities, subordinate in right of
payment to all Senior Indebtedness. The Guarantee provides that each holder of
Limited Partner Interests by acceptance thereof agrees that (1) amounts payable
under the Guarantee will be subordinate in right of payment to amounts payable
upon the Senior Indebtedness to the same extent that amounts payable under the
Indenture and in respect of Indenture Securities (including the Debentures) are
so subordinated and (2) the subordination provisions of the Indenture
applicable to holders of Indenture Securities (including the Debentures) will
be equally applicable to it. For a discussion of the subordination provisions
relating to the Debentures and other Indenture Securities, see "Description of
the Debentures and the Indenture--Subordination."
The Guarantee will constitute a guarantee of payment and not of collection. A
holder of Limited Partner Interests may enforce the Guarantee directly against
UI, and UI will waive any right or remedy to require that any action be brought
against United Capital or any other person or entity before proceeding against
UI. The Guarantee will not be discharged except by payment of the Guarantee
Payments in full to the extent not paid by United Capital and by complete
performance of all obligations under the Guarantee.
GOVERNING LAW
The Guarantee will be governed by and construed and interpreted in accordance
with the laws of the State of New York.
DESCRIPTION OF THE DEBENTURES AND THE INDENTURE
Set forth below is a summary of certain terms and provisions of the Indenture
and the Debentures to be issued thereunder. UI may issue the Debentures to the
public, institutional investors and other purchasers (other than United
Capital) or to United Capital in connection with the investment of the proceeds
from any offering of Preferred Capital Securities. See "Plan of Distribution."
This summary does not purport to be complete and is subject to, and qualified
in its entirety by reference to, the detailed provisions of the forms of
Indenture and Supplemental Indentures establishing the Debentures filed as
exhibits to the Registration Statement. Under certain circumstances following
the occurrence of a Special Event, Debentures may be distributed to the holders
of the corresponding Preferred Capital Securities and United Capital may be
dissolved. See "Description of the Preferred Capital Securities--Special Event
Redemption or Exchange."
GENERAL
The Indenture dated , 1994 between The Bank of New York, as trustee (the
"Indenture Trustee"), and UI (as supplemented from time to time, the
"Indenture") provides that, in addition to the Debentures, additional junior
subordinated deferrable interest debentures may be issued thereunder, without
limitation as to the aggregate principal amount. The Debentures and all other
such debentures hereafter issued under the Indenture are collectively referred
to as the "Indenture Securities." The Indenture does not limit the amount of
other debt, secured or unsecured, that may be issued by UI. The Indenture
Securities will be subordinate and junior to all Senior Indebtedness of UI. As
of June 30, 1994, UI had approximately $1,006 million of Senior Indebtedness
outstanding (exclusive of certain guarantees and other contingent obligations,
but inclusive of capitalized lease obligations and current installments and
short-term notes payable).
OPTIONAL REDEMPTION
Unless otherwise provided in the Prospectus Supplement, UI will have the
right to redeem the Debentures of any series at any time on or after the date
specified in the Prospectus Supplement, in whole or in part, at a redemption
price equal to 100% of the aggregate principal amount of such Debentures to be
redeemed, plus any accrued but unpaid interest (including, in the case of
Debentures corresponding to Preferred Capital Securities, Additional Interest
(as defined herein), if any) to the date fixed for redemption, upon not less
than 30 nor more than 60 days' notice.
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INTEREST
The Debentures of any series will bear interest at the annual rate set forth
in the Prospectus Supplement for such series, accruing from the date they are
issued until paid. Except as may otherwise be provided in the Prospectus
Supplement, such interest will be payable monthly in arrears on the last day of
each calendar month of each year to the holder of record one Business Day prior
to the relevant interest payment date, (except that interest payable at
maturity or upon redemption will be paid to the person to whom principal is
paid), subject to the right of UI to extend any interest payment period as
described below; provided, however, that if the Debentures of any series are
held neither by United Capital nor by a securities depositary, UI shall have
the right to change such record dates. Any overdue principal of and (to the
extent enforceable under applicable law) any overdue installment of interest on
the Debentures of any series will bear interest at the same rate.
The amount of interest payable for any monthly interest payment period will
be computed on the basis of twelve 30-day months and a 360-day year and, for
any period shorter than a full monthly interest period, will be computed on the
basis of the actual number of days elapsed in such period.
In the event that any date on which interest or principal is payable on the
Debentures is not a Business Day, then payment of the amounts payable on such
date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, in the case of any payment in respect of Debentures corresponding to
Preferred Capital Securities, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect, and in the same amount, as if
made on such date.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
UI shall have the right at any time or times during the term of the Indenture
Securities of any series, so long as UI is not in default in the payment of
interest thereunder, to extend interest payment periods for up to 60
consecutive months but not beyond the date on which the principal thereof
becomes due and payable (whether at maturity, by declaration of acceleration,
upon redemption or otherwise), and at, or at any time prior to, the end of any
such extended interest payment period UI will pay all interest then accrued and
unpaid including, if the Indenture Securities of such series correspond to
Limited Partner Interests, Additional Interests, if any, thereon (together with
interest thereon at the rate specified for such Indenture Securities to the
extent permitted by applicable law); provided that, during any such extended
interest payment period, UI shall not, and shall not permit any of its
subsidiaries to, declare or pay any dividend on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any capital stock of UI or its
subsidiaries, or make any guarantee payments with respect to the foregoing
(other than payments under any guarantee by the UI with respect to any capital
stock of any such subsidiary, provided that the proceeds of such capital stock
were used to purchase Indenture Securities); and provided, further, that any
such extended interest payment period may only be selected with respect to
Indenture Securities of any series if an extended interest payment period of
identical length is simultaneously selected for Indenture Securities of all
series. Prior to the end of any such extended interest payment period of less
than 60 consecutive months, UI may further extend the interest payment period;
provided that such extended interest payment period, together with all such
further extensions thereof, may not exceed a period of 60 consecutive months.
Following the termination of any extended interest payment period, if UI has
paid all accrued and unpaid interest required by the Indenture Securities of
all series for such period, UI shall have the right to again extend interest
payment periods for up to 60 consecutive months as herein described. In the
case of any series of the Indenture Securities corresponding to any series of
Limited Partner Interests, so long as United Capital is the sole holder of the
Indenture Securities of such series, UI shall give United Capital notice of its
selection of any such extended interest payment period one Business Day prior
to the earlier of (i) the date dividends on any series of Limited Partner
Interests would otherwise be payable and (ii) the date United Capital is
required to give notice of the record or payment date of such dividends to any
national securities exchange on which any series of Limited Partner Interests
shall be listed or to holders of any series of Limited Partner Interests, but
in any event not less than two Business Days prior to such record date. UI will
cause United Capital to give such notice of UI's selection of any such extended
interest payment period to the holders of
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the Limited Partner Interests. If United Capital is not the sole holder of the
Debentures of any series, UI shall give the holders of Debentures of such
series notice of its selection of such extended interest payment period ten
Business Days prior to the related interest payment date.
ADDITIONAL INTEREST
If at any time United Capital is required to pay any Additional Amounts in
respect of any Preferred Capital Securities pursuant to the terms thereof, as
described under "Description of the Preferred Capital Securities--Additional
Amounts," or in respect of any other Limited Partner Interests pursuant to the
terms thereof, then UI will pay as interest ("Additional Interest") on the
Indenture Securities corresponding to such Limited Partner Interests an amount
equal to such Additional Amounts. In addition, if United Capital shall be
required to pay, with respect to its income derived from the interest payments
on any Indenture Securities corresponding to any Limited Partner Interests, any
amounts for or on account of any taxes, duties, assessments or governmental
charges of whatever nature (other than withholding taxes) imposed by the United
States, or any other taxing authority, then, in any such case, UI will also pay
as Additional Interest on such Indenture Securities such amounts as may be
necessary in order that the net amounts received and retained by United Capital
after the payment of such taxes, duties, assessments or governmental charges
shall result in United Capital's having such funds as it would have had in the
absence of the payment of such taxes, duties, assessments or governmental
charges.
BOOK-ENTRY SYSTEM AND SETTLEMENT
In the event that Debentures are (i) issued to the public, institutional
investors or other purchasers (other than United Capital) or (ii) distributed
to the holders of the Preferred Capital Securities in connection with the
occurrence and continuance of a Special Event, it is anticipated that, in the
case of clause (ii) above, such distribution would occur in book-entry form and
that, in either case, DTC, or any successor Depositary for the Preferred
Capital Securities, would act as securities depositary for such Debentures and
that the depositary arrangements for such Debentures would be substantially
identical to those in effect for the Preferred Capital Securities. For a
description of DTC and the terms of the depositary arrangements relating to
payments, transfers, voting rights, redemption and other notices and other
matters, see "Description of the Preferred Capital Securities--Book-Entry-Only
Issuance."
Except under certain limited circumstances as described under "Description of
the Preferred Capital Securities--Book-Entry-Only Issuance" for delivery of
certificates evidencing beneficial ownership in Preferred Capital Securities,
the Debentures will not be issuable as, or exchangeable for, Debentures in
definitive certificated form. In the event that Debentures are issued in
certificated form, unless otherwise indicated in the Prospectus Supplement,
such Debentures will be in denominations of $25 and integral multiples thereof
and principal and interest on such Debentures will be payable at, and transfers
or exchanges of such Debentures will be effected at, the office or agency of UI
designated for such purposes.
SUBORDINATION
The Indenture will provide that each of the Debentures is subordinate and
junior in right of payment to all Senior Indebtedness. The Indenture defines
"Senior Indebtedness" as all obligations (other than non-recourse obligations
and the indebtedness issued under the Indenture) of, or guaranteed or assumed
by, UI for borrowed money (including both senior and subordinated indebtedness
for borrowed money (other than the Indenture Securities and intercompany debt))
or for the payment of money relating to any lease that is capitalized on the
consolidated balance sheet of UI and its subsidiaries in accordance with
generally accepted accounting principles as in effect from time to time, or
evidenced by bonds, debentures, notes or other similar instruments, and in each
case, amendments, renewals, extensions, modifications and refundings of any
such indebtedness or obligations, whether existing as of the date of the
Indenture or subsequently incurred by UI; provided that UI's obligations under
the Guarantee shall not be deemed to be "Senior Indebtedness" for purposes of
the Indenture (or the Guarantee).
Upon the maturity of any Senior Indebtedness of UI by lapse of time,
acceleration or otherwise, all such Senior Indebtedness then due and owing
shall first be paid in full, before any payment is made on account of, or UI
can acquire, any Indenture Securities (including the Debentures).
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In the event (a) of any insolvency or bankruptcy proceedings, or any
receivership, liquidation, reorganization or other similar proceedings in
respect of UI or a substantial part of its property or of any proceedings for
liquidation, dissolution or other winding up of UI, whether or not involving
insolvency or bankruptcy, or (b) that (i) a default shall have occurred with
respect to the payment of principal of or interest on or other monetary amounts
due and payable on any Senior Indebtedness, or (ii) there shall have occurred a
default (other than a default in the payment of principal or interest, or other
monetary amounts due and payable) in respect of any Senior Indebtedness, as
defined therein or in the instrument under which the same is outstanding,
permitting the holder or holders thereof to accelerate the maturity thereof
(with notice or lapse of time or both), and such default shall have continued
beyond the period of grace, if any, in respect thereof, and, in the cases of
subclauses (i) and (ii) of this clause (b), such default shall not have been
cured or waived or shall not have ceased to exist, or (c) that the principal of
and the accrued interest on the Indenture Securities of any series shall have
been declared due and payable upon an Event of Default and such declaration
shall not have been rescinded and annulled as provided under the Indenture,
then the holders of all Senior Indebtedness shall first be entitled to receive
payment of the full amount due thereon, or provision shall be made for such
payment in money or money's worth, before the holders of any of the Indenture
Securities are entitled to receive a payment on account of the principal of or
any interest on the indebtedness evidenced by their Indenture Securities. Any
payment or distribution, whether in cash, securities or other property, that
would otherwise (but for the subordination provisions) be payable or
deliverable in respect of the Indenture Securities shall be paid or delivered
directly to the holders of such Senior Indebtedness (or their representative or
trustee) in accordance with the priorities then existing among such holders,
until all Senior Indebtedness of UI shall have been paid in full, before any
payment or distribution is made to the holders of Indenture Securities. In the
event that, notwithstanding such subordination provisions, any payment or
distribution of assets of any kind or character is made on the Indenture
Securities before all Senior Indebtedness is paid in full, the Indenture
Trustee or the holders of Indenture Securities receiving such payment will be
required to pay over such payment or distribution to the holders of such Senior
Indebtedness.
No present or future holder of any Senior Indebtedness of UI shall be
prejudiced in the right to enforce subordination of the indebtedness under the
Indenture by any act or failure to act on the part of UI.
Senior Indebtedness will not be deemed to have been paid in full unless the
holders thereof shall have received cash (or securities or other property
satisfactory to such holders) in full payment of such Senior Indebtedness then
outstanding. Upon the payment in full of all Senior Indebtedness, the holders
of Indenture Securities shall be subrogated to all the rights of any holders of
such Senior Indebtedness to receive any further payments or distributions of
cash, property or securities of UI applicable to such Senior Indebtedness until
the Indenture Securities shall have been paid in full, and such payments or
distributions of cash, property or securities received by the holders of
Indenture Securities, by reason of such subrogation, that otherwise would be
paid or distributed to the holders of such Senior Indebtedness, shall, as
between UI and its creditors other than the holders of Senior Indebtedness, on
the one hand, and the holders of Indenture Securities on the other, be deemed
to be a payment on account of Senior Indebtedness, and not on account of the
Indenture Securities.
CERTAIN COVENANTS OF UI
The Indenture will provide that UI shall not, and shall not permit any of its
subsidiaries to, declare or pay any dividend on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any capital stock of UI or its
subsidiaries, or make any guarantee payments with respect to the foregoing
(other than, so long as Preferred Capital Securities of any series remain
outstanding, payments under the Guarantee), if at such time (i) UI will be in
default with respect to its payment or other obligations under the Guarantee
(so long as Preferred Capital Securities of any series remain outstanding),
(ii) there has occurred and is continuing any event that would (with the
passage of time or giving of notice or both) constitute an Event of Default
under the Indenture or (iii) UI has given notice of its election to extend any
interest payment period as provided in the Indenture, and such period, or any
extension thereof, shall be continuing.
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So long as Preferred Capital Securities of any series remain outstanding, it
will (i) maintain direct or indirect ownership of all interests in United
Capital other than Limited Partner Interests; (ii) not voluntarily (to the
extent permitted by law) dissolve, liquidate or wind up United Capital; (iii)
remain the sole General Partner of United Capital and timely perform in all
material respects all of its duties as the General Partner of United Capital
(including the duty to pay dividends on the Preferred Capital Securities as
described in the fourth paragraph under "Description of the Preferred Capital
Securities--Dividends" and the duty to pay all costs and expenses of United
Capital), provided that any permitted successor to UI under the Indenture may
succeed to UI's duties as General Partner; (iv) use reasonable efforts to cause
United Capital to remain a limited partnership and otherwise continue to be
treated as a partnership for Federal income tax purposes; and (v) use its best
efforts to conduct the affairs of and operate United Capital in such a way that
United Capital would not be an "investment company" required to be registered
under the 1940 Act; provided that UI may permit United Capital to consolidate
or merge with or into another limited partnership or other permitted successor
as described above under "Description of the Preferred Capital Securities--
Merger, Consolidation, Amalgamation, etc. of United Capital" so long as UI
agrees to comply with the covenants described in clauses (i) through (v) above
with respect to such successor limited partnership or other permitted
successor.
So long as United Capital holds the Indenture Securities of any series, it
may not waive compliance or waive any default in compliance by UI with any
covenant or other term in Indenture Securities of such series or the Indenture,
or any past default under the Indenture, without the approval or consent of the
holders of at least 66 2/3% in aggregate liquidation preference of the
outstanding Limited Partner Interests affected.
EVENTS OF DEFAULT; REMEDIES
The following events shall constitute Events of Default with respect to each
series of Indenture Securities (including each series of Debentures) issued
under the Indenture:
(a) UI shall fail to pay any interest (including, if the Indenture
Securities of such series correspond to Limited Partner Interests remaining
outstanding, any Additional Interest) on any Indenture Securities of such
series within 15 days after the same becomes due and payable (whether or
not payment is prohibited by the provisions described under "Subordination"
above or otherwise); provided that a valid extension of an interest payment
period by UI shall not constitute a failure to pay interest (other than any
such Additional Interest) for this purpose;
(b) UI shall fail to pay when due any principal of or premium, if any, on
any Indenture Securities of such series, whether at maturity, upon
redemption (unless such redemption is conditioned upon receipt of moneys by
the Trustee on or prior to the date fixed for redemption and such moneys
are not so received), by declaration of acceleration or otherwise (whether
or not payment is prohibited by the provisions described above under
"Subordination" above or otherwise);
(c) UI shall fail to perform or breach any covenant or warranty in the
Indenture (other than a covenant or warranty a default in the performance
of which or breach of which is dealt with elsewhere under this paragraph)
for a period of 30 days after there has been given to UI by the Indenture
Trustee, or to UI and the Indenture Trustee by the holders of at least 25%
in principal amount of outstanding Indenture Securities of such 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," unless the
Indenture Trustee, or the Indenture Trustee and the holders of not less
than the principal amount of Indenture Securities of such series the
holders of which gave such notice, as the case may be, agree in writing to
an extension of such period prior to its expiration;
(d) Certain events relating to reorganization, bankruptcy or insolvency
of UI (or, if the Indenture Securities of such series correspond to Limited
Partner Interests remaining outstanding, United Capital) or the appointment
of a receiver or trustee for its property; or
(e) any other Event of Default specified with respect to Indenture
Securities of such series.
No Event of Default with respect to any series of Indenture Securities
necessarily constitutes an Event of Default with respect to the Indenture
Securities of any other series issued under the Indenture.
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If an Event of Default due to the default in payment of principal of or
interest on any series of Indenture Securities or due to the default in the
performance or breach of any other covenant or warranty of UI applicable to the
Indenture Securities of such series but not applicable to all series occurs and
is continuing, then either the Indenture Trustee, or the holders of 25% in
principal amount of the outstanding Indenture Securities of such series, or, if
the Indenture Securities of such series correspond to Limited Partner
Interests, a Special Representative appointed in respect of such Limited
Partner Interests as described under "Description of the Preferred Capital
Securities--Voting Rights," may declare the principal of all of the Indenture
Securities of such series and interest accrued thereon to be due and payable
immediately (subject to the subordination provisions of the Indenture);
provided that, upon certain events of reorganization, bankruptcy or insolvency
of UI or the appointment of a receiver for its property, the principal of all
of the Indenture Securities and interest accrued thereon shall immediately
become due and payable without any declaration or other action by the Indenture
Trustee or such holders. If an Event of Default due to default in the
performance of any other covenants or agreements in the Indenture applicable to
all outstanding Indenture Securities has occurred and is continuing, either the
Indenture Trustee or the holders of not less than 25% in principal amount of
all outstanding Indenture Securities, considered as one class, or any such
Special Representative or Special Representatives appointed in respect of
series of outstanding Indenture Securities representing not less than 25% in
principal amount of all Indenture Securities then outstanding, and not the
holders of the Indenture Securities of any one of such series or any such
Special Representative appointed in respect of any one series, may make such
declaration of acceleration (subject to the subordination provisions of the
Indenture); provided that, upon certain events of reorganization, bankruptcy or
insolvency of UI or the appointment of a receiver for its property, the
principal of all of the Indenture Securities and interest accrued thereon shall
immediately become due and payable without any declaration or other action by
the Indenture Trustee or such holders.
At any time after the declaration of acceleration with respect to the
Indenture Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained, the Event or Events of
Default giving rise to such declaration of acceleration will, without further
act, be deemed to have been waived, and such declaration and its consequences
will, without further act, be deemed to have been rescinded and annulled, if
(a) UI has paid or deposited with the Indenture Trustee a sum sufficient to pay
(1) all overdue interest on all Indenture Securities of such series, including
interest upon overdue interest at the rate or rates prescribed therefor in such
Indenture Securities to the extent that payment of such interest is lawful; (2)
the principal of and premium, if any, on any Indenture Securities of such
series that have become due otherwise than by such declaration of acceleration
and interest thereon at the rate or rates prescribed therefor in such Indenture
Securities; and (3) all amounts due to the Indenture Trustee under the
Indenture; and (b) any other Event or Events of Default with respect to the
Indenture Securities of such series, other than the nonpayment of the principal
of the Indenture Securities of such series that has become due solely by such
declaration of acceleration, have been cured or waived as provided in the
Indenture.
If an Event of Default with respect to the Indenture Securities of any series
occurs and is continuing, the holders of 25% in principal amount of the
outstanding Indenture Securities of such series or, if the Indenture Securities
of such series correspond to Limited Partner Interests, the Special
Representative appointed in respect of such Limited Partner Interests, if any,
may direct the time, method and place of conducting any proceeding for any
remedy available to the Indenture Trustee or exercising any trust or power
conferred on the Indenture Trustee with respect to the Indenture Securities of
such series; provided, however, that if an Event of Default occurs and is
continuing with respect to more than one series of Indenture Securities, the
holders of 25% in aggregate principal amount of the outstanding Indenture
Securities of all such series, considered as one class, or such Special
Representative or Special Representatives appointed with respect to series of
outstanding Indenture Securities representing 25% in aggregate principal amount
of the outstanding Indenture Securities of all such series, if any, will have
the right to make such direction, and not the holders of the Indenture
Securities of any one of such series or such Special Representative of any one
of such series; and provided, further, that such direction will not be in
conflict with any rule of law or with the Indenture.
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Before proceeding to exercise any right or power under the Indenture at the
direction of such holders or any such Special Representative, the Indenture
Trustee shall be entitled to receive from such holders or any such Special
Representative reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with any such direction.
UI will be required to furnish to the Indenture Trustee annually a statement
of an officer of UI to the effect that, to the best of such officer's
knowledge, UI is not in default in the performance of the terms of the
Indenture or, if such officer has knowledge that UI is in default, specifying
such default.
The Indenture provides that no holder of Indenture Securities issued under
the Indenture may institute any proceeding against UI with respect to the
Indenture unless (a) the holder has previously given to the Indenture Trustee
written notice of a continuing Event of Default and unless the holders of not
less than 25% in principal amount of the Indenture Securities of all series of
Indenture Securities in respect of which an Event of Default has occurred and
is continuing (considered as one class) have requested the Indenture Trustee to
institute such action and shall have offered the Indenture Trustee reasonable
indemnity, (b) the Indenture Trustee shall not have instituted such action
within 60 days of such request and (c) the Indenture Trustee shall not have
received direction inconsistent with such written request by the holders of 25%
in principal amount of the outstanding Indenture Securities of such affected
series (considered as one class). Furthermore, no holder will be entitled to
institute any such action if and to the extent that such action would disturb
or prejudice the rights of other holders of Indenture Securities.
Notwithstanding the foregoing, each holder of an Indenture Security has a
right, which is absolute and unconditional, to receive payment of the principal
of and premium, if any, and interest, subject to the right of UI to extend
interest payment periods in accordance with the Indenture, if any, on such
Indenture Security when due and to institute suit for the enforcement of any
such payment, and such rights may not be impaired without the consent of such
holder.
The Indenture requires the Indenture Trustee to give to all holders of
outstanding Indenture Securities of any series notice of any default to the
extent required by the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), unless such default has been cured or waived; provided that,
in the case of any default of the character specified above in paragraph (c)
under this "Events of Default; Remedies," no such notice will be given to such
holders until at least 15 days after the occurrence thereof. The Trust
Indenture Act currently permits the Indenture Trustee to withhold notices of
default (except for certain payment defaults) if the Indenture Trustee in good
faith determines the withholding of such notice to be in the interests of the
holders.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED CAPITAL SECURITIES
In the case of Debentures corresponding to Preferred Capital Securities of
any series, the holders of the Preferred Capital Securities of such series will
have the rights referred to under "Description of the Preferred Capital
Securities--Voting Rights," including the right under certain circumstances to
appoint a Special Representative, which Special Representative shall be
authorized to exercise United Capital's right to accelerate the principal
amount of such Debentures and to enforce United Capital's other rights under
such Debentures and the Indenture.
In addition, in the case of Debentures corresponding to Preferred Capital
Securities of any series, the Indenture provides that, so long as the Preferred
Capital Securities of such series remain outstanding, the obligations of UI
under such Debentures are for the benefit of the holders of the Preferred
Capital Securities of such series. The holders of the Preferred Capital
Securities of such series, or a Special Representative appointed by and acting
on behalf of such holders, may enforce UI's obligations under the Indenture and
such Debentures directly against UI as a third party beneficiary of UI's
obligations thereunder to the same extent as if such holders held a principal
amount of Debentures equal to the liquidation preference of the Preferred
Capital Securities of such series held by such holders.
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MODIFICATION OF INDENTURE
Without the consent of any holders of Indenture Securities, UI and the
Indenture Trustee may enter into one or more supplemental indentures for any of
the following purposes: (a) to evidence the assumption by any successor to UI
of the covenants of UI in the Indenture and the Indenture Securities; or (b) to
add one or more covenants of UI or other provisions for the benefit of the
holders of all or any series of outstanding Indenture Securities or to
surrender any right or power conferred upon UI by the Indenture; or (c) to add
any additional Events of Default with respect to all or any series of
outstanding Indenture Securities; or (d) to change or eliminate any provision
of the Indenture or to add any new provision to the Indenture, provided that if
such change, elimination or addition will adversely affect the interests of the
holders of Indenture Securities of any series, such change, elimination or
addition will become effective with respect to such series only when there is
no Indenture Security of such series remaining outstanding under the Indenture;
or (e) to provide collateral security for the Indenture Securities; or (f) to
establish the form or terms of Indenture Securities of any series as permitted
by the Indenture; or (g) to evidence and provide for the acceptance of
appointment of a successor Indenture Trustee under the Indenture with respect
to the Indenture Securities of one or more series and to add to or change any
of the provisions of the Indenture as shall be necessary to provide for or to
facilitate the administration of the trusts under the Indenture by more than
one trustee; or (h) to provide for the procedures required to permit the
utilization of a noncertificated system of registration for any series of
Indenture Securities; or (i) to change any place where (1) the principal of and
premium, if any, and interest, if any, on any Indenture Securities shall be
payable, (2) any Indenture Securities may be surrendered for registration of
transfer or exchange, and (3) notices and demands to or upon UI in respect of
Indenture Securities and the Indenture may be served; or (j) to cure any
ambiguity or inconsistency or to make or change any other provisions with
respect to matters and questions arising under the Indenture, provided such
changes or additions shall not adversely affect the interests of the holders of
Indenture Securities of any series.
Without limiting the generality of the foregoing, if the Trust Indenture Act
is amended after the date of the original Indenture in such a way as to require
changes to the Indenture or the incorporation therein of additional provisions
or so as to permit changes to, or the elimination of, provisions that, at the
date of the original Indenture or at any time thereafter, were required by the
Trust Indenture Act to be contained in the Indenture, UI and the Indenture
Trustee may, without the consent of any holders, enter into one or more
supplemental indentures to effect or reflect any such amendment.
Except as otherwise provided above, the consent of the holders of not less
than a majority in aggregate principal amount of the Indenture Securities of
all series then outstanding under the Indenture, considered as one class, is
required for the purpose, pursuant to an indenture or supplemental indenture,
of adding any provisions to, or changing in any manner or eliminating any of
the provisions of, the Indenture or modifying in any manner the rights of the
holders of all such series; provided, however, that if less than all of the
series of Indenture Securities outstanding under the Indenture are directly
affected by a supplemental indenture, then the consent only of the holders of a
majority in aggregate principal amount of the outstanding Indenture Securities
of all series so directly affected, considered as one class, will be required;
and provided, further, that no such supplemental indenture will, without the
consent of the holder of each Indenture Security outstanding under the
Indenture of each such series directly affected thereby, (a) change the stated
maturity of, or any installment of principal of or the rate of interest on or
method of calculating the rate of interest on (or the amount of any installment
of interest on), any Indenture Security, or reduce the principal thereof or
redemption premium thereon, if any, or change the currency in which any
Indenture Security is payable, or impair the right to institute suit for the
enforcement of payment on any Indenture Security; (b) reduce the percentage in
principal amount of the Indenture Securities outstanding under such series (or,
in the case of Indenture Securities corresponding to Limited Partner Interests
of any series, if applicable, in liquidation preference of the Limited Partner
Interests of such series) required to consent to any supplemental indenture or
waiver under the Indenture or to reduce the requirements for quorum and voting;
(c) change the redemption provisions applicable to the Indenture Securities
adversely to the holders thereof; (d) change the
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subordination provisions applicable to the Indenture Securities adversely to
the holders thereof; or (e) modify the provisions in the Indenture relating to
supplemental indentures, waivers of certain covenants and waivers of past
defaults. A supplemental indenture that changes or eliminates any covenant or
other provision of the Indenture that has expressly been included solely for
the benefit of one or more particular series of Indenture Securities, or that
modifies the rights of the holders of Indenture Securities of such series with
respect to such covenant or other provision, shall be deemed not to affect the
rights under the Indenture of the holders of any other Indenture Securities.
Notwithstanding the foregoing, so long as any of the Limited Partner
Interests remain outstanding, United Capital shall not agree to any such
amendment that affects the holders of such Limited Partner Interests then
outstanding, without the prior consent of the holders of not less than 66 2/3%
in aggregate liquidation preference of all such affected Limited Partner
Interests then outstanding considered as one class (or, in the case of changes
described in clauses (a) through (e) of the immediately preceding paragraph,
100% in aggregate liquidation preference of all such affected Limited Partner
Interests then outstanding considered as one class).
SATISFACTION AND DISCHARGE
The Indenture Securities of any series, or any portion of the principal
amount thereof, will be deemed to have been paid for purposes of the Indenture,
and the entire indebtedness of UI in respect thereof will be deemed to have
been satisfied and discharged, if there shall have been irrevocably deposited
with the Indenture Trustee or any paying agent other than UI, in trust: (a)
money in an amount that will be sufficient, or (b) Government Obligations (as
defined below), the principal of and the interest on which when due, without
any regard to reinvestment thereof, will provide monies that, together with the
money, if any, deposited with or held by the Indenture Trustee, will be
sufficient, or (c) a combination of such clauses (a) and (b) that will be
sufficient, to pay when due the principal of and premium, if any, and interest,
if any, due and to become due on such Indenture Securities or portions thereof
on and prior to the maturity thereof. For this purpose, Government Obligations
include direct obligations of, or obligations unconditionally guaranteed by,
the United States of America entitled to the benefit of the full faith and
credit thereof, which do not contain provisions permitting the redemption or
other prepayment thereof at the option of the issuer thereof, and certificates,
depositary receipts or other instruments that evidence a direct ownership
interest in such obligations or in any specific interest or principal payments
due in respect thereof. In connection with such a satisfaction and discharge,
UI, among other things, will deliver to the Trustee an opinion of counsel to
the effect that (i) based upon a ruling to such effect received from or
published by the Internal Revenue Service or a change in the applicable Federal
income tax law, such deposit, and related satisfaction and discharge, would not
cause the holders of the Indenture Securities of such series to recognize
income, gain or loss for Federal income tax purposes (provided that the
Indenture Securities of such series shall be deemed to have been paid for
purposes of the Indenture, but the indebtedness of UI in respect thereof will
not be deemed to have been satisfied and discharged, if such opinion of counsel
is delivered to such effect without either any such ruling or change in law);
and (ii) the trust resulting from such a satisfaction and discharge is a valid
trust and will not constitute an "investment company" under the 1940 Act.
MERGER, CONSOLIDATION, SALE, ETC. OF UI
The Indenture provides that UI may consolidate or merge with, or sell,
convey, transfer or lease its properties and assets substantially as an
entirety to, any other corporation, provided that such successor corporation
expressly assumes all obligations of UI under the Indenture and certain other
conditions are met.
RESIGNATION OR REMOVAL OF INDENTURE TRUSTEE
The Indenture Trustee may resign at any time by giving written notice thereof
to UI, or may be removed at any time by act of the holders of a majority in
principal amount of Indenture Securities then outstanding delivered to the
Indenture Trustee and UI; provided that so long as any Limited Partner
Interests remain
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outstanding United Capital shall not enter into any act to remove the Indenture
Trustee without the consent of the holders of 66 2/3% in aggregate liquidation
preference of such Limited Partner Interests outstanding. No resignation or
removal of the Indenture Trustee and no appointment of a successor trustee will
become effective until the acceptance of appointment by a successor trustee in
accordance with the requirements of the Indenture. So long as no Event of
Default or event that (after notice or lapse of time or both) becomes an Event
of Default has occurred and is continuing, if UI has delivered to the Indenture
Trustee a resolution of UI's Board of Directors appointing a successor trustee
and such successor has accepted such appointment in accordance with the terms
of the Indenture, the Indenture Trustee will be deemed to have resigned and the
successor will be deemed to have been appointed as trustee in accordance with
the Indenture.
CONCERNING THE INDENTURE TRUSTEE
The Bank of New York also serves as trustee under an indenture relating to
certain Senior Indebtedness, under an indenture executed as part of a sale and
leaseback of one of UI's fossil-fuel generating units and under an indenture
executed as part of a sale and leaseback of a portion of UI's interest in
Seabrook Unit 1. The Bank of New York also participates, along with other
banks, in a revolving credit and a term loan agreement, both of which permit UI
to borrow funds on a short-term basis.
REGISTRAR, TRANSFER AGENT AND PAYING AGENT
The Bank of New York will act as co-transfer agent, and UI will act as
registrar, co-transfer agent and its own paying agent, for the Debentures.
Registration of transfers or exchanges of Debentures will be effected without
charge, but UI may require payment of a sum sufficient to cover any tax or
other governmental charge imposed in connection therewith (other than with
certain exchanges not involving any transfer).
UI shall not be required to execute or to provide for the registration of
transfers or exchanges of the Debentures of any series during a period of 15
days immediately preceding the date notice is to be given of the redemption of
the Debentures of such series or any Debenture so selected for redemption in
whole or in part, except the unredeemed portion of any such Debenture being
redeemed in part.
GOVERNING LAW
The Indenture and the Indenture Securities will be governed by and construed
and interpreted in accordance with the laws of the State of New York, without
regard to conflicts of laws principles thereof, except to the extent that the
laws of any other jurisdiction shall be mandatorily applicable.
PLAN OF DISTRIBUTION
UI may sell any series of Debentures, and United Capital may sell any series
of Preferred Capital Securities, through underwriters, dealers or agents,
including Morgan Stanley & Co. Incorporated, or directly, in each case to the
public, institutional investors and other purchasers (including United
Capital). The Prospectus Supplement relating to the Offered Securities of any
series will set forth the terms of such offering, including the names of any
underwriters, dealers or agents involved in the sale of Offered Securities of
such series, the amount of Offered Securities of such series to be purchased by
any underwriters, dealers or agents and any applicable commissions or
discounts. The net estimated proceeds to UI from such series of Offered
Securities will also be set forth in the Prospectus Supplement.
If underwriters are used in the sale, the Offered Securities being sold will
be acquired by the underwriters for their own account and may be resold from
time to time in one or more transactions, including negotiated transactions, at
a fixed public offering price or at varying prices determined at the time of
sale. Unless otherwise set forth in the Prospectus Supplement relating to the
Offered Securities of any series, the obligations of the underwriters to
purchase Offered Securities of such series will be subject to certain
26
<PAGE>
conditions precedent and the underwriters will be obligated to purchase all of
the Offered Securities of such series if any of the Offered Securities of such
series are purchased. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
If dealers are used in the sale, unless otherwise indicated in the Prospectus
Supplement relating to the Offered Securities of any series, United Capital or
UI will sell the Offered Securities of such series to such dealers as
principals. Such dealers may then resell the Offered Securities of such series
to the public at varying prices to be determined by such dealers at the time of
resale.
Offered Securities of any series may also be sold through agents designated
by United Capital or UI from time to time or directly by United Capital or UI.
Any agent involved in the offering and sale of Offered Securities of such
series will be named, and any commissions payable by UI to such agent will be
set forth, in the Prospectus Supplement relating to the Offered Securities of
such series. Unless otherwise indicated in such Prospectus Supplement, any such
agent will act on a reasonable efforts basis for the period of its appointment.
Underwriters, dealers and agents may be entitled under agreements entered
into with UI or United Capital to indemnification by UI or United Capital
against certain civil liabilities, including liabilities under the Securities
Act, or to contribution with respect to payments that the underwriters, dealers
or agents may be required to make in respect thereof. Underwriters, dealers and
agents may be customers of, engage in transactions with, or perform services
for, UI and United Capital in the ordinary course of business.
Each series of Offered Securities will be a new issue of securities and will
have no established trading market. Any underwriter to whom Offered Securities
of any series are sold by UI or United Capital for public offering and sale may
make a market in such series of Offered Securities, but such underwriters will
not be obligated to do so and may discontinue any market making at any time
without notice. If so indicated in the Prospectus Supplement for any series of
Offered Securities, the Offered Securities of such series will be listed on a
national securities exchange. No assurance can be given as to the liquidity of,
or the trading markets for, any Offered Securities.
LEGAL OPINIONS
The validity of the Preferred Capital Securities will be passed upon by
Prickett, Jones, Elliott, Kristol & Schnee, as special Delaware counsel to
United Capital. The validity of the Preferred Capital Securities, the
Debentures and the Guarantee will be passed upon on behalf of UI and United
Capital by Wiggin & Dana, general counsel to UI. The validity of the Preferred
Capital Securities, the Debentures and the Guarantee will be passed upon on
behalf of any underwriters by Winthrop, Stimson, Putnam & Roberts, as counsel
to such underwriters. Certain tax matters in connection with the Preferred
Capital Securities and the Debentures will be passed upon for UI and United
Capital by Reid & Priest, special tax counsel to UI and United Capital. Wiggin
& Dana and Winthrop, Stimson, Putnam & Roberts may rely on the opinion of
Prickett, Jones, Elliott, Kristol & Schnee as to matters of Delaware law.
EXPERTS
The consolidated financial statements and related financial statement
schedules incorporated in this Prospectus by reference to the 1993 Form 10-K
have been audited by Coopers & Lybrand L.L.P., independent accountants, as
stated in their report, which is incorporated herein by reference, and have
been so incorporated in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
27
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Securities and Exchange Commission filing fee......................... $ 34,483
Fees and expenses of Indenture Trustee................................ 15,000*
Legal fees and expenses............................................... 125,000*
Listing fees.......................................................... 47,800*
Rating Agencies fees and expenses..................................... 50,000*
Accounting fees and expenses.......................................... 20,000*
Printing and engraving expenses....................................... 25,000*
Blue Sky fees and expenses............................................ 7,500*
Miscellaneous......................................................... 217*
--------
325,000*
========
</TABLE>
- ------------
* (Estimated)
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 33-320a of the Connecticut Stock Corporation Act, as amended,
provides as follows:
(a) As used in this section:
(1) "Agent" means any person who is or was an agent of the
corporation and any person who, while an agent of the corporation, is
or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another enterprise.
(2) "Corporation" includes any domestic or foreign corporation or any
domestic or foreign predecessor entity of the corporation in a merger,
consolidation or other transaction in which the predecessor's existence
ceased upon consummation of such transaction.
(3) "Director" means any person who is or was a director of the
corporation and any person who, while a director of the corporation, is
or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another enterprise or
as a fiduciary of an employee benefit plan or trust maintained for the
benefit of employees of the corporation or employees of any other
enterprise.
(4) "Eligible Outside Party" means any person who, although not a
shareholder, director, officer, employee or agent of the corporation,
is or was serving solely at the request of the corporation as a
director, officer, partner, trustee, employee or agent of another
enterprise.
(5) "Employee" means any person who is or was an employee of the
corporation and any person who, while an employee of the corporation,
is or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another enterprise or
as a fiduciary of any employee benefit plan or trust maintained for the
benefit of employees of the corporation or employees of any other
enterprise.
(6) "Enterprise" means any other foreign or domestic corporation,
partnership, joint venture, trust or other enterprise, other than an
employee benefit plan or trust.
(7) "Expenses" include attorneys' fees.
(8) "Officer" means any person who is or was an officer of the
corporation and any person who, while an officer of the corporation, is
or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another enterprise or
as a fiduciary of an employee benefit plan or trust maintained for the
benefit of employees of the corporation or employees of any other
enterprise.
II-1
<PAGE>
(9) "Party" includes a person who was, is, or is threatened to be
made, a defendant or respondent in a proceeding.
(10) "Proceeding" means any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative, and shall include any appeal therein.
(11) "Shareholder" means any person who is or was a shareholder of
the corporation and any person who, while a shareholder of the
corporation, is or was serving at the request of the corporation as a
director, officer, partner, trustee, employee or agent of another
enterprise.
(b) Except as otherwise provided in this section, a corporation shall
indemnify any person made a party to any proceeding, other than an action
by or in the right of the corporation, by reason of the fact that he, or
the person whose legal representative he is, is or was a shareholder,
director, officer, employee or agent of the corporation, or an eligible
outside party, against judgments, fines, penalties, amounts paid in
settlement and reasonable expenses actually incurred by him, and the person
whose legal representative he is, in connection with such proceeding. The
corporation shall not so indemnify any such person unless (1) such person,
and the person whose legal representative he is, was successful on the
merits in the defense of any proceeding referred to in this subsection, or
(2) it shall be concluded as provided in subsection (d) of this section
that such person, and the person whose legal representative he is, acted in
good faith and in a manner he reasonably believed to be in the best
interests of the corporation or, in the case of a person serving as a
fiduciary of an employee benefit plan or trust, either in the best
interests of the corporation or in the best interests of the participants
and beneficiaries of such employee benefit plan or trust and consistent
with the provisions of such employee benefit plan or trust and, with
respect to any criminal action or proceeding, that he had no reasonable
cause to believe his conduct was unlawful, or (3) the court, on application
as provided in subsection (e) of this section, shall have determined that
in view of all the circumstances such person is fairly and reasonably
entitled to be indemnified, and then for such amounts as the court shall
determine; except that, in connection with an alleged claim based upon his
purchase or sale of securities of the corporation or of another enterprise,
which he serves or served at the request of the corporation, the
corporation shall only indemnify such person after the court shall have
determined, on application as provided in subsection (e) of this section,
that in view of all circumstances such person is fairly and reasonably
entitled to be indemnified, and then for such amount as the court shall
determine. The termination of any proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its equivalent
shall not, of itself, create a presumption that the person did not act in
good faith or in a manner which he did not reasonably believe to be in the
best interests of the corporation or of the participants and beneficiaries
of such employee benefit plan or trust and consistent with the provisions
of such employee benefit plan or trust, or, with respect to any criminal
action or proceeding, that he had reasonable cause to believe that his
conduct was unlawful.
(c) Except as otherwise provided in this section, a corporation shall
indemnify any person made a party to any proceeding, by or in the right of
the corporation, to procure a judgment in its favor by reason of the fact
that he, or the person whose legal representative he is, is or was a
shareholder, director, officer, employee or agent of the corporation, or an
eligible outside party, against reasonable expenses actually incurred by
him in connection with such proceeding in relation to matters as to which
such person, or the person whose legal representative he is, is finally
adjudged not to have breached his duty to the corporation, or where the
court, on application as provided in subsection (e) of this section, shall
have determined that in view of all the circumstances such person is fairly
and reasonably entitled to be indemnified, and then for such amount as the
court shall determine. The corporation shall not so indemnify any such
person for amounts paid to the corporation, to a plaintiff or to counsel
for a plaintiff in settling or otherwise disposing of a proceeding, with or
without court approval; or for expenses incurred in defending a proceeding
which is settled or otherwise disposed of without court approval.
(d) The conclusion provided for in subsection (b) of this section may be
reached by any one of the following: (1) The board of directors of the
corporation by a consent in writing signed by a majority of those directors
who were not parties to such proceeding; (2) independent legal counsel
selected by a
II-2
<PAGE>
consent in writing signed by a majority of those directors who were not
parties to such proceeding; (3) in the case of any employee or agent who is
not an officer or director of the corporation, the corporation's general
counsel; or (4) the shareholders of the corporation by the affirmative vote
of at least a majority of the voting power of shares not owned by parties
to such proceeding, represented at an annual or special meeting of
shareholders, duly called with notice of such purpose stated. Such person
shall also be entitled to apply to a court for such conclusion, upon
application as provided in subsection (e), even though the conclusion
reached by any of the foregoing shall have been adverse to him or to the
person whose legal representative he is.
(e) Where an application for indemnification or for a conclusion as
provided in this section is made to a court, it shall be made to the court
in which the proceeding is pending or to the superior court for the
judicial district where the principal office of the corporation is located.
The application shall be made in such manner and form as may be required by
the applicable rules of the court or, in the absence thereof, by direction
of the court. The court may also direct that notice be given in such manner
as it may require at the expense of the corporation to the shareholders of
the corporation and to such other persons as the court may designate. In
the case of an application to a court in which a proceeding is pending in
which the person seeking indemnification is a party by reason of the fact
that he, or the person whose legal representative he is, is or was serving
at the request of the corporation as a director, partner, trustee, officer,
employee or agent of another enterprise, or as a fiduciary of an employee
benefit plan or trust maintained for the benefit of employees of any other
enterprise, timely notice of such application shall be given by such person
to the corporation.
(f) Expenses which may be indemnifiable under this section incurred in
defending a proceeding may be paid by the corporation in advance of the
final disposition of such proceeding as authorized by the board of
directors upon agreement by or on behalf of the shareholder, director,
officer, employee, agent or eligible outside party, or his legal
representative, to repay such amount if he is later found not entitled to
be indemnified by the corporation as authorized in this section.
(g) A corporation shall not indemnify any shareholder, director, officer,
employee, agent or eligible outside party, other than a shareholder,
director, officer, employee, agent or eligible outside party who is or was
serving at the request of the corporation as a director, officer, partner,
trustee, employee or agent of another enterprise, against judgments, fines,
penalties, amounts paid in settlement and expenses to an extent either
greater or less than that authorized in this section. No provision made a
part of the certificate of incorporation, the bylaws, a resolution of
shareholders or directors, an agreement, or otherwise on or after October
1, 1982, shall be valid unless consistent with this section.
Notwithstanding the foregoing, the corporation may procure insurance
providing greater indemnification and may share the premium cost with any
shareholder, director, officer, employee, agent or eligible outside party
on such basis as may be agreed upon. The rights and remedies provided in
this section shall be exclusive.
----------------
UI's excess liability insurance policy indemnifies its directors, officers
and employees for any and all sums that they shall be legally obligated to pay
and shall pay or by final judgment be adjudged to pay as damages, judgments,
settlements and costs, charges and expenses arising from any claim or claims
that may be made, and for which the Company has not provided reimbursement, by
reason of such director, officer or employee being or having been a director,
officer or employee of the Company or of another corporation for which such
director, officer or employee is serving or has served at the request of the
Company as a director, officer or employee.
Pursuant to the Partnership Agreement, to the fullest extent permitted by
applicable law, United Capital's limited partners, any affiliate of the general
partner or any officers, directors, shareholders, partners, employees,
representatives or agents of the general partner or any employee or agent of
United Capital or its affiliates ("Indemnified Person") shall be entitled to
indemnification from United Capital for any loss, damage or claim incurred by
such Indemnified Person by reason of any act or omission performed or omitted
by such Indemnified Person in good faith on behalf of United Capital and in a
manner reasonably believed to be
II-3
<PAGE>
within the scope of authority conferred on such Indemnified Person by the
Partnership Agreement, except that no Indemnified Person shall be entitled to
be indemnified in respect of any loss, damage or claim incurred by such
Indemnified Person by reason of gross negligence, recklessness, bad faith or
willful misconduct with respect to such acts or omissions; provided, however,
that any indemnity shall be provided out of and to the extent of United
Capital's assets only, and no general partner, any affiliate of the general
partner or any officers, directors, shareholders, partners, employees,
representatives or agents of the general partner or their respective
affiliates, or any employee or agent of United Capital or its affiliates shall
have any personal liability on account thereof. The Partnership Agreement
further provides that to the fullest extent permitted by applicable law,
expenses (including legal fees) incurred by an Indemnified Person in defending
any claim, demand, action, suit or proceeding may, from time to time, be
advanced by United Capital prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by United Capital of an
undertaking by or on behalf of such Indemnified Person to repay such amount if
it shall be determined that such Indemnified Person is not entitled to be
indemnified as authorized in the provision described in the immediately
preceding sentence.
ITEM 16. LIST OF EXHIBITS.
<TABLE>
<CAPTION>
TABLE
ITEM NO. EXHIBIT NO. DESCRIPTION
-------- ----------- -----------
<C> <C> <S>
(1) 1(a) Form of Underwriting Agreement relating to Preferred
Capital Securities
(1) (b) Form of Underwriting Agreement relating to Debentures
(3) * Certificate of Incorporation of The United Illuminating
Company
(3) + Bylaws of The United Illuminating Company
(4) 4(a) Certificate of Limited Partnership of United Capital
Funding Partnership L.P.
(4) 4(b) Agreement of Limited Partnership of United Capital
Funding Partnership L.P.
(4) 4(c) Form of Amended and Restated Agreement of Limited
Partnership of United Capital Funding Partnership L.P.
(4) 4(d) Form of Action of General Partner creating Series A
Preferred Securities
(4) 4(e) Form of Indenture
(4) 4(f) Form of Supplemental Indenture establishing Debentures
corresponding to Preferred Capital Securities
(4) 4(g) Form of Supplemental Indenture establishing Debentures
(4) 4(h) Form of Preferred Capital Security Certificate--
incorporated by reference to Form of Preferred Capital
Security Certificate contained in Exhibits 4(c) and 4(d)
(4) 4(i) Forms of Debenture--incorporated by reference to Forms
of Debenture contained in Exhibits 4(f) and 4(g)
(4) 4(j) Form of Payment and Guarantee Agreement
(5) 5(a) Opinion of Prickett, Jones, Elliott, Kristol & Schnee--
to be filed by amendment
(5) 5(b) Opinion of Wiggin & Dana--to be filed by amendment
(8) 8 Opinion of Reid & Priest--to be filed by amendment
(12) 12 Statement Showing Computation of Ratios of Earnings to
Fixed Charges and Ratios of Earnings to Combined Fixed
Charges and Preferred Stock Dividend Requirements
(23) 23(a) Consent of Prickett, Jones, Elliott, Kristol & Schnee
(to be included in their opinion filed as Exhibit 5(a))
(23) 23(b) Consent of Wiggin & Dana (to be included in their
opinion filed as Exhibit 5(b))
(23) 23(c) Consent of Reid & Priest (to be included in their
opinion filed as Exhibit 8)
(23) 23(d) Consent of Coopers & Lybrand L.L.P.
(24) 24 Powers of Attorney--included in signature page
(25) 25 Statement of Eligibility of Indenture Trustee under
Trust Indenture Act of 1939.
</TABLE>
- ------------
* Annexed as Exhibits 3.1 through 3.23 to The United Illuminating Company's
Annual Report (Form 10-K) for the fiscal year ended December 31, 1993, and
incorporated herein by reference.
+ Annexed as Exhibits 3.24a, 3.24b and 3.24c to The United Illuminating
Company's Annual Report (Form 10-K) for the fiscal year ended December 31,
1993, and incorporated herein by reference.
II-4
<PAGE>
ITEM 17. UNDERTAKINGS.
A. The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933, as amended (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 this registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or
any material change to such information in this registration statement;
Provided, however, that paragraphs A(1)(i) and A(1)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended, that are incorporated by reference in
this 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 that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned registrants hereby undertake 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
Securities Exchange Act of 1934, as amended, that is incorporated by reference
in this registration statement shall be deemed to be a new registration
statement relating to the securities offered herein, 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
registrants, the registrants have been advised that in the opinion of the
Securities and Exchange 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 registrants of expenses incurred or paid by a director,
officer or controlling person of the registrants 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
registrants will, unless in the opinion of their counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
II-5
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE UNITED
ILLUMINATING COMPANY CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT
IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED
THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, IN THE CITY OF NEW HAVEN AND THE STATE OF
CONNECTICUT, ON THIS DAY OF SEPTEMBER, 1994.
The United Illuminating Company
By /s/ Richard J. Grossi
----------------------------------
RICHARD J. GROSSI
CHAIRMAN OF THE BOARD OF DIRECTORS
AND CHIEF EXECUTIVE OFFICER
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATES INDICATED. EACH PERSON WHOSE SIGNATURE APPEARS BELOW HEREBY CONSTITUTES
RICHARD J. GROSSI, ROBERT L. FISCUS, KURT MOHLMAN AND CHARLES J. PEPE, AND EACH
OF THEM SINGLY, SUCH PERSON'S TRUE AND LAWFUL ATTORNEYS, WITH FULL POWER TO
THEM AND EACH OF THEM TO SIGN, FOR SUCH PERSON AND IN SUCH PERSON'S NAME AND
CAPACITY INDICATED BELOW, ANY AND ALL AMENDMENTS TO THIS REGISTRATION
STATEMENT, HEREBY RATIFYING AND CONFIRMING SUCH PERSON'S SIGNATURE AS IT MAY BE
SIGNED BY SAID ATTORNEY TO ANY AND ALL AMENDMENTS.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Richard J. Grossi Director, Chairman September 13, 1994
- ----------------------------------------- of the Board of
RICHARD J. GROSSI PRINCIPAL Directors and Chief
EXECUTIVE OFFICER Executive Officer
/s/ Robert L. Fiscus Director, President September 13, 1994
- ----------------------------------------- and Chief Financial
ROBERT L. FISCUS PRINCIPAL FINANCIAL Officer
AND ACCOUNTING OFFICER
/s/ John D. Fassett Director September 13, 1994
- -----------------------------------------
JOHN D. FASSETT
/s/ William S. Warner Director September 13, 1994
- ----------------------------------------
WILLIAM S. WARNER
/s/ John F. Croweak Director September 13, 1994
- ----------------------------------------
JOHN F. CROWEAK
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ F. Patrick McFadden. Jr. Director September 13, 1994
- ----------------------------------------
F. PATRICK MCFADDEN, JR.
/s/ J. Hugh Devlin Director September 13, 1994
- ----------------------------------------
J. HUGH DEVLIN
/s/ Betsy Henley-Cohn Director September 13, 1994
- ----------------------------------------
BETSY HENLEY-COHN
/s/ Frank R. O'Keefe, Jr. Director September 13, 1994
- ----------------------------------------
FRANK R. O'KEEFE, JR.
/s/ James A. Thomas Director September 13, 1994
- ----------------------------------------
JAMES A. THOMAS
Director September , 1994
- ----------------------------------------
DAVID E. A. CARSON
/s/ John L. Lahey Director September 13, 1994
- ----------------------------------------
JOHN L. LAHEY
</TABLE>
II-7
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, UNITED CAPITAL
FUNDING PARTNERSHIP L.P. CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE
THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED
THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, IN THE CITY OF NEW HAVEN AND THE STATE OF
CONNECTICUT, ON THIS DAY OF SEPTEMBER, 1994.
United Capital Funding Partnership L.P.
By The United Illuminating Company,
its general partner
By /s/ Richard J. Grossi
-----------------------------------
RICHARD J. GROSSI
PRINCIPAL EXECUTIVE OFFICER
II-8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT NO. DESCRIPTION PAGE NUMBER
----------- ----------- -----------
<C> <S> <C>
1(a) Form of Underwriting Agreement relating to Preferred
Capital Securities
1(b) Form of Underwriting Agreement relating to
Debentures
4(a) Certificate of Limited Partnership of United Capital
Funding Partnership L.P.
4(b) Agreement of Limited Partnership of United Capital
Funding Partnership L.P.
4(c) Form of Amended and Restated Agreement of Limited
Partnership of United Capital Funding Partnership
L.P.
4(d) Form of Action of General Partner creating Series A
Preferred Securities
4(e) Subordinated Debenture Indenture
4(f) Form of Supplemental Indenture establishing
Debentures corresponding to Preferred Capital
Securities
4(g) Form of Supplemental Indenture establishing
Debentures
4(h) Form of Preferred Capital Security Certificate--
incorporated by reference to Form of Preferred
Capital Security Certificate contained in Exhibits
4(c) and 4(d)
4(i) Forms of Subordinated Debenture--incorporated by
reference to Forms of Subordinated Debenture
contained in Exhibits 4(f) and 4(g)
4(j) Form of Payment and Guarantee Agreement
5(a) Opinion of Prickett, Jones, Elliott, Kristol &
Schnee--to be filed by amendment
5(b) Opinion of Wiggin & Dana--to be filed by amendment
8 Opinion of Reid & Priest--to be filed by amendment
12 Statement Showing Computation of Ratios of Earnings
to Fixed Charges and Ratios of Earnings to Combined
Fixed Charges and Preferred Stock Dividend
Requirements
23(a) Consent of Prickett, Jones, Elliott, Kristol &
Schnee (to be included in their opinion filed as
Exhibit 5(a))
23(b) Consent of Wiggin & Dana (to be included in their
opinion filed as Exhibit 5(b))
23(c) Consent of Reid & Priest (to be included in their
opinion filed as Exhibit 8)
23(d) Consent of Coopers & Lybrand L.L.P.
24 Powers of Attorney--included in signature page
25 Statement of Eligibility of Indenture Trustee under
Trust Indenture Act of 1939.
</TABLE>
<PAGE>
EXHIBIT 1(a)
[Form of Underwriting Agreement relating
to Preferred Capital Securities]
UNDERWRITING AGREEMENT
[_____]
UNITED CAPITAL FUNDING PARTNERSHIP L.P.
157 Church Street
New Haven, Connecticut 06506
THE UNITED ILLUMINATING COMPANY
157 Church Street
New Haven, Connecticut 06506
Ladies and Gentlemen:
We (the "Manager") are acting on behalf of the underwriters (including
ourselves) named in Section 3 hereof (the "Underwriters") and we understand that
United Capital Funding Partnership L.P., a Delaware limited partnership (the
"Partnership"), and The United Illuminating Company, a Connecticut corporation,
as general partner of the Partnership and as guarantor (the "Company"), propose
that the Partnership issue and sell [_____] aggregate limited partner interests
in the Partnership of a series designated [__]% Preferred Capital Securities,
Series [__] (liquidation preference $25 per security) (the "Preferred
Securities"), which will be guaranteed pursuant to the Payment and Guarantee
Agreement of the Company (the "Guarantee") as to the payment of dividends
thereon and as to payments on redemption thereof or upon liquidation of the
Partnership, and will be entitled to the benefits of the Company Securities (as
defined below). The proceeds from the sale of the Preferred Securities,
together with the related capital contributions made in respect of outstanding
general partnership interests in the Partnership, will be loaned to the Company
(the "Loan"). The Loan will be evidenced by the Company's junior subordinated
deferrable interest debentures of a series designated [__]% Junior Subordinated
Deferrable Interest Debentures, Series A, Due [_____] (the "Debentures") to be
issued under an Indenture dated as of [_____] (as supplemented by the [_____]
Supplemental Indenture thereto dated as of [_____] (the "Indenture") between the
Company and The Bank of New York, as
<PAGE>
Trustee (the "Trustee"). The Debentures and the Guarantee are hereinafter
referred to collectively as the "Company Securities" and the Preferred
Securities and the Company Securities are hereinafter referred to collectively
as the "Securities."
1. Representations and Warranties. Each of the Partnership and
-------------------------------
the Company jointly and severally represents and warrants to and agrees with
each of the Underwriters that:
(a) The Partnership and the Company have filed with the Securities
and Exchange Commission (the "Commission") a registration statement on Form S-3
(Registration Statement Nos. 33-[_____]), including a prospectus and prospectus
supplement, pursuant to Rule 415 under the Securities Act of 1933, as amended
(the "Securities Act"), relating to the Securities and has filed with, or
transmitted for filing to, or shall promptly hereafter file with or transmit for
filing to, the Commission a prospectus supplement (the "Prospectus Supplement")
specifying the terms of the Securities and the plan of distribution thereof
pursuant to Rule 424 under the Securities Act; and as used herein, (i) the term
"Registration Statement" means the registration statement, including the
exhibits thereto, as amended to the date of this Agreement, (ii) the term "Basic
Prospectus" means the prospectus included in the Registration Statement, (iii)
the term "Prospectus" means the Basic Prospectus together with the Prospectus
Supplement, (iv) the term "preliminary prospectus" means a preliminary
prospectus supplement specifically relating to the Securities, together with the
Basic Prospectus, and (v) the terms "Basic Prospectus," "Prospectus" and
"preliminary prospectus" shall include in each case the documents incorporated
by reference therein and the terms "supplement," "amendment" and "amend" shall
include the documents, if any, deemed to be incorporated by reference in the
Prospectus that are filed subsequent to the date of the Basic Prospectus by the
Partnership or the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
(b) The Registration Statement has become effective; and no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(c) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) the
Registration Statement, when it became effective, did not contain, and, as
amended or supplemented, if applicable, will not contain, any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (iii) the
Registration Statement and the Prospectus comply, and, as amended or
supplemented, if applicable, will comply, in all material
-2-
<PAGE>
respects with the Securities Act and the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), and the respective applicable rules and regulations
of the Commission thereunder and (iv) the Prospectus does not contain, and, as
amended or supplemented, if applicable, will not contain, any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this Section 1(c) do not apply (A) to statements or omissions in the
Registration Statement or the Prospectus based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter expressly
for use therein or (B) to that part of the Registration Statement that
constitutes the Statement of Eligibility (Form T-1) under the Trust Indenture
Act of the Trustee.
(d) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Connecticut, has due
corporate power and authority to own and operate its property and to conduct its
business as described in the Prospectus, to issue the Company Securities, to
execute and deliver, and perform its obligations under, this Agreement, the
Indenture, the Partnership Agreement (as defined in Section 1(k) below) and the
Company Securities, to execute and deliver, on behalf of the Partnership as the
general partner thereof, this Agreement and the Preferred Securities, and to
consummate the transactions herein and therein contemplated; and the Company is
duly qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(e) The Partnership has been duly formed, is validly existing as a
limited partnership in good standing under the laws of the State of Delaware,
has due power and authority to own and operate its property and to conduct its
business as described in the Prospectus, to issue and sell the Preferred
Securities, to make the Loan and acquire the Debentures, to execute and deliver,
and perform its obligations under, this Agreement and the Preferred Securities
and to consummate the transactions herein and therein contemplated; the
Partnership has no subsidiaries and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Partnership; the Partnership is a special
purpose limited partnership as described in the Prospectus and has conducted and
will conduct no business other than the transactions contemplated by this
Agreement and described in the Prospectus; and the
-3-
<PAGE>
Partnership is not a party to or otherwise bound by any contract, agreement or
other instrument other than this Agreement, the Partnership Agreement and the
Certificate of Limited Partnership of the Partnership (the "Partnership
Certificate"), as described in the Prospectus, and is not a party to any action,
suit or proceeding of any nature.
(f) Each subsidiary of the Company (other than the Partnership) has
been duly organized, is validly existing as a corporation or partnership in good
standing under the laws of the jurisdiction of its organization, has the
corporate or partnership power and authority to own its property and to conduct
its business as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(g) This Agreement has been duly authorized, executed and delivered
by each of the Partnership and the Company.
(h) The Preferred Securities have been duly authorized and, when
issued and delivered to and paid for by the Underwriters in accordance with the
provisions of the Partnership Agreement and the terms of this Agreement, will be
validly issued and fully paid and nonassessable limited partner interests in the
Partnership, as to which holders of the Preferred Securities, in their
capacities as limited partners of the Partnership, will have no liability in
excess of their obligations to make payments provided for in the Partnership
Agreement and their share of the Partnership's assets and undistributed profits
(subject to any obligation of a holder of Preferred Securities to repay any
funds wrongfully distributed to it); the Preferred Securities will have the
rights set forth in the Partnership Agreement and the terms of the Preferred
Securities will be valid and binding on the Partnership; and the Preferred
Securities will conform to the description thereof contained in the Prospectus.
(i) The Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, and on the Closing Date will be duly executed
and delivered, by the Company and, when so executed and delivered, will be a
valid and binding agreement of the Company, enforceable in accordance with its
terms subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and
equitable principles of general applicability.
(j) The Debentures have been duly authorized, and on the Closing Date
will be duly executed and delivered, by the Company and, when so executed and
delivered and when executed and authenticated in accordance with the provisions
of the Indenture
-4-
<PAGE>
and delivered to and paid for by the Partnership in accordance with the terms of
the Partnership Agreement in consideration for, and to evidence, the Loan, will
be entitled to the benefits of the Indenture, will rank pari passu without any
---- -----
preference among themselves and subordinate to all Senior Indebtedness (as
defined in the Indenture) and will be valid and binding obligations of the
Company, enforceable in accordance with their terms subject, as to enforcement,
to applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally and equitable principles of general applicability;
and the Indenture and the Debentures will conform to the descriptions thereof
contained in the Prospectus.
(k) The Agreement of Limited Partnership of the Partnership between
the Company, as the sole general partner thereof, and United Resources, Inc., a
Connecticut corporation ("URI"), as the initial limited partner named therein
(as amended and restated on or prior to the Closing Date by the Amended and
Restated Agreement of Limited Partnership of the Partnership among the Company,
as the sole general partner thereof, URI and such other limited partner or
partners party to such Amended and Restated Agreement of Limited Partnership in
accordance with the terms thereof, the "Partnership Agreement"), has been and on
the Closing Date will be duly authorized, executed and delivered by the Company
and is and on the Closing Date will be a valid and binding agreement of the
Company, enforceable in accordance with its terms, subject, as to enforcement,
to applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally and equitable principles of general applicability;
and the Partnership Agreement conforms to the description thereof contained in
the Prospectus.
(l) The Guarantee has been duly authorized, and on the Closing Date
will be duly executed and delivered, by the Company and, when so executed and
delivered, will be a valid and binding agreement of the Company enforceable in
accordance with its terms subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights generally
and equitable principles of general applicability; and the Guarantee will
conform to the description thereof contained in the Prospectus.
(m) Up to the date hereof, the Company has been and is the sole
general partner of the Partnership and URI has been and is the sole limited
partner of the Partnership; as of the Closing Date, the Company will be the sole
general partner of the Partnership and the holders of the Preferred Securities
will be the sole limited partners of the Partnership and URI will withdraw as
limited partner; the Partnership has an authorized capitalization as set forth
in the Prospectus; all of the issued general and limited partner interests in
the Partnership (other than the Preferred Securities) have been duly authorized
and validly issued, are fully paid and non-assessable (other than the general
partnership interest in the Partnership) and conform to
-5-
<PAGE>
the descriptions thereof contained in the Prospectus; and the issued ownership
interests in the Partnership (other than the Preferred Securities) are owned
free and clear of all liens, encumbrances, equities or claims.
(n) The Partnership is not in violation of the Partnership Certificate
or the Partnership Agreement, or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained therein; the
issuance and sale of the Preferred Securities, the making of the Loan and the
acquisition of the Debentures, the execution and delivery of, and the
performance of its obligations under, this Agreement and the Preferred
Securities, in each case by the Partnership, and the consummation of the
transactions herein and therein contemplated will not conflict with, result in a
breach of or constitute a default under any provision of (A) applicable law, (B)
the Partnership Certificate or the Partnership Agreement or (C) any judgment,
order or decree of any governmental body, agency or court having jurisdiction
over the Partnership; and, subject to the approval of the Department of Public
Utility Control of the State of Connecticut (the "DPUC"), no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the issuance and sale of the Preferred Securities, the
making of the Loan and the acquisition of the Debentures or the execution and
delivery of, and the performance of its obligations under, this Agreement or the
Preferred Securities, in each case by the Partnership, or the consummation of
the transactions herein or therein contemplated, except such as may be required
by the securities or Blue Sky laws of the various states in connection with the
offer and sale of the Preferred Securities.
(o) The Company and its subsidiaries (other than the Partnership) are
not in violation of their respective certificates of incorporation or bylaws or
other organizational documents, as the case may be, or in default in the
performance or observance of any material obligation, agreement, covenant or
condition contained in any contract, agreement or other instrument under which
any of them may be bound, the effect of which would have a material adverse
effect on the Company and its subsidiaries, taken as a whole; the issuance and
sale of the Preferred Securities by the Partnership and the issuance of the
Company Securities by the Company, the execution and delivery by the Partnership
of, and the performance by the Partnership of its obligations under, this
Agreement and the Preferred Securities, and the execution and delivery by the
Company of, and the performance by the Company of its obligations under, this
Agreement, the Indenture, the Partnership Agreement and the Company Securities
and the consummation of the transactions herein and therein contemplated, will
not conflict with, result in a breach of or constitute a default under any
provision of (A) applicable law, (B) the certificate of incorporation or bylaws
of the Company, (C) any agreement or other instrument binding upon the Company
or any of its subsidiaries that is material to the
-6-
<PAGE>
Company and its subsidiaries, taken as a whole, or (D) any judgment, order or
decree of any governmental body, agency or court having jurisdiction over the
Company or any subsidiary; and, subject to the approval of the DPUC, no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the issuance of the Company Securities or the
execution and delivery of, and the performance of its obligations under, this
Agreement, the Indenture, the Partnership Agreement or the Company Securities,
in each case by the Company, or the consummation of the transactions herein or
therein contemplated, except such as may be required by the securities or Blue
Sky laws of the various states in connection with the issuance of the Company
Securities.
(p) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, or the Partnership, from that
set forth in the Prospectus.
(q) There are no legal or governmental proceedings pending or
threatened to which the Partnership, or the Company or any of its other
subsidiaries, is a party or to which any of the properties of the Partnership,
or the Company or any of its other subsidiaries, is subject that are required to
be described in the Registration Statement or the Prospectus and are not so
described or any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the Prospectus or to
be filed or incorporated by reference as exhibits to the Registration Statement
that are not described, filed or incorporated as required.
(r) Neither the Partnership nor the Company is an "investment company"
or an entity "controlled" by an "investment company," as such terms are defined
in the Investment Company Act of 1940, as amended.
(s) The Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
-7-
<PAGE>
(t) In the ordinary course of its business, the Company conducts a
periodic review of the effect of Environmental Laws on the business, operations
and properties of the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties); and on the basis of such review, the Company has
reasonably concluded that such associated costs and liabilities would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(u) The Partnership and the Company have complied with all provisions
of Section 517.075, Florida Statutes (Chapter 92-198, Laws of Florida).
2. Public Offering. The Partnership and the Company are advised by
---------------
the Manager that the Underwriters propose to make a public offering of their
respective portions of the Preferred Securities as soon after this Agreement has
been entered into as in the judgment of the Manager is advisable. The terms of
the public offering of the Preferred Securities are set forth in the Prospectus.
3. Purchase and Delivery. Subject to the terms and conditions set
---------------------
forth or incorporated by reference herein, the Partnership hereby agrees to sell
and the Underwriters agree to purchase, severally and not jointly, the
respective number of Preferred Securities set forth below opposite their names
at a purchase price of $25 per Preferred Security:
<TABLE>
<CAPTION>
Number of
Name Preferred Securities
---- --------------------
<S> <C>
Morgan Stanley & Co.
Incorporated [ ]
[ ]
----------------
Total . . . . . . . . . . . . . . . . [ ]
================
</TABLE>
The Company agrees to issue the Company Securities concurrently with
the issue and sale of the Preferred Securities as contemplated herein. The
Company hereby guarantees the timely performance by the Partnership of its
obligations under this Section 3. The Partnership agrees to purchase the
Debentures with the proceeds of, and concurrently with, the issue and sale of
the Preferred Securities.
As compensation to the Underwriters for their commitments hereunder,
and because the proceeds of the sale of the Preferred Securities will be loaned
by the Partnership to the Company, the Company hereby agrees to pay on the
Closing Date to
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<PAGE>
the Manager, for the accounts of the several Underwriters, an amount equal to
(i) in the case of such number of Preferred Securities as are reserved by the
Underwriters for sale to institutional investors, $[__] per Preferred Security
and (ii) in the case of such number of Preferred Securities as are not so
reserved, $[__] per Preferred Security. The Underwriters shall inform the
Company in writing, not later than the business day prior to the Closing Date,
of the number of Preferred Securities reserved for sale to such institutional
investors.
The Underwriters will pay for the Preferred Securities upon delivery
thereof at the offices of Winthrop, Stimson, Putnam & Roberts, One Battery Park
Plaza, New York, New York at 10:00 a.m. (New York time) on [_____], or at such
other time as the Partnership, the Company and the Manager shall mutually agree
upon. The time and date of such payment and delivery are hereinafter referred
to as the "Closing Date." Except as otherwise provided in this Section 3,
payment for the Preferred Securities shall be made by certified or official bank
check or checks payable to the order of the Partnership in New York Clearing
House funds at the time and place set forth in this Agreement, upon delivery to
the Manager for the respective accounts of the several Underwriters of Preferred
Securities, registered in such names and in such denominations as the Manager
shall request in writing not less than two full business days prior to the date
of delivery, with any transfer taxes payable in connection with the transfer of
the Preferred Securities to the Underwriters duly paid.
4. Conditions to Closing. The several obligations of the
---------------------
Underwriters hereunder are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction of
the possible change, in the rating accorded the Preferred Securities or any
of the Company's securities (including the Company Securities) by any
"nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
(ii) there shall neither have occurred an Investment Company
Event nor a Tax Event (as such terms are defined in the Partnership
Agreement, except that the specified dates referred to therein shall be the
date of this Agreement);
(iii) there shall not have occurred any change, or any
development involving a prospective change, in the
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<PAGE>
condition, financial or otherwise, or in the earnings, business or
operations, of the Company and its subsidiaries, taken as a whole, or of
the Partnership from that set forth in the Prospectus, that, in the
judgment of the Manager, is material and adverse and that makes it, in the
judgment of the Manager, impracticable to market the Preferred Securities
on the terms and in the manner contemplated in the Prospectus; and
(iv) the Company shall have obtained an appropriate order of the
DPUC authorizing the issuance, sale and delivery of the Company Securities
as contemplated by this Agreement, which at the Closing Date shall be in
full force and effect and shall not be contested or the subject of review
or appeal.
(b) The Manager shall have received on the Closing Date a certificate
of each of the Partnership and the Company, dated the Closing Date and signed by
an executive officer of the general partner of the Partnership and the Company,
respectively, to the effect set forth in clauses (a)(i) and (iv) above and to
the effect that the representations and warranties of the Partnership and the
Company, respectively, contained in this Agreement are true and correct as of
the Closing Date and that each of the Partnership and the Company, respectively,
has complied with all of the agreements and satisfied all of the conditions on
its part to be performed or satisfied on or before the Closing Date. The
officer signing and delivering each such certificate may rely upon the best of
such officer's knowledge as to proceedings threatened.
(c) The Manager shall have received on the Closing Date an opinion of
Wiggin & Dana, counsel for the Company and the Partnership, dated the Closing
Date, to the effect that:
(i) the Partnership has been duly formed, is validly existing
as a limited partnership in good standing under the laws of the State of
Delaware, has due power and authority to own and operate its property and
to conduct its business as described in the Prospectus and to issue and
sell the Preferred Securities, to make the Loan and acquire the Debentures,
to execute and deliver, and perform its obligations under, this Agreement
and the Preferred Securities and to consummate the transactions herein and
therein contemplated; the Partnership is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect on the
Partnership; the Partnership is a special purpose limited partnership as
described in the Prospectus and has conducted no business other than the
transactions contemplated by this Agreement and described in
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<PAGE>
the Prospectus; and the Partnership is not a party to or otherwise bound by
any contract, agreement or other instrument other than this Agreement, the
Partnership Agreement and the Partnership Certificate, as described in the
Prospectus, and is not a party to any action, suit or proceeding of any
nature;
(ii) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Connecticut, has the corporate power and authority to own and operate its
property and to conduct its business as described in the Prospectus and to
issue the Company Securities, to execute and deliver, and perform its
obligations under, this Agreement, the Indenture, the Partnership Agreement
and the Company Securities, to execute and deliver, on behalf of the
Partnership as the general partner thereof, this Agreement and the
Preferred Securities and to consummate the transactions herein and therein
contemplated; and the Company is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(iii) each subsidiary of the Company (other than the
Partnership) has been duly organized, is validly existing as a corporation
or partnership in good standing under the laws of the jurisdiction of its
organization, has the corporate or partnership power and authority to own
its property and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole;
(iv) as of the Closing Date, the Company has been and is the
sole general partner of the Partnership and the holders of the Preferred
Securities are the sole limited partners and there are no other partners of
the Partnership; the Partnership has an authorized capitalization as
described in the Prospectus; all of the issued general and limited partner
interests in the Partnership (other than the Preferred Securities) have
been duly authorized and validly issued, are fully paid and nonassessable
(other than the general partner interest in the Partnership); and all of
the issued ownership interests in the Partnership (other than the Preferred
Securities) are owned directly by the Company, free and clear of all liens,
encumbrances, equities and claims;
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<PAGE>
(v) the Preferred Securities have been duly authorized and,
when issued and delivered to and paid for by the Underwriters in accordance
with the provisions of the Partnership Agreement and this Agreement, will
be validly issued, fully paid and nonassessable limited partner interests
in the Partnership, as to which holders of the Preferred Securities, in
their capacities as limited partners of the Partnership, will have no
liability in excess of their obligations to make payments provided for in
the Partnership Agreement and their share of the Partnership's assets and
undistributed profits (subject to any obligation of a holder of Preferred
Securities to repay any funds wrongfully distributed to it); the Preferred
Securities have the rights set forth in the Partnership Agreement and the
terms of the Preferred Securities are valid and binding on the Partnership;
and holders of the Preferred Securities will have no preemptive rights;
(vi) the execution and delivery of, and the performance under,
this Agreement has been duly authorized, and this Agreement has been duly
executed and delivered, by each of the Partnership and the Company;
(vii) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement of the Company enforceable in
accordance with its terms subject, as to enforcement, to applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally and equitable principles of general applicability;
(viii) the Debentures have been duly authorized and, when
executed and authenticated in accordance with the provisions of the
Indenture and delivered to and duly paid for by the Partnership in
accordance with the terms of the Partnership Agreement in consideration for
and to evidence the Loan, will be entitled to the benefits of the
Indenture, will rank pari passu without any preference among themselves and
---- -----
subordinate to all Senior Indebtedness and will be valid and binding
obligations of the Company enforceable in accordance with their terms
subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and
equitable principles of general applicability;
(ix) the Partnership Agreement has been duly authorized,
executed and delivered by the Company and is a valid and binding agreement
of the Company, enforceable in accordance with its terms, subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally and equitable principles
of general applicability;
-12-
<PAGE>
(x) the Guarantee has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company, enforceable in accordance with its terms subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization and
similar laws affecting creditors' rights generally and equitable principles
of general applicability;
(xi) the Partnership is not in violation of the Partnership
Certificate or the Partnership Agreement, or in default in the performance
or observance of any material obligation, agreement, covenant or condition
contained therein; the issuance and sale of the Preferred Securities, the
making of the Loan and the acquisition of the Debentures or the execution
and delivery of, and the performance of its obligations under, this
Agreement and the Preferred Securities, in each case by the Partnership, or
the consummation of the transactions herein and therein contemplated will
not conflict with, result in a breach of or constitute a default under any
provision of (A) applicable law, (B) the Partnership Certificate or the
Partnership Agreement or (C) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Partnership; and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
issuance and sale of the Preferred Securities, the making of the Loan and
the acquisition of the Debentures or the execution and delivery of, and the
performance of its obligations under, this Agreement or the Preferred
Securities, in each case by the Partnership, or the consummation of the
transactions herein or therein contemplated, except such as may be required
by the securities or Blue Sky laws of the various states in connection with
the offer and sale of the Preferred Securities;
(xii) the Company and its subsidiaries (other than the
Partnership) are not in violation of their respective certificates of
incorporation or bylaws or other organizational documents, as the case may
be, or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
agreement or other instrument by which any of them may be bound, the effect
of which would have a material adverse effect on the Company and its
subsidiaries, taken as a whole; the issuance and sale of the Preferred
Securities by the Partnership and the issuance of the Company Securities by
the Company, the execution and delivery by the Partnership of, and the
performance by the Partnership of its obligations under, this Agreement and
the Preferred Securities and the execution and delivery by the Company of,
and the performance by the Company of its obligations under, this
Agreement, the Indenture, the Partnership Agreement and the Company
Securities and the consummation of the
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transactions herein and therein contemplated will not conflict with, result
in a breach of or constitute a default under any provision of (A)
applicable law, (B) the certificate of incorporation or bylaws of the
Company, (C) to the best of such counsel's knowledge, after due inquiry,
any agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries, taken as
a whole, or (D) to the best of such counsel's knowledge, after due inquiry,
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any of its subsidiaries; the
Company has obtained an appropriate order of the DPUC authorizing the
issuance, sale and delivery of the Company Securities as contemplated by
this Agreement, which order is in full force and effect, has not been
contested and is not the subject of review or appeal; and no other consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the issuance of the Company
Securities, the execution and delivery of, and the performance of its
obligations under, this Agreement, the Indenture, the Partnership Agreement
or the Company Securities, in each case by the Company, or the consummation
of the transactions herein or therein contemplated, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the issuance of the Company Securities;
(xiii) (A) the Registration Statement meets the requirements
set forth in Rule 415(a)(1)(ix) or (x) under the Securities Act and
complies in all material respects with said Rule; (B) the Registration
Statement has become effective and no stop order suspending the
effectiveness of the Registration Statement is in effect, nor are
proceedings for such purpose pending before or, to the best of such
counsel's knowledge, threatened by the Commission; (C) the Prospectus has
been transmitted in a manner reasonably calculated to result in filing with
the Commission in accordance with Rule 424(b) of the Securities Act; and
(D) the statements (1) in the Prospectus Supplement under the captions
"Certain Terms of the Series A Preferred Capital Securities," "Certain
Terms of the Series A Debentures" and "Underwriting," (2) in the Basic
Prospectus under the captions "Description of the Preferred Capital
Securities," "Description of the Guarantee," "Description of the Debentures
and the Indenture" and "Plan of Distribution," (3) in the Registration
Statement under Item 15, (4) in "Item 3 - Legal Proceedings" of the
Company's most recent annual report on Form 10-K incorporated by reference
in the Prospectus and (5) in "Item 1 - Legal Proceedings" of Part II of the
Company's quarterly reports on Form 10-Q filed since such annual report, in
each case insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly present
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the information called for with respect to such legal matters, documents
and proceedings and fairly summarize the matters referred to therein;
(xiv) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which the
Company, the Partnership or any of the Company's other subsidiaries is a
party or to which any of the properties of the Company, the Partnership or
any of the Company's other subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and are not so
described or of any statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement that are not described, filed or incorporated as
required;
(xv) neither the Partnership nor the Company is an "investment
company" or an entity "controlled" by an "investment company," as those
terms are defined in the Investment Company Act; and
(xvi) such counsel (A) is of the opinion that each document
filed pursuant to the Exchange Act and incorporated by reference in the
Prospectus (except for financial statements and schedules included therein
as to which such counsel need not express any opinion) complied when so
filed as to form in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (B) believes
that (except for financial statements and schedules as to which such
counsel need not express any belief and except for that part of the
Registration Statement that constitutes the Statement of Eligibility (Form
T-1) under the Trust Indenture Act of the Trustee) the Registration
Statement, when it became effective did not, and, as of the date such
opinion is delivered, does not, contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (C) is of the
opinion that the Registration Statement and the Prospectus (except for
financial statements and schedules included therein as to which such
counsel need not express any opinion) comply as to form in all material
respects with the Securities Act and the Trust Indenture Act and the
applicable rules and regulations of the Commission thereunder and (D)
believes that (except for financial statements and schedules as to which
such counsel need not express any belief) the Prospectus as of the date
such opinion is delivered does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
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<PAGE>
In rendering such opinion, Wiggin & Dana may rely (A) as to matters of
fact, to the extent deemed proper, on certificates of responsible officers of
the Company, on behalf of itself and as general partner of the Partnership, and
the Company's subsidiaries and public officials, (B) as to matters involving the
application of the laws of the State of Delaware, upon the opinion of Prickett,
Jones, Elliott, Kristol & Schnee rendered pursuant to Section 4(d) and (C) as to
matters involving the application of the laws of the State of New York, upon the
opinion of Winthrop, Stimson, Putnam & Roberts rendered pursuant to Section
4(e). With respect to paragraph (xvi) of this Section 4(c), Wiggin & Dana may
state that their opinion and belief are based upon their participation in the
preparation of the Registration Statement and the Prospectus and any amendments
or supplements thereto and documents incorporated therein by reference and
review and discussion of the contents thereof, but are without independent check
or verification, except as specified. The opinion of Wiggin & Dana described in
this Section 4(c) shall be rendered to the Manager at the request of the Company
and shall so state therein.
(d) The Manager shall have received on the Closing Date an opinion of
Prickett, Jones, Elliott, Kristol & Schnee, special Delaware counsel for the
Partnership, dated the Closing Date, to the effect that:
(i) the Partnership has been duly formed, is validly existing
as a limited partnership in good standing under the laws of the State of
Delaware, has due power and authority to own and operate its property and
to conduct its business as described in the Prospectus and to issue and
sell the Preferred Securities, to make the Loan and acquire the Debentures,
to execute and deliver, and perform its obligations under, this Agreement
and the Preferred Securities and to consummate the transactions herein and
therein contemplated;
(ii) as of the Closing Date, the Company has been and is the
sole general partner of the Partnership; the Partnership has an authorized
capitalization as described in the Prospectus; and all of the issued
general and limited partner interests in the Partnership (other than the
Preferred Securities) have been duly authorized and validly issued, are
fully paid and nonassessable (other than the general partner interest in
the Partnership) and conform as to legal matters to the descriptions
thereof contained in the Prospectus;
(iii) the Preferred Securities have been duly authorized and,
when issued and delivered to and paid for by the Underwriters in accordance
with the provisions of the Partnership Agreement and this Agreement, will
be validly issued, fully paid and nonassessable limited partner interests
in the Partnership, as to which holders of the
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Preferred Securities, in their capacities as limited partners of the
Partnership, will have no liability in excess of their obligations to make
payments provided for in the Partnership Agreement and their share of the
Partnership's assets and undistributed profits (subject to any obligation
of a holder of Preferred Securities to repay any funds wrongfully
distributed to it); the Preferred Securities have the rights set forth in
the Partnership Agreement and the terms of the Preferred Securities are
valid and binding on the Partnership; holders of the Preferred Securities
will have no preemptive rights; and the Preferred Securities will conform
as to legal matters to the description thereof contained in the Prospectus;
(iv) the Partnership Agreement is a valid and binding agreement
of the Company, enforceable in accordance with its terms subject, as to
enforcement, to applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally and equitable principles
of general applicability; and the Partnership Agreement conforms as to
legal matters to the description thereof contained in the Prospectus;
(v) the execution and delivery of, and the performance under,
this Agreement has been duly authorized by the Partnership;
(vi) the issuance and sale of the Preferred Securities, the
making of the Loan and the acquisition of the Debentures or execution and
delivery of, and the performance of its obligations under, this Agreement
and the Preferred Securities, in each case by the Partnership, or the
consummation of the transactions herein and therein contemplated will not
conflict with, result in a breach of or constitute a default under any
provision of (A) Delaware law, (B) the Partnership Certificate or the
Partnership Agreement or (C) any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Partnership
of which such counsel has knowledge; and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency of the State of Delaware is required for the issuance and sale of
the Preferred Securities, the making of the Loan and the acquisition of the
Debentures or the execution and delivery of, and the performance of its
obligations under, this Agreement or the Preferred Securities, in each case
by the Partnership, or the consummation of the transactions herein or
therein contemplated, except such as may be required by the securities or
Blue Sky laws of the State of Delaware in connection with the offer and
sale of the Preferred Securities;
(vii) such counsel has reviewed the statements in the
Prospectus Supplement under the captions "United Capital
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<PAGE>
Funding Partnership L.P." and "Certain Terms of the Series A Preferred
Capital Securities" and in the Basic Prospectus under the captions "United
Capital Funding Partnership L.P." and "Description of the Preferred Capital
Securities" and, in each case insofar as it contains statements of Delaware
law, such statements are fairly presented; and
(viii) assuming that the Partnership (A) is treated as a
partnership for Federal income tax purposes, (B) derives no income from or
connected with sources within the State of Delaware and (C) has no assets,
activities (other than the maintenance of a registered office and
registered agent in the State of Delaware and the filing of documents with
the Delaware Secretary of State) or employees in the State of Delaware,
holders of the Preferred Securities (other than such holders who reside or
are domiciled in the State of Delaware) will have no liability for Delaware
income taxes solely as a result of their participation in the Partnership,
and the Partnership will not be liable for any Delaware income tax.
In rendering such opinion, Prickett, Jones, Elliott, Kristol & Schnee may (A)
limit the matters set forth therein to those involving the application of the
laws of the State of Delaware and (B) rely as to matters of fact, to the extent
deemed proper, on certificates of responsible officers of the Company, on behalf
of itself and as general partner of the Partnership, and the Company's
subsidiaries and public officials. The opinion of Prickett, Jones, Elliott,
Kristol & Schnee described in this Section 4(d) shall be rendered to the Manager
at the request of the Company and shall so state therein.
(e) The Manager shall have received on the Closing Date an opinion of
Reid & Priest, special tax counsel for the Partnership, dated the Closing Date,
in form and substance satisfactory to the Manager, confirming its opinion set
forth in the Prospectus Supplement under the caption "United States Income
Taxation." The opinion of Reid & Priest described in this Section 4(e) shall be
rendered to the Manager at the request of the Company and shall so state
therein.
(f) The Manager shall have received on the Closing Date an opinion of
Winthrop, Stimson, Putnam & Roberts, special counsel for the Underwriters, dated
the Closing Date, covering such matters as the Manager shall reasonably request
and the Partnership and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon such
matters. In rendering such opinion, Winthrop, Stimson, Putnam & Roberts may
rely (i) as to matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company, on behalf of itself and as general partner
of the Partnership, and the Company's subsidiaries and public officials, (ii) as
to matters involving the application of the laws of the State of Connecticut,
upon the opinion of Wiggin & Dana rendered
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<PAGE>
pursuant to Section 4(c) and (iii) as to matters involving the application of
the laws of the State of Delaware, upon the opinion of Prickett, Jones, Elliott,
Kristol & Schnee rendered pursuant to Section 4(d).
(g) The Manager shall have received on the date of this Agreement a
letter, dated the date of this Agreement, in form and substance satisfactory to
the Manager, from Coopers & Lybrand, the Company's independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference into the Prospectus.
(h) The Manager shall have received on the Closing Date a letter,
dated the Closing Date, in form and substance satisfactory to the Manager, from
Coopers & Lybrand, the Company's public accountants, to the effect that such
accountants reaffirm, as of the Closing Date, and as though made on the Closing
Date, the statements made in the letter furnished by such accountants pursuant
to Section 4(g), except that the specified date referred to therein shall be a
date not more than five business days prior to the Closing Date.
(i) On the Closing Date, the Company shall have paid, or cause to have
been paid, the compensation payable to the Underwriters under Section 3 by
certified or official bank check or checks in New York Clearing House Funds.
(j) Moody's Investors Service, Inc. and Standard & Poor's Ratings
Group shall have publicly assigned to the Preferred Securities ratings of [__]
and [__], respectively, which ratings shall be in full force and effect on the
Closing Date.
5. Covenants of the Partnership and the Company. In further
--------------------------------------------
consideration of the agreements of the Underwriters herein contained, each of
the Partnership and the Company jointly and severally covenants as follows:
(a) To furnish the Manager, without charge, a signed copy of the
Registration Statement (including exhibits thereto) and, during the period
mentioned in Section 5(c), as many copies of the Prospectus, any documents
incorporated by reference therein and any supplements and amendments thereto or
to the Registration Statement as the Manager may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to the Manager a copy of each such proposed amendment or
supplement for their review a reasonable amount of time prior to the filing
thereof.
(c) If, during such period after the first date of the public offering
of the Securities as in the opinion of counsel
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<PAGE>
for the Underwriters a prospectus relating to the Securities is required by law
to be delivered in connection with sales by an Underwriter or dealer, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters, it is
necessary to amend or supplement the Prospectus to comply with law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to the
Underwriters, and to the dealers (whose names and addresses the Manager will
furnish to the Company) to which Securities may have been sold by the Manager
and to any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus, as amended or
supplemented, will comply with law.
(d) To endeavor to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Manager shall
reasonably request and to maintain such qualification for as long as the Manager
shall reasonably request.
(e) In the case of the Company, to make generally available to its
security holders and to the Manager as soon as practicable an earning statement
covering a twelve month period beginning on the first day of the first full
fiscal quarter after the date of this Agreement, which earning statement shall
satisfy the provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder. If such twelve month period is
coterminous with the Company's fiscal year, such earnings statement shall be
made available not later than 90 days after the close of the period covered
thereby and in all other cases shall be made available not later than 45 days
after the close of the period covered thereby.
(f) In the case of the Company, to issue the Company Securities
concurrently with the issue and sale of the Preferred Securities as contemplated
herein.
(g) During the period beginning on the date of this Agreement and
continuing to and including the date that is 90 days after the Closing Date, not
to offer, sell, contract to sell or otherwise dispose of any securities of the
Partnership that are substantially similar to the Preferred Securities, any
other shares of capital stock of the Partnership, any preferred stock or
subordinated debentures of the Company or any of the Company's other
subsidiaries or any other securities convertible into or exchangeable for
Preferred Securities, any securities substantially similar to the Preferred
Securities or the Debentures, or warrants to purchase any of such securities
(other than Debentures distributed to holders of Preferred Securities as
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<PAGE>
contemplated by the Prospectus), without the prior written consent of the
Manager.
(h) To take, or cause to be taken, all actions necessary or advisable
to effect the listing and admission for trading of the Preferred Securities on
the New York Stock Exchange and the registration thereof under the Exchange Act.
(i) In the case of the Company, to use its best efforts to list the
Debentures on the New York Stock Exchange and register the Debentures under the
Exchange Act, upon any distribution of Debentures to holders of Preferred
Securities as contemplated by the Prospectus.
(j) Whether or not any sale of Securities is consummated, to pay all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the preparation and filing of the Registration Statement and the
Prospectus and all amendments and supplements thereto, (ii) the preparation,
issuance and delivery of the Securities, (iii) the fees and disbursements of the
Partnership's and the Company's counsel and accountants and of the Trustee and
its counsel, (iv) the qualification of the Securities under securities or Blue
Sky laws in accordance with the provisions of Section 5(d), including filing
fees and the fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of any Blue Sky or
Legal Investment Memoranda, (v) the printing and delivery to the Underwriters in
quantities as hereinabove stated of copies of the Registration Statement and all
amendments thereto and of the Prospectus and any amendments or supplements
thereto, (vi) any fees charged by rating agencies for the rating of the
Securities, (vii) the fees and expenses, if any, incurred with respect to any
filing with the National Association of Securities Dealers, Inc., (viii) the
fees and expenses of listing the Preferred Securities and the Debentures on the
New York Stock Exchange and registering the Preferred Securities and the
Debentures under the Exchange Act and (ix) all document production charges and
expenses of counsel to the Underwriters (but not including their fees for
professional services) in connection with the preparation of this Agreement.
(k) So long as any Preferred Securities are outstanding, the Company
shall be the sole general partner of the Partnership.
6. Indemnification and Contribution. (a) The Partnership and the
--------------------------------
Company agree, severally and jointly, to indemnify and hold harmless each
Underwriter and each person, if any, who controls such Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
by any Underwriter or any such
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controlling person in connection with investigating or defending any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Partnership or the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Underwriter
furnished to the Partnership and the Company in writing by such Underwriter
through the Manager expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Partnership, the Company, each of their respective
directors, each of their respective officers who sign the Registration Statement
and each person, if any, who controls the Partnership or the Company within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act to the same extent as the foregoing indemnity from the Partnership and the
Company to such Underwriter, but only with reference to information relating to
such Underwriter furnished to the Partnership or the Company in writing by such
Underwriter through the Manager expressly for use in the Registration Statement,
any preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) of this Section 6, such person
(the "indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnifying party in
connection with any proceeding or related proceedings in the same jurisdiction,
be
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liable for the fees and expenses of more than one separate firm (in addition to
any local counsel) for all such indemnified parties and that all such fees and
expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by the Manager, in the case of parties indemnified
pursuant to paragraph (a) of this Section 6, and by the Company, in the case of
parties indemnified pursuant to paragraph (b) of this Section 6. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph (c), the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a) or
(b) of this Section 6 is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Partnership and the Company on the one hand and the
Underwriters on the other hand from the offering of the Securities or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Partnership
and the Company on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Partnership and the
Company on the one hand and the Underwriters on the other hand in connection
with the offering of the Securities shall be deemed to be in the same
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respective proportions as the net proceeds from the offering of such Securities
(before deducting expenses) received by the Partnership and the Company and the
total underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover of the Prospectus Supplement,
bear to the aggregate public offering price of the Securities. The relative
fault of the Partnership and the Company on the one hand and of the Underwriters
on the other hand shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Partnership or the Company or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Underwriters' respective
obligations to contribute pursuant to this Section 6 are several in proportion
to the respective principal amounts of Securities they have purchased hereunder,
and not joint.
(e) The Partnership, the Company and the Underwriters agree that it
would not be just or equitable if contribution pursuant to this Section 6 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) of this
Section 6. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in paragraph (d) of this
Section 6 shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The remedies provided for in this
Section 6 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.
7. Termination. This Agreement shall be subject to termination, by
-----------
notice given by the Manager to the Company, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the
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Chicago Board of Trade, (ii) trading of any securities of the Company or any of
its subsidiaries shall have been suspended on any exchange or in any over-the-
counter market, (iii) a general moratorium on commercial banking activities in
New York shall have been declared by either Federal or New York State
authorities or (iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis that,
in the judgment of the Manager, is material and adverse and (b) in the case of
any of the events specified in clauses (a)(i) through (iv), such event, singly
or together with any other such event, makes it, in the judgment of the Manager,
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus.
8. Defaulting Underwriters. If, on the Closing Date any one or more
-----------------------
of the Underwriters shall fail or refuse to purchase Preferred Securities that
it has or they have agreed to purchase hereunder on such date, and the number of
Preferred Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the aggregate
number of the Preferred Securities to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Preferred Securities set forth opposite their respective names above bears to
the aggregate number of Preferred Securities set forth opposite the names of all
such non-defaulting Underwriters, or in such other proportions as the
Underwriters may specify, to purchase the Preferred Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date; provided that in no event shall the number of Preferred Securities
--------
that any Underwriter has agreed to purchase pursuant to this Agreement be
increased pursuant to this Section 8 by an amount in excess of one-ninth of such
number of Preferred Securities without the written consent of such Underwriter.
If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Preferred Securities and the number of Preferred Securities with
respect to which such default occurs is more than one-tenth of the aggregate
number of Preferred Securities to be purchased on such date, and arrangements
satisfactory to the Manager, the Partnership and the Company for the purchase of
such Preferred Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter, the Partnership or the Company. In any such case either the
Manager, the Partnership or the Company shall have the right to postpone the
Closing Date but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus or
in any other documents or arrangements may be effected. Any action taken under
this paragraph shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
-25-
<PAGE>
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Partnership or the
Company to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Partnership and the Company shall be unable
to perform its obligations under this Agreement, the Partnership and the Company
severally and jointly will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering of the Preferred Securities.
9. Representations and Indemnities to Survive. The respective
------------------------------------------
indemnity and contribution agreements and the representations, warranties and
other statements of the Partnership, the Company, their respective officers and
the Underwriters set forth in this Agreement will remain in full force and
effect, regardless of any termination of this Agreement, any investigation made
by or on behalf of any Underwriter, the Partnership or the Company or any of the
officers, directors or controlling persons referred to in Section 6 and delivery
of and payment for the Preferred Securities.
10. Successors. This Agreement will enure to the benefit of and be
----------
binding upon the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in Section 6, and no
other person will have any right or obligation hereunder.
11. Counterparts. This Agreement may be signed in any number of
------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and
--------------
construed in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have
--------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
-26-
<PAGE>
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
MORGAN STANLEY & CO. INCORPORATED
By:
-------------------------------
Name:
Title:
Acting on behalf of itself and the several Underwriters
named herein
Accepted:
UNITED CAPITAL FUNDING PARTNERSHIP L.P.
By: THE UNITED ILLUMINATED COMPANY,
as General Partner
By:
-------------------------------
Name:
Title:
THE UNITED ILLUMINATING COMPANY
By:
-------------------------------
Name:
Title:
-27-
<PAGE>
EXHIBIT 1(b)
[Form of Underwriting Agreement relating to Debentures corresponding to
Preferred Capital Securities]
UNDERWRITING AGREEMENT
[_____]
THE UNITED ILLUMINATING COMPANY
157 Church Street
New Haven, Connecticut 06506
Ladies and Gentlemen:
We (the "Underwriters") understand that The United Illuminating
Company, a Connecticut corporation (the "Company"), proposes to issue and sell
$[_____] aggregate principal amount of its junior subordinated deferrable
interest debentures of a series designated [__]% Junior Subordinated Deferrable
Interest Debentures, Series A, Due [_____] (the "Debentures"). The Debentures
will be issued under an Indenture dated as of [_____] (as supplemented by the
[_____] Supplemental Indenture thereto dated as of [_____], the "Indenture")
between the Company and The Bank of New York, as Trustee (the "Trustee").
1. Representations and Warranties. The Company represents and
-------------------------------
warrants to and agrees with each of the Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (Registration Statement
Nos. 33-[_____]), including a prospectus and prospectus supplement, pursuant to
Rule 415 under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the Debentures and has filed with, or transmitted for filing to, or
shall promptly hereafter file with or transmit for filing to, the Commission a
prospectus supplement (the "Prospectus Supplement") specifying the terms of the
Debentures and the plan of distribution thereof pursuant to Rule 424 under the
Securities Act; and as used herein, (i) the term "Registration Statement" means
the registration statement, including the exhibits thereto, as amended to the
date of this Agreement, (ii) the term "Basic Prospectus" means the prospectus
included in the Registration Statement, (iii) the term
<PAGE>
"Prospectus" means the Basic Prospectus together with the Prospectus Supplement,
(iv) the term "preliminary prospectus" means a preliminary prospectus supplement
specifically relating to the Debentures, together with the Basic Prospectus, and
(v) the terms "Basic Prospectus," "Prospectus" and "preliminary prospectus"
shall include in each case the documents incorporated by reference therein and
the terms "supplement," "amendment" and "amend" shall include the documents, if
any, deemed to be incorporated by reference in the Prospectus that are filed
subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
(b) The Registration Statement has become effective; and no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(c) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) the
Registration Statement, when it became effective, did not contain, and, as
amended or supplemented, if applicable, will not contain, any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (iii) the
Registration Statement and the Prospectus comply, and, as amended or
supplemented, if applicable, will comply, in all material respects with the
Securities Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the respective applicable rules and regulations of the
Commission thereunder and (iv) the Prospectus does not contain, and, as amended
or supplemented, if applicable, will not contain, any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
Section 1(c) do not apply (A) to statements or omissions in the Registration
Statement or the Prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter expressly for use
therein or (B) to that part of the Registration Statement that constitutes the
Statement of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee.
(d) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Connecticut, has due
corporate power and authority to own and operate its property and to conduct its
business as described in the Prospectus, to issue the Debentures, to execute and
deliver, and perform its obligations under, this Agreement, the Indenture and
the Debentures, and to consummate the
-2-
<PAGE>
transactions herein and therein contemplated; and the Company is duly qualified
to transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(e) Each subsidiary of the Company has been duly organized, is validly
existing as a corporation or partnership in good standing under the laws of the
jurisdiction of its organization, has the corporate or partnership power and
authority to own its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(f) This Agreement has been duly authorized, executed and delivered
by the Company.
(g) The Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, and on the Closing Date will be duly executed
and delivered, by the Company and, when so executed and delivered, will be a
valid and binding agreement of the Company, enforceable in accordance with its
terms subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and
equitable principles of general applicability.
(h) The Debentures have been duly authorized, and on the Closing Date
will be duly executed and delivered, by the Company and, when so executed and
delivered and when executed and authenticated in accordance with the provisions
of the Indenture and delivered to and paid for by the Underwriters in accordance
with the terms of this Agreement, will be entitled to the benefits of the
Indenture, will rank pari passu without any preference among themselves and
---- -----
subordinate to all Senior Indebtedness (as defined in the Indenture) and will be
valid and binding obligations of the Company, enforceable in accordance with
their terms subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and
equitable principles of general applicability; and the Indenture and the
Debentures will conform to the descriptions thereof contained in the Prospectus.
(i) The Company and its subsidiaries are not in violation of their
respective certificates of incorporation or bylaws or other organizational
documents, as the case may be, or in default in the performance or observance of
any material
-3-
<PAGE>
obligation, agreement, covenant or condition contained in any contract,
agreement or other instrument under which any of them may be bound, the effect
of which would have a material adverse effect on the Company and its
subsidiaries, taken as a whole; the issuance and sale of the Debentures by the
Company and the execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement, the Indenture and the
Debentures and the consummation of the transactions herein and therein
contemplated will not conflict with, result in a breach of or constitute a
default under any provision of (A) applicable law, (B) the certificate of
incorporation or bylaws of the Company, (C) any agreement or other instrument
binding upon the Company or any of its subsidiaries that is material to the
Company and its subsidiaries, taken as a whole, or (D) any judgment, order or
decree of any governmental body, agency or court having jurisdiction over the
Company or any subsidiary; and, subject to the approval of the Department of
Public Utility Control of the State of Connecticut (the "DPUC"), no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the issuance of the Debentures or the execution
and delivery of, and the performance of its obligations under, this Agreement,
the Indenture or the Debentures, in each case by the Company, or the
consummation of the transactions herein or therein contemplated, except such as
may be required by the securities or Blue Sky laws of the various states in
connection with the issuance of the Debentures.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Prospectus.
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is subject
that are required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes, regulations, contracts or
other documents that are required to be described in the Registration Statement
or the Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement that are not described, filed or incorporated as
required.
(l) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended.
(m) The Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of
-4-
<PAGE>
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) have received
all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are in
compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(n) In the ordinary course of its business, the Company conducts a
periodic review of the effect of Environmental Laws on the business, operations
and properties of the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties); and on the basis of such review, the Company has
reasonably concluded that such associated costs and liabilities would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(o) The Company has complied with all provisions of Section 517.075,
Florida Statutes (Chapter 92-198, Laws of Florida).
2. Public Offering. The Company is advised by the Underwriters that
---------------
the Underwriters propose to make a public offering of their respective portions
of the Debentures as soon after this Agreement has been entered into as in the
judgment of the Underwriters is advisable. The terms of the public offering of
the Debentures are set forth in the Prospectus.
3. Purchase and Delivery. Subject to the terms and conditions set
---------------------
forth or incorporated by reference herein, the Company hereby agrees to sell and
the Underwriters agree to purchase, severally and not jointly, the respective
principal amounts of Debentures set forth below opposite their names at a
purchase price of [__]% of the principal amount thereof (plus accrued interest,
if any, from [_____]):
<TABLE>
<CAPTION>
Principal Amount of
Name Debentures
---- -------------------
<S> <C>
Morgan Stanley & Co.
Incorporated $[ ]
[ ]
----------------
Total . . . . . . . . . . $[ ]
================
</TABLE>
-5-
<PAGE>
The Underwriters will pay for the Debentures upon delivery thereof at
the offices of Winthrop, Stimson, Putnam & Roberts, One Battery Park Plaza, New
York, New York at 10:00 a.m. (New York time) on [_____], 1994, or at such other
time as the Company and the Underwriters shall mutually agree upon. The time
and date of such payment and delivery are hereinafter referred to as the
"Closing Date." Except as otherwise provided in this Section 3, payment for the
Debentures shall be made by certified or official bank check or checks payable
to the order of the Company in New York Clearing House funds at the time and
place set forth in this Agreement, upon delivery to Morgan Stanley & Co.
Incorporated ("Morgan Stanley"), for the respective accounts of the several
Underwriters, of Debentures, registered in such names and in such denominations
as the Underwriters shall request in writing not less than two full business
days prior to the date of delivery, with any transfer taxes payable in
connection with the transfer of the Debentures to the Underwriters duly paid.
4. Conditions to Closing. The several obligations of the
---------------------
Underwriters hereunder are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's securities
(including the Debentures) by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2) under
the Securities Act;
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise,
or in the earnings, business or operations, of the Company and its
subsidiaries, taken as a whole, from that set forth in the Prospectus,
that, in the judgment of Morgan Stanley, is material and adverse and that
makes it, in the judgment of Morgan Stanley, impracticable to market the
Debentures on the terms and in the manner contemplated in the Prospectus;
and
(iii) the Company shall have obtained an appropriate order of
the DPUC authorizing the issuance, sale and delivery of the Debentures as
contemplated by this Agreement, which at the Closing Date shall be in full
force and effect and shall not be contested or the subject of review or
appeal.
(b) The Underwriters shall have received on the Closing Date a
certificate of the Company, dated the Closing Date and signed by an executive
officer of the Company, to the effect
-6-
<PAGE>
set forth in clauses (a)(i) and (iii) above and to the effect that the
representations and warranties of the Company contained in this Agreement are
true and correct as of the Closing Date and that the Company has complied with
all of the agreements and satisfied all of the conditions on its part to be
performed or satisfied on or before the Closing Date. The officer signing and
delivering such certificate may rely upon the best of such officer's knowledge
as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Wiggin & Dana, counsel for the Company, dated the Closing Date, to
the effect that:
(i) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Connecticut, has the corporate power and authority to own and operate its
property and to conduct its business as described in the Prospectus and to
issue the Debentures, to execute and deliver, and perform its obligations
under, this Agreement, the Indenture and the Debentures and to consummate
the transactions herein and therein contemplated; and the Company is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole;
(ii) each subsidiary of the Company has been duly organized, is
validly existing as a corporation or partnership in good standing under the
laws of the jurisdiction of its organization, has the corporate or
partnership power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole;
(iii) this Agreement has been duly authorized, executed and delivered
by the Company;
(iv) the Indenture has been duly qualified under the Trust Indenture
Act and has been duly authorized, executed and delivered by the Company and
is a valid and binding agreement of the Company enforceable in accordance
with its terms subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization or similar laws
-7-
<PAGE>
affecting creditors' rights generally and equitable principles of general
applicability;
(v) the Debentures have been duly authorized and, when executed
and authenticated in accordance with the provisions of the Indenture and
delivered to and duly paid for by the Underwriters in accordance with the
terms of this Agreement, will be entitled to the benefits of the Indenture,
will rank pari passu without any preference among themselves and
---- -----
subordinate to all Senior Indebtedness and will be valid and binding
obligations of the Company enforceable in accordance with their terms
subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally and
equitable principles of general applicability;
(vi) the Company and its subsidiaries are not in violation of
their respective certificates of incorporation or bylaws or other
organizational documents, as the case may be, or in default in the
performance or observance of any material obligation, agreement, covenant
or condition contained in any contract, agreement or other instrument by
which any of them may be bound, the effect of which would have a material
adverse effect on the Company and its subsidiaries, taken as a whole; the
issuance and sale of the Debentures by the Company and the execution and
delivery by the Company of, and the performance by the Company of its
obligations under, this Agreement, the Indenture and the Debentures and the
consummation of the transactions herein and therein contemplated will not
conflict with, result in a breach of or constitute a default under any
provision of (A) applicable law, (B) the certificate of incorporation or
bylaws of the Company, (C) to the best of such counsel's knowledge, after
due inquiry, any agreement or other instrument binding upon the Company or
any of its subsidiaries that is material to the Company and its
subsidiaries, taken as a whole, or (D) to the best of such counsel's
knowledge, after due inquiry, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or
any of its subsidiaries; the Company has obtained an appropriate order of
the DPUC authorizing the issuance, sale and delivery of the Debentures as
contemplated by this Agreement, which order is in full force and effect,
has not been contested and is not the subject of review or appeal; and no
other consent, approval, authorization or order of, or qualification with,
any governmental body or agency is required for the issuance of the
Debentures, the execution and delivery of, and the performance of its
obligations under, this Agreement, the Indenture or the Debentures, in each
case by the Company, or the consummation of the transactions herein or
therein contemplated, except such as may be required by the securities or
Blue Sky laws of the various states in connection with the issuance of the
Debentures;
-8-
<PAGE>
(vii) (A) the Registration Statement meets the requirements set
forth in Rule 415(a)(1)(ix) or (x) under the Securities Act and complies in
all material respects with said Rule; (B) the Registration Statement has
become effective and no stop order suspending the effectiveness of the
Registration Statement is in effect, nor are proceedings for such purpose
pending before or, to the best of such counsel's knowledge, threatened by
the Commission; (C) the Prospectus has been transmitted in a manner
reasonably calculated to result in filing with the Commission in accordance
with Rule 424(b) of the Securities Act; and (D) the statements (1) in the
Prospectus Supplement under the captions "Certain Terms of the Series A
Debentures" and "Underwriting," (2) in the Basic Prospectus under the
captions "Description of the Debentures and the Indenture" and "Plan of
Distribution," (3) in the Registration Statement under Item 15, (4) in
"Item 3 - Legal Proceedings" of the Company's most recent annual report on
Form 10-K incorporated by reference in the Prospectus and (5) in "Item 1 -
Legal Proceedings" of Part II of the Company's quarterly reports on Form
10-Q filed since such annual report, in each case insofar as such
statements constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present the information called for
with respect to such legal matters, documents and proceedings and fairly
summarize the matters referred to therein;
(viii) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which the
Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the Prospectus
and are not so described or of any statutes, regulations, contracts or
other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed or incorporated by reference as
exhibits to the Registration Statement that are not described, filed or
incorporated as required;
(ix) the Company is not an "investment company" or an entity
"controlled" by an "investment company," as those terms are defined in the
Investment Company Act; and
(x) such counsel (A) is of the opinion that each document filed
pursuant to the Exchange Act and incorporated by reference in the
Prospectus (except for financial statements and schedules included therein
as to which such counsel need not express any opinion) complied when so
filed as to form in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (B) believes
that (except for financial statements and schedules as to which such
counsel need not express any belief and except for that part of the
-9-
<PAGE>
Registration Statement that constitutes the Statement of Eligibility (Form
T-1) under the Trust Indenture Act of the Trustee) the Registration
Statement, when it became effective did not, and, as of the date such
opinion is delivered, does not, contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (C) is of the
opinion that the Registration Statement and the Prospectus (except for
financial statements and schedules included therein as to which such
counsel need not express any opinion) comply as to form in all material
respects with the Securities Act and the Trust Indenture Act and the
applicable rules and regulations of the Commission thereunder and (D)
believes that (except for financial statements and schedules as to which
such counsel need not express any belief) the Prospectus as of the date
such opinion is delivered does not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
In rendering such opinion, Wiggin & Dana may rely (A) as to matters of
fact, to the extent deemed proper, on certificates of responsible officers of
the Company and the Company's subsidiaries and public officials and (B) as to
matters involving the application of the laws of the State of New York, upon the
opinion of Winthrop, Stimson, Putnam & Roberts rendered pursuant to Section
4(e). With respect to paragraph (x) of this Section 4(c), Wiggin & Dana may
state that their opinion and belief are based upon their participation in the
preparation of the Registration Statement and the Prospectus and any amendments
or supplements thereto and documents incorporated therein by reference and
review and discussion of the contents thereof, but are without independent check
or verification, except as specified. The opinion of Wiggin & Dana described in
this Section 4(c) shall be rendered to the Underwriters at the request of the
Company and shall so state therein.
(d) The Underwriters shall have received on the Closing Date an
opinion of Reid & Priest, special tax counsel for the Company, dated the Closing
Date, in form and substance satisfactory to the Underwriters, confirming its
opinion set forth in the Prospectus Supplement under the caption "United States
Income Taxation." The opinion of Reid & Priest described in this Section 4(d)
shall be rendered to the Underwriters at the request of the Company and shall so
state therein.
(e) The Underwriters shall have received on the Closing Date an
opinion of Winthrop, Stimson, Putnam & Roberts, special counsel for the
Underwriters, dated the Closing Date, covering such matters as the Underwriters
shall reasonably request and the Company shall have furnished to such counsel
such documents as they request for the purpose of enabling them to
-10-
<PAGE>
pass upon such matters. In rendering such opinion, Winthrop, Stimson, Putnam &
Roberts may rely (i) as to matters of fact, to the extent deemed proper, on
certificates of responsible officers of the Company and the Company's
subsidiaries and public officials and (ii) as to matters involving the
application of the laws of the State of Connecticut, upon the opinion of Wiggin
& Dana rendered pursuant to Section 4(c).
(f) The Underwriters shall have received on the date of this Agreement
a letter, dated the date of this Agreement, in form and substance satisfactory
to the Underwriters, from Coopers & Lybrand, the Company's independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference into the Prospectus.
(g) The Underwriters shall have received on the Closing Date a letter,
dated the Closing Date, in form and substance satisfactory to the Underwriters,
from Coopers & Lybrand, the Company's public accountants, to the effect that
such accountants reaffirm, as of the Closing Date, and as though made on the
Closing Date, the statements made in the letter furnished by such accountants
pursuant to Section 4(f), except that the specified date referred to therein
shall be a date not more than five business days prior to the Closing Date.
(h) Moody's Investors Service, Inc. and Standard & Poor's Ratings
Group shall have publicly assigned to the Debentures ratings of [__] and [__],
respectively, which ratings shall be in full force and effect on the Closing
Date.
5. Covenants of the Company. In further consideration of the
------------------------
agreements of the Underwriters herein contained, the Company covenants as
follows:
(a) To furnish the Underwriters, without charge, a signed copy of the
Registration Statement (including exhibits thereto) and, during the period
mentioned in Section 5(c), as many copies of the Prospectus, any documents
incorporated by reference therein and any supplements and amendments thereto or
to the Registration Statement as the Underwriters may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to the Underwriters a copy of each such proposed
amendment or supplement for their review a reasonable amount of time prior to
the filing thereof.
(c) If, during such period after the first date of the public offering
of the Debentures as in the opinion of counsel for the Underwriters a prospectus
relating to the Debentures is required by law to be delivered in connection with
sales by an
-11-
<PAGE>
Underwriter or dealer, any event shall occur or condition exist as a result of
which it is necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if, in the opinion of counsel for
the Underwriters, it is necessary to amend or supplement the Prospectus to
comply with law, forthwith to prepare, file with the Commission and furnish, at
its own expense, to the Underwriters, and to the dealers (whose names and
addresses the Underwriters will furnish to the Company) to which Debentures may
have been sold by the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the statements in the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be misleading or
so that the Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Debentures for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Underwriters shall
reasonably request and to maintain such qualification for as long as the
Underwriters shall reasonably request.
(e) To make generally available to its security holders and to the
Underwriters as soon as practicable an earning statement covering a twelve month
period beginning on the first day of the first full fiscal quarter after the
date of this Agreement, which earning statement shall satisfy the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder. If such twelve month period is coterminous with the
Company's fiscal year, such earnings statement shall be made available not later
than 90 days after the close of the period covered thereby and in all other
cases shall be made available not later than 45 days after the close of the
period covered thereby.
(f) During the period beginning on the date of this Agreement and
continuing to and including the date that is 90 days after the Closing Date, not
to offer, sell, contract to sell or otherwise dispose of any securities of the
Company or any of its subsidiaries that are substantially similar to the
Debentures, any preferred stock or subordinated debentures of the Company or any
of its subsidiaries or any other securities convertible into or exchangeable for
Debentures, any securities substantially similar to the Debentures or warrants
to purchase any of such securities, without the prior written consent of the
Underwriters.
(g) If, in the judgment of the Underwriters, it shall be necessary or
advisable to list the Debentures on the New York Stock Exchange, to take, or
cause to be taken, all actions necessary or advisable to effect such listing and
the admission for trading of the Debentures on such Exchange and the
registration thereof under the Exchange Act.
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<PAGE>
(h) Whether or not any sale of Debentures is consummated, to pay all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the preparation and filing of the Registration Statement and the
Prospectus and all amendments and supplements thereto, (ii) the preparation,
issuance and delivery of the Debentures, (iii) the fees and disbursements of the
Company's counsel and accountants and of the Trustee and its counsel, (iv) the
qualification of the Debentures under securities or Blue Sky laws in accordance
with the provisions of Section 5(d), including filing fees and the fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of any Blue Sky or Legal Investment Memoranda,
(v) the printing and delivery to the Underwriters in quantities as hereinabove
stated of copies of the Registration Statement and all amendments thereto and of
the Prospectus and any amendments or supplements thereto, (vi) any fees charged
by rating agencies for the rating of the Debentures, (vii) the fees and
expenses, if any, incurred with respect to any filing with the National
Association of Securities Dealers, Inc., (viii) the fees and expenses, if any,
of listing the Debentures on the New York Stock Exchange and registering the
Debentures under the Exchange Act and (ix) all document production charges and
expenses of counsel to the Underwriters (but not including their fees for
professional services) in connection with the preparation of this Agreement.
6. Indemnification and Contribution. (a) The Company agrees to
--------------------------------
indemnify and hold harmless each Underwriter and each person, if any, who
controls such Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred by any Underwriter or any such
controlling person in connection with investigating or defending any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information relating to any Underwriter furnished to the Company in writing
by such Underwriter expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from
-13-
<PAGE>
the Company to such Underwriter, but only with reference to information relating
to such Underwriter furnished to the Company in writing by such Underwriter
expressly for use in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) of this Section 6, such person
(the "indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnifying party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by the Underwriters, in the case of parties indemnified
pursuant to paragraph (a) of this Section 6, and by the Company, in the case of
parties indemnified pursuant to paragraph (b) of this Section 6. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph (c), the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party
-14-
<PAGE>
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a) or
(b) of this Section 6 is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Debentures or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and of the Underwriters on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other hand
in connection with the offering of the Debentures shall be deemed to be in the
same respective proportions as the net proceeds from the offering of such
Debentures (before deducting expenses) received by the Company and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Prospectus Supplement, bear
to the aggregate public offering price of the Debentures. The relative fault of
the Company on the one hand and of the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Underwriters' respective obligations to contribute pursuant to this Section 6
are several in proportion to the respective principal amounts of Debentures they
have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 6 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) of this
-15-
<PAGE>
Section 6. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in paragraph (d) of this
Section 6 shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Debentures underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The remedies provided for in this
Section 6 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.
7. Termination. This Agreement shall be subject to termination, by
-----------
notice given by Morgan Stanley to the Company, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Company or any of its subsidiaries shall have been
suspended on any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities or (iv) there shall have
occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis that, in the judgment of Morgan Stanley, is
material and adverse and (b) in the case of any of the events specified in
clauses (a)(i) through (iv), such event, singly or together with any other such
event, makes it, in the judgment of Morgan Stanley & Co., impracticable to
market the Debentures on the terms and in the manner contemplated in the
Prospectus.
8. Defaulting Underwriters. If, on the Closing Date any one or more
-----------------------
of the Underwriters shall fail or refuse to purchase Debentures that it has or
they have agreed to purchase hereunder on such date, and the aggregate principal
amount of Debentures which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the aggregate
principal amount of the Debentures to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the aggregate
principal amount of Debentures set forth opposite their respective names above
bears to the aggregate principal amount of Debentures set forth
-16-
<PAGE>
opposite the names of all such non-defaulting Underwriters, or in such other
proportions as the Underwriters may specify, to purchase the Debentures which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date; provided that in no event shall the aggregate principal
--------
amount of Debentures that any Underwriter has agreed to purchase pursuant to
this Agreement be increased pursuant to this Section 8 by an amount in excess of
one-ninth of such aggregate principal amount of Debentures without the written
consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Debentures and the aggregate
principal amount of Debentures with respect to which such default occurs is more
than one-tenth of the aggregate principal amount of Debentures to be purchased
on such date, and arrangements satisfactory to the Underwriters and the Company
for the purchase of such Debentures are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either the
Underwriters or the Company shall have the right to postpone the Closing Date
but in no event for longer than seven days, in order that the required changes,
if any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering of the Debentures.
9. Representations and Indemnities to Survive. The respective
------------------------------------------
indemnity and contribution agreements and the representations, warranties and
other statements of the Company, its officers and the Underwriters set forth in
this Agreement will remain in full force and effect, regardless of any
termination of this Agreement, any investigation made by or on behalf of any
Underwriter or the Company or any of the officers, directors or controlling
persons referred to in Section 6 and delivery of and payment for the Debentures.
10. Successors. This Agreement will enure to the benefit of and be
----------
binding upon the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in Section 6, and no
other person will have any right or obligation hereunder.
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<PAGE>
11. Counterparts. This Agreement may be signed in any number of
------------
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
12. Applicable Law. This Agreement shall be governed by and
--------------
construed in accordance with the internal laws of the State of New York.
13. Headings. The headings of the sections of this Agreement have
--------
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
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<PAGE>
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
MORGAN STANLEY & CO. INCORPORATED
By: _______________________________
Name:
Title:
Acting on behalf of itself and the
several Underwriters named herein
Accepted:
THE UNITED ILLUMINATING COMPANY
By: _______________________________
Name:
Title:
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<PAGE>
CERTIFICATE OF LIMITED PARTNERSHIP
OF
UNITED CAPITAL FUNDING PARTNERSHIP L.P.
The undersigned hereby represents that it has formed a limited partnership
pursuant to the Delaware Revised Uniform Limited Partnership Act ("Act") and
that the undersigned has executed this Certificate in compliance with the
requirements of the Act. The undersigned further states:
1. The name of the limited partnership is United Capital Funding
Partnership L.P. ("Partnership").
2. The address of the registered office of the Partnership in the State
of Delaware and the name and address of the registered agent of the Partnership
required to be maintained by Section 17-104 of the Act at such address are as
follows:
REGISTERED AGENT REGISTERED OFFICE
---------------- -----------------
The Corporation Trust Company Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
3. The name and business address of the sole General Partner are as
follows:
GENERAL PARTNER ADDRESS
--------------- -------
The United Illuminating 157 Church Street
Company New Haven, CT 06506
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
August 17, 1994.
THE UNITED ILLUMINATING COMPANY
By /s/ Robert L. Fiscus
-------------------------------------
Robert L. Fiscus
President
<PAGE>
AGREEMENT OF LIMITED PARTNERSHIP
OF UNITED CAPITAL FUNDING PARTNERSHIP L.P.
This AGREEMENT OF LIMITED PARTNERSHIP OF UNITED CAPITAL FUNDING PARTNERSHIP
L.P. dated as of August 18, 1994 (the "Agreement") is entered into by and among
The United Illuminating Company, a Connecticut corporation ("United
Illuminating"), as the general partner, and United Resources, Inc. (the "Limited
Partner" and collectively with the United Illuminating the "Partners").
WHEREAS, United Illuminating and the Limited Partner desire to form a
limited partnership pursuant to (S) 17-201 of the Delaware Revised Uniform
Limited Partnership Act, 6 Del. C. (S) 17-101, et seq., as amended from time to
--- - ------
time (the "Act"), by filing a certificate of limited partnership with the office
of the Secretary of State of the State of Delaware, and entering into the
Agreement;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby desire
to be governed by the Act and agree as follows:
1. The partnership shall commence on August 18, 1994 and shall continue
until December 31, 204[4/5] unless sooner dissolved before such date in
accordance with the provisions of this Agreement or upon the unanimous written
consent of the partners.
2. United Illuminating shall be the general partner and United Resources,
Inc. shall be the limited partner.
3. The firm name under which the business of the partnership shall be
conducted shall be United Capital Funding Partnership L.P.
4. The sole purpose of the partnership is to issue limited partnership
interests and to loan the proceeds thereof to United Illuminating in return for
debentures of United Illuminating, and to engage in any and all activities
necessary, advisable or incidental thereto.
5. The parties shall execute a certificate and cause the certificate to be
recorded and do all other things requisite for the formation of a limited
partnership in conformity with the statutes of the state of Delaware.
6. The business shall be carried on at c/o The United Illuminating
Company, 157 Church Street, New Haven, Connecticut 06510.
7. The limited partner shall not take part in the management of the
business or transact any business for the partnership and shall have no power to
sign for or to bind the firm.
<PAGE>
8. The capital of the partnership shall be ten dollars. United
Illuminating as general partner shall contribute one dollars. United Resources
as limited partner shall contribute in actual cash nine dollars.
9. At all times during the continuance of the partnership, the partnership
shall maintain proper books of account for the partnership that shall show a
true and accurate record of all costs and expenses incurred and all income
derived in connection with the operation of the partnership's business in
accordance with generally accepted accounting principles consistently applied.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above stated.
GENERAL PARTNER:
THE UNITED ILLUMINATING COMPANY
By /s/ Richard J. Grossi
--------------------------------
Name: Richard J. Grossi
Title: Chief Executive Officer
INITIAL LIMITED PARTNER:
UNITED RESOURCES, INC.
By /s/ E. Jon Majowski
--------------------------------
Name: E. Jon Majowski
Title: President
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<PAGE>
EXHIBIT 4(c)
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
OF UNITED CAPITAL FUNDING PARTNERSHIP L.P.
This AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP OF UNITED
CAPITAL FUNDING PARTNERSHIP L.P. dated _______________ ____, 1994 (the
"Agreement") is entered into by and among The United Illuminating Company, a
Connecticut corporation ("United Illuminating"), as the General Partner, and
UNITED RESOURCES, INC., a Connecticut corporation (the "Initial Limited
Partner"), together with the other Persons who become Limited Partners of the
Partnership as provided herein.
WHEREAS, United Illuminating and the Initial Limited Partner have
formed a limited partnership pursuant to and in accordance with Delaware Revised
Uniform Limited Partnership Act, 6 Del. C. (S) 17-101, et seq., as amended from
--- - ------
time to time (the "Act"), by filing a Certificate of Limited Partnership with
the office of the Secretary of State of the State of Delaware on August 18,
1994;
WHEREAS, United Illuminating and the Initial Limited Partner entered
into a Limited Partnership Agreement dated as of August 18, 1994 (the "Original
Limited Partnership Agreement"); and
WHEREAS, United Illuminating and the Initial Limited Partner desire to
continue the Partnership as a limited partnership under the Act and to amend and
restate the Original Limited Partnership Agreement in its entirety.
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINED TERMS
Unless the context otherwise requires, the terms defined in this
Article I shall, for the purposes of this Agreement, have the meanings herein
specified.
"Act" shall mean the Delaware Revised Uniform Limited Partnership Act,
6 Del. C. (S) 17-101, et seq., as the same may be amended from time to time, and
--- -------
any successor to such Act.
"Action" shall have the meaning set forth in Section 10.2(a).
"Additional Amounts" shall have the meaning set forth in Section 10.2
(a)(xii).
"Affiliate" shall mean, with respect to a specified Person, any Person
that directly or indirectly controls, is controlled by, or is under common
control with, the specified Person.
<PAGE>
For purposes of this definition, the term "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.
"Agreement" shall mean this Amended and Restated Agreement of Limited
Partnership of the Partnership, as amended, supplemented or restated and in
effect from time to time including any Action or Actions taken by the General
Partner pursuant to the provisions of Section 10.2.
"Bankruptcy" shall mean any events specified in (S)(S) 17-402(a)(4)
and (5) of the Act.
"Book-Entry Interest" shall mean a beneficial interest in an LP
Certificate, ownership and transfers of which shall be made through book entries
by the Depository as described in Section 14.4.
"Capital Account" shall have the meaning set forth in Section 4.3.
"Certificate" shall mean the Certificate of Limited Partnership and
any and all amendments thereto and restatements thereof filed on behalf of the
Partnership with the office of the Secretary of State of the State of Delaware
pursuant to the Act.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any corresponding federal tax statute enacted after the date of
this Agreement. A reference to a specific section ((S)) of the Code refers not
only to such specific section but also to any corresponding provision of any
federal tax statute enacted after the date of this Agreement, as such specific
section or corresponding provision is in effect on the date of application of
the provisions of this Agreement containing such reference.
"Covered Person" shall mean the General Partner, any Affiliate of the
General Partner or any officers, directors, shareholders, partners, employees,
representatives or agents of the General Partner or their respective Affiliates,
or any employee or agent of the Partnership or its Affiliates or any Special
Representative.
"Debentures" shall mean the junior subordinated deferrable interest
debentures of United Illuminating issued in one or more series under the
Indenture and having certain payment terms that correspond to the terms of the
related series of Preferred Securities.
"Definitive LP Certificates" shall have the meaning set forth in
Section 14.4.
"Depository" shall mean The Depository Trust Company, New York, New
York, or its successors and assigns and any other securities depository for the
Preferred Securities in accordance with this Agreement.
"Dividends" shall mean the distributions (including any interest on
dividends in arrears) paid or payable to any Limited Partner who is a Preferred
Security Holder pursuant to the terms of the Preferred Securities held by such
Limited Partner.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and any successor to such statute.
-2-
<PAGE>
"Fiscal Year" shall mean (i) the period commencing upon the formation
of the Partnership and ending on December 31, 1994 or (ii) any subsequent twelve
(12) month period commencing on January 1 and ending on December 31.
"General Partner" shall mean United Illuminating, in its capacity as
general partner of the Partnership, together with any successor thereto that
becomes a general partner of the Partnership pursuant to the terms of this
Agreement.
"General Partner Interests" shall mean the Interests of the General
Partner in the Partnership.
"Guarantee" shall mean the Payment and Guarantee Agreement of United
Illuminating dated as of _______________, 1994 relating to the Preferred
Securities.
"Guarantor" shall mean United Illuminating.
"Holder" or "Preferred Security Holder" means a Person in whose name
an LP Certificate is registered on the books and records of the Partnership;
provided, however, that in determining whether the Holders of the requisite
percentage of Preferred Securities have given any request, notice, consent or
waiver hereunder, "Holder" shall not include United Illuminating or any
Affiliate of United Illuminating.
"Indemnified Person" shall mean each Limited Partner, any Special
Representative, any Affiliate of the General Partner or any Special
Representative or any officers, directors, shareholders, partners, employees,
representatives or agents of the General Partner or any Special Representative
or of any Affiliate of the General Partner or any Special Representative, or any
employee or agent of the Partnership or its Affiliates.
"Indenture" shall mean the Indenture of United Illuminating dated as
of _______________,1994 between United Illuminating and The Bank of New York, as
trustee, pursuant to which Debentures may be issued, as such Indenture may be
amended and supplemented from time to time.
"Initial Limited Partner" shall mean United Resources, Inc., a
Connecticut corporation.
"Interest" shall mean the entire interest of a Partner in the
Partnership at any particular time, including the right of such Partner to any
and all benefits to which a Partner may be entitled as provided in this
Agreement, together with the obligations of such Partner to comply with all of
the terms and provisions of this Agreement.
"Limited Partners" shall mean any Person who is admitted to the
Partnership as a limited partner of the Partnership in accordance with the terms
of this Agreement, including the Preferred Security Holders, together with any
successors thereto, in each such Person's capacity as a limited partner of the
Partnership.
"Liquidation Distribution" shall mean the liquidation preference of
each series of Preferred Securities as set forth in the Action for such series.
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<PAGE>
"LP Certificate" shall mean a certificate substantially in the form
attached hereto as Exhibit 4(c)(A), evidencing the Preferred Securities held by
a Limited Partner.
"Partners" shall mean the General Partner and the Limited Partners,
collectively, and a "Partner" shall mean any one of the Partners.
"Partnership" shall mean the limited partnership heretofore formed and
continued pursuant to this Agreement under the name "United Capital Funding
Partnership LP", and any successor thereto.
"Person" shall mean any individual, corporation, association,
partnership (general or limited), joint venture, trust, estate, limited
liability company, or other legal entity or organization.
"Preferred Securities" shall have the meaning set forth in Section
10.2 of this Agreement.
"Preferred Security Owner" shall mean, with respect to a Book-Entry
Interest, a Person who is the beneficial owner of such Book-Entry Interest, as
reflected on the books of the Depository, or on the books of a Person
maintaining an account with such Depository (directly as a participant or as an
indirect participant in the Depository, in each case in accordance with the
rules of such Depository).
"Purchase Price" shall mean the amount paid for each Preferred
Security by a Holder of such Preferred Security in the initial offering thereof.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and any successor to such statute.
"Special Representative" means any special representative duly
appointed by the Holders of any series of Preferred Securities in accordance
with the Partnership Agreement or Action or Actions of the General Partner
establishing such series to act on their behalf or on behalf of the Partnership
to enforce the obligations of the Company under the Indenture.
"Tax Matters Partner" means the General Partner designated as such
in Section 12.1 hereof.
"Treasury Regulations" means the income tax regulations, including
temporary regulations, promulgated under the Code, as such regulations may be
amended from time to time (including corresponding provisions of succeeding
regulations).
"Underwriting Agreement" means an Underwriting Agreement among the
Partnership, United Illuminating and the underwriters named therein relating to
the issuance and sale of one or more series of Preferred Securities.
"United Illuminating" means The United Illuminating Company, a
Connecticut corporation, and any successor thereto permitted under the
Indenture.
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ARTICLE II
CONTINUATION AND TERM
Section 2.1 Formation. The General Partner and the Initial Limited
---------
Partner have previously formed the Partnership as a limited partnership pursuant
to the provisions of the Act and hereby amend and restate the Original Limited
Partnership Agreement in its entirety.
Section 2.2 Continuation.
------------
(a) The Partners hereby agree to continue the Partnership under and
pursuant to the provisions of the Act and agree that the rights, duties and
liabilities of the Partners shall be as provided in the Act, except as otherwise
provided herein. The Partnership shall be a limited partnership among the
partners solely for the purpose specified in Section 3.1 and this Agreement
shall not be deemed to create a partnership among the Partners with respect to
any activities whatsoever other than the activities within the scope of the
business purposes of the Partners as specified in Section 3.1. No Partner shall
have any power to bind any other Partner with respect to any matter except as
specifically provided in this Agreement. No Partner shall be responsible or
liable for any indebtedness or obligation of any other Partner incurred before
or after execution of this Agreement.
(b) Upon the execution of this Agreement or a counterpart of this
Agreement, United Illuminating shall continue as the General Partner and United
Resources, Inc. shall continue as the Initial Limited Partner. Pursuant to
Section 2.2(c) of this agreement, the Holders from time to time shall be
admitted to the Partnership as Limited Partners. Following the admission of any
Holder to the Partnership as a Limited Partner, the Initial Limited Partner
shall withdraw from the Partnership and shall receive the return of its capital
contribution without interest or deduction, and the remaining Partners hereby
agree to continue the business of the Partnership without dissolution.
(c) Without execution of this Agreement, upon receipt by a Person of
an LP Certificate and payment for the Preferred Security being acquired by such
Person, which shall be deemed to constitute a request by such Person that the
books and records of the Partnership reflect its admission as a Limited Partner,
such Person shall be admitted to the Partnership as a Limited Partner and shall
become bound by this Agreement.
(d) The name and mailing address of each Partner and the amount
contributed by such Partner to the capital of the Partnership shall be listed on
the books and records of the Partnership. The General Partner shall be required
to update the books and records from time to time as necessary to accurately
reflect the information therein.
(e) The General Partner shall execute, deliver and file any and all
amendments to and restatements of the Certificate.
Section 2.3 Name. The name of the Partnership heretofore formed and
----
continued hereby is United Capital L.P., unless and until the name of the
Partnership is changed by the General Partner, in its sole discretion, and an
appropriate amendment to the Certificate is filed as required by the Act.
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Section 2.4 Duration. The Partnership commenced on the date the
---------
Certificate was filed in the office of the Secretary of State of the State of
Delaware and shall continue until December 31, 204[4/6] unless sooner dissolved
before such date in accordance with the provisions of this Agreement.
Section 2.5 Registered Agent and Office. The Partnership's registered
---------------------------
agent and office in the State of Delaware is The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County,
Delaware 19801. At any time, the General Partner may designate another
registered agent and/or registered office.
Section 2.6 Principal Place of Business. The principal place of
---------------------------
business of the Partnership shall be c/o The United Illuminating Company, 157
Church Street, New Haven, Connecticut 06510. The General Partner may change the
location of the Partnership's principal place of business, in its sole and
absolute discretion, to be the same as the location of the General Partner's
principal place of business.
Section 2.7 Statutory Compliance. The General Partner shall execute
--------------------
and file on behalf and at the expense of the Partnership all appropriate
certificates required by law to be filed in connection with the formation and
existence of the Partnership, and the General Partner shall execute and so file
such other documents, applications and instruments as it may be deemed necessary
or appropriate with respect to the formation of and the conduct of business by
the Partnership, including, without limitation, the conduct of business, if any,
of the Partnership in Connecticut.
ARTICLE III
PURPOSE AND POWERS OF THE PARTNERSHIP
Section 3.1 Purpose. The sole purpose of the Partnership is to issue
-------
interests in the Partnership, including, without limitation, General Partner
Interests and Preferred Securities, and to loan the proceeds thereof to United
Illuminating in return for Debentures of United Illuminating, and to engage in
any and all activities necessary, advisable or incidental thereto.
Section 3.2 Powers of the Partnership.
-------------------------
(a) The Partnership shall have the power and authority to take any and
all actions necessary, appropriate, proper, advisable, incidental or convenient
to or for the furtherance of the purpose set forth in Section 3.1., including
all of the powers that may be exercised by the General Partner on behalf of the
Partnership pursuant to this Agreement.
(b) The Partnership, and the General Partner on behalf of the
Partnership, may enter into and execute, deliver, acknowledge and perform one or
more Underwriting Agreements, registration statements, applications and filings
to list Preferred Securities on one or more national securities exchanges or
qualify the Preferred Securities for sale in various jurisdictions, and any
other contracts, applications, certificates or agreements contemplated thereby
or specifically described therein, and make loans to United Illuminating in
return for Debentures of United Illuminating, all without any further act, vote
or approval of any Limited Partner notwithstanding any other provision of this
Agreement, the Act or other applicable law. The General Partner is hereby
authorized to enter into and perform on
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behalf of the Partnership all such contracts, applications, filings,
certificates and agreements, but such authorization shall not be deemed a
restriction on the power of the General Partner to enter into other documents on
behalf of the Partnership to the extent specifically provided for in this
Agreement.
Section 3.3 Limitations on Partnership Powers. Notwithstanding the
---------------------------------
foregoing provisions of Section 3.2, neither the Partnership nor the General
Partner on behalf of the Partnership shall have the power or authority (a) to
borrow money or to become liable for the borrowings of any third party or (b)
except as expressly provided in Section 3.1, to engage in any financial or other
trade or business. The Partnership shall not do business in any jurisdiction
other than Delaware or Connecticut.
ARTICLE IV
CAPITAL CONTRIBUTIONS, SECURITIES
AND CAPITAL ACCOUNTS
Section 4.1 Capital Contributions.
---------------------
(a) The General Partner has, on or prior to the date hereof,
contributed an aggregate of $_______________ to the capital of the Partnership,
which amount is equal to at least one percent (1%) of the total capital
contributions to the Partnership on the date hereof, after taking into account
the contributions of the Initial Limited Partner and the Limited Partners
referred to in subsections (b) and (c) of this Section 4.1. The General Partner
shall from time to time make such additional capital contributions as are
necessary to maintain its Capital Account balance at least equal to one percent
(1%) of the aggregate positive Capital Account balances of all the Partners.
(b) The Initial Limited Partner has contributed the amount of $1 to
the capital of the Partnership, which amount shall be returned to the Initial
Limited Partner upon its withdrawal from the Partnership.
(c) Each Limited Partner who acquires a Preferred Security after the
date of this Agreement shall, in connection with the acquisition of such
Preferred Security, contribute to the capital of the Partnership the amount of
the Purchase Price for such Preferred Security. No Limited Partner shall be
required to make any additional capital contribution to the Partnership in
respect of the Preferred Securities held by it.
(d) No Partner shall be entitled to interest on or with respect to
any capital contributions to the Partnership.
(e) No Partner shall be entitled to withdraw any part of such
Partner's capital contribution to the Partnership or to receive any
distributions from the Partnership, except as provided herein.
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Section 4.2 Securities.
----------
(a) The Preferred Securities held by a Preferred Security Holder shall
be registered in its name on the books and records of the Partnership. A
Preferred Security Holder's Interests shall be represented by the Preferred
Securities so registered in its name. Each Limited Partner hereby agrees that
its Interests and any Preferred Securities held by it shall for all purposes be
personal property. No Limited Partner shall have any interest in specific
Partnership property.
(b) The General Partner Interests shall be set forth on the books and
records of the Partnership. The General Partner hereby agrees that the General
Partner Interests shall for all purposes be personal property. The General
Partner shall have no interest in specific Partnership property.
(c) The Partnership shall not issue any additional interests in the
Partnership after the date hereof other than General Partner Interests and
Preferred Securities.
Section 4.3 Capital Accounts.
----------------
(a) There shall be established on the books of the Partnership a
separate capital account ("Capital Account") for each Partner that shall consist
of the initial capital contribution to the Partnership made by such Partner (or
such Partner's predecessor in interest), increased by: (i) any additional
capital contributions made by such Partner including payments made by the
General Partner on behalf of the Partnership as provided in Section 6.2; (ii)
the agreed value of any property subsequently contributed to the capital of the
Partnership by such Partner; and (iii) items of income and gain allocated to
such Partner (a predecessor thereof). A Partner's Capital Account shall be
decreased by: (i) items of loss and deduction allocated to such Partner (or a
predecessor thereof); and (ii) any distributions made to such Partner. In
addition to and notwithstanding the foregoing, Capital Accounts shall be
maintained at all times in accordance with the Capital Account maintenance rules
set forth in Treasury Regulation (S) 1.70401(b)(2)(iv).
(b) The foregoing provisions and the other provisions of this
Agreement relating to the maintenance of Capital Accounts are intended to comply
with Code (S) 704(b) and Treasury Regulation (S) 1.704-1(b) and shall be
interpreted and applied in a manner consistent with such regulations. In the
event that the General Partner shall determine that it is prudent to modify the
manner in which the Capital Accounts, or any debits or credits thereto, are
determined in order to comply with such regulations, the General Partner may
make such modification.
ARTICLE V
PARTNERS
Section 5.1 Powers of Partners. The Partners shall have the power to
------------------
exercise any and all rights or powers granted to the Partners pursuant to the
express terms of this Agreement.
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Section 5.2 Partition. Each Partner waives any and all rights that it
---------
may have to maintain an action for partition of the Partnership's property.
Section 5.3 Withdrawal. A Partner (other than the Initial Limited
----------
Partner) may not withdraw from the Partnership prior to the dissolution and
winding up of the Partnership except upon the assignment of its Interests
(including any redemption, repurchase or other acquisition by the Partnership or
United Illuminating, as the case may be), in accordance with the provisions of
this Agreement. A withdrawing Partner shall not be entitled to receive any
distribution and shall not otherwise be entitled to receive the fair value of
its Interests except as otherwise expressly provided in this Agreement.
ARTICLE VI
MANAGEMENT
Section 6.1 Management of the Partnership. The General Partner shall
-----------------------------
have full, exclusive and complete discretion to manage and control the business
and affairs of the Partnership, to make all decisions affecting the business and
affairs of the Partnership and to take all such actions as it deems necessary,
appropriate or convenient to accomplish the purpose of the Partnership as set
forth herein.
Section 6.2 Expenses. The General Partner shall pay for all, and the
--------
Partnership shall not be obligated to pay, directly or indirectly, any, of the
costs and expenses of the Partnership (including, without limitation, costs and
expenses relating to the organization of, and offering of limited partner
interests in, the Partnership and costs and expenses relating to the operation
of the Partnership, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services and computing or
accounting equipment, any paying agents, registrars, transfer agents,
duplicating, travel and telephone).
Section 6.3 Powers of the General Partner. The General Partner shall
-----------------------------
have the right, power and authority in the management of the business and
affairs of the Partnership to do or cause to be done any and all acts deemed by
the General Partner to be necessary, appropriate or convenient to effectuate the
business, purposes and objectives of the Partnership. Without limiting the
generality of the foregoing, the General Partner shall have the power and
authority without any further act, vote or approval of any Limited Partner to:
(a) issue Interests, including the General Partner Interests, and the
Preferred Securities in accordance with this Agreement;
(b) act as registrar and transfer agent for the Preferred Securities;
(c) establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including with respect to
Dividends and voting rights and pay Dividends and make all other required
payments and distributions on General Partner Interests and Preferred Securities
as the Partnership's paying agent;
(d) bring and defend on behalf of the Partnership actions and
proceedings at law or in equity before any court or governmental, administrative
or other regulatory agency, body or commission or otherwise;
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(e) employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(f) secure the necessary goods and services required in performing
the General Partner's duties to the Partnership;
(g) exercise all powers of the Partnership, on behalf of the
Partnership, in connection with enforcing the Partnership's rights and interest
under the Debentures and the Guarantee;
(h) open, maintain and close bank accounts and to draw checks and
other orders for the payment of money;
(i) deposit, withdraw, invest, pay, retain and distribute the
Partnership's funds in a manner consistent with the provisions of this
Agreement;
(j) take all action that may be necessary or appropriate for the
preservation and the continuation of the Partnership's valid existence, rights,
franchises and privileges as a limited partnership under the laws of the State
of Delaware and of each other jurisdiction in which such existence is necessary
to protect the limited liability of the Limited Partners or enable the
Partnership to conduct the business in which it is engaged;
(k) take all action not inconsistent with applicable law, the
Certificate or this Agreement, as long as such action does not adversely affect
the Interests of the Preferred Security Holders, necessary to conduct its
affairs and to operate the Partnership in such a way that the Partnership would
not be deemed an "investment company" required to be registered under the
Investment Company Act of 1940, as amended, or taxed as a corporation for
federal income tax purposes and so that the Debentures will be treated as
indebtedness of United Illuminating for federal income tax purposes;
(l) cause the Partnership to enter into and perform, on behalf of the
Partnership, one or more Underwriting Agreements and cause the Partnership to
purchase Debentures without any further act, vote or approval of any Partner;
and
(m) execute all documents or instruments, perform all duties and
powers and do all things for and on behalf of the Partnership in all matters
necessary or desirable or incidental to the foregoing.
The expression of any power or authority of the General Partner in
this Agreement shall not in any way limit or exclude any other power or
authority which is not specifically or expressly set forth in this Agreement.
Section 6.4 Limits on General Partner's Powers. Anything in Section
----------------------------------
6.3 or elsewhere in this Agreement to the contrary notwithstanding, the General
Partner shall not have the power to permit or cause the Partnership:
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(a) to file a voluntary petition in bankruptcy without the affirmative
vote of the Holders of at least 66-2/3 in aggregate liquidation preference of
the outstanding Preferred Securities;
(b) to acquire any assets other than as expressly provided herein;
(c) to possess Partnership property for other than a Partnership
purpose;
(d) to admit a Person as a partner of the Partnership, except as
expressly provided in this Agreement;
(e) to make any loans to the General Partner or its Affiliates, other
than loans represented by the Debentures;
(f) to perform any act that would subject any Limited Partner to
liability as a general partner in any jurisdiction;
(g) to engage in any other activity that is not consistent with the
purpose of the Partnership, as set forth in Section 3.1;
(h) to confess a judgment against the Partnership; or
(i) subject to Section 3.1, to borrow money or become liable for the
borrowings of any third party or to engage in any financial or other trade or
business.
Section 6.5 No Management by the Limited Partners. Except as
-------------------------------------
otherwise expressly provided herein, no Limited Partner, in its capacity as
such, shall take part in the day-to-day management, operation, or control of the
business and affairs of the Partnership. The Limited Partners shall not be
agents of the Partnership and shall not have any right, power or authority to
transact any business in the name of the Partnership or to act for or on behalf
of or to bind the Partnership. Anything in this Agreement to the contrary
notwithstanding, the Limited Partners may exercise all rights provided to them,
if any, under the Indenture and the Guarantee.
Section 6.6 Limitation of Liability. Except as otherwise expressly
-----------------------
required by law, a Limited Partner, in its capacity as such, shall have no
liability in excess of (a) the amount of its capital contributions, (b) its
share of any assets and undistributed profits of the Partnership, and (c) the
amount of any distributions wrongfully distributed to it. The Limited Partners
and the Initial Limited Partner shall have no liability under this Agreement
except as expressly provided in this Agreement or the Act.
ARTICLE VII
AMENDMENTS AND MEETINGS
Section 7.1 Amendments. Except as otherwise provided in this
----------
Agreement or by any applicable terms of any Action (as hereinafter defined)
establishing a series of Preferred Securities, this Agreement may be amended by,
and only by, a written instrument executed by the General Partner; provided,
however, that (i) no amendment shall be made, and any such purported amendment
shall be void and ineffective, to the extent the result thereof
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would be to cause the Partnership to be treated as anything other than a
partnership for purposes of United States income taxation and (ii) any amendment
which would adversely affect the powers, preferences or special rights of any
series of Preferred Securities may be effected only as permitted by the terms of
such series of Preferred Securities.
Section 7.2 Meetings of the Partners.
-------------------------
(a) Meetings of the Partners may be called at any time by the General
Partner or as provided in any Action establishing a series of Preferred
Securities. Except to the extent otherwise provided in any such Action, the
following provisions shall apply to meetings of Partners.
(b) Notice of any such meeting shall be given to all Partners not less
than thirty (30) business days nor more than sixty (60) days prior to the date
of such meeting. Partners may vote in person or by proxy at such meeting.
Whenever a vote, consent or approval of Partners is permitted or required under
this Agreement, such vote, consent or approval may be given at a meeting of
Partners or by written consent.
(c) Each Partner may authorize any Person to act for it by proxy on
all matters in which a Partner is entitled to participate, including waiving
notice of any meeting, or voting or participating at a meeting. Every proxy
must be signed by the Partner or its attorney-in-fact. No proxy shall be valid
after the expiration of eleven (11) months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at the pleasure
of the Partner executing it. Except as otherwise provided in this Agreement,
all matters relating to the giving, voting or validity of proxies shall be
governed by the General Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if the Partnership were a
Delaware corporation and the Limited Partners were stockholders of a Delaware
corporation.
(d) Each meeting of Partners shall be conducted by the General Partner
or by such other Person as the General Partner may designate.
(e) The General Partner, in its sole discretion, shall establish all
other provisions relating to meetings of Partners, including notice of the time,
place or purpose of any meeting at which any matter is to be voted on by any
Partners, waiver of any such notice, action by consent without a meeting, the
establishment of a record date, quorum requirements, voting in person or by
proxy or any other matter with respect to the exercise of any such right to
vote; provided however, that unless the General Partner has established a lower
percentage, a majority of the Partners entitled to vote thereat shall constitute
a quorum at all meetings of the Partners.
ARTICLE VIII
ALLOCATIONS
Section 8.1 Profits and Losses. (a) Each fiscal period, the net
------------------
profits of the Partnership shall be allocated (i) first, to the Preferred
Security Holders, pro rata in proportion to the number of Preferred Securities
held by each such Holder, in an amount equal to the excess of (x) the Dividends
accrued on the Preferred Securities (other than Additional Amounts) since their
date of issuance through and including the close of the current fiscal period
(whether or not paid), over (y) the amount of net profits allocated to the
Preferred Security Holders pursuant to this Section 8.1(i) in all prior fiscal
periods, (ii) second, to the Preferred Security Holders to whom Additional
Amounts were paid during a fiscal period, in an amount equal to the excess of
(x) such Additional Amounts over (y) the amount of net profits allocated to the
Preferred Security Holders pursuant to this Section 8.1(ii) in all prior fiscal
periods, and (iii) thereafter, to the General Partner.
(b) Except in connection with a dissolution and liquidation of the
Partnership, the net losses of the Partnership shall be allocated each year to
the General Partner. Upon a dissolution and liquidation of the Partnership, net
losses shall be allocated to each Preferred Security Holder in an amount equal
to the excess of (x) such Preferred Security Holder's Capital Account over (y)
such Preferred Security Holder's Liquidation Distribution (as defined with
respect to each Preferred Security in the Action establishing such Preferred
Security), with any remaining net losses being allocated to the General Partner.
(c) For purposes of this Section 8.1, "net profits" and "net losses"
shall be calculated by excluding any and all costs and expenses of the
Partnership paid (or required to be paid) by the General Partner pursuant to
Section 6.2, and all such costs and expenses shall be allocated each year to the
General Partner.
(d) Notwithstanding anything to the contrary expressed or implied
in this Article VIII, the interest of the General Partner in each item of
income, gain, loss, deduction or credit of the Partnership for any fiscal period
shall at least equal one percent (1%).
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Section 8.2 Allocation Rules.
----------------
(a) For purposes of determining the profits, losses or any other items
allocable to any period, profits, losses and any such other items shall be
determined on a daily, monthly or other basis, as determined by the General
Partner using any method that is permissible under (S) 706 of the Code and the
Treasury Regulations thereunder.
(b) The Partners are aware of the income tax consequences of the
allocations made by this Article VIII and hereby agree to be bound by the
provisions of this Article VIII in reporting their shares of Partnership income
and loss for income tax purposes.
Section 8.3 Qualified Income Offset. If during any taxable year, a
-----------------------
Partner unexpectedly receives an adjustment, allocation or distribution
described in Treasury Regulations (S) 1.704-1(b)(2)(ii)(4), (5) or (6), which
causes or increases a deficit balance in the Partner's Adjusted Capital Account
(as defined below), there shall be allocated to the Partner items of Partnership
income and gain (consisting of a pro rata portion of each item of Partnership
income, including gross income and gain for such year) in an amount and manner
sufficient to eliminate such deficit. The foregoing is intended to be a
"qualified income offset" provision as described in Treasury Regulations (S)
1.704-1(b)(2)(ii)(d) and shall be interpreted and applied to all respects in
accordance with that Regulation. For the purposes of the preceding sentence, a
Partner's "Adjusted Capital Account" at any time shall equal the Partner's
Capital Account at such time (x) increased by the sum of (A) any amounts that
such Partner is obligated to restore to the Partnership pursuant to Treasury
Regulation (S)1.(B) the amount of the Partner's share of Partnership minimum
gain (as defined in Treasury Regulations (S) 1.704(g)(1) and (3)) and (C) the
amount of the Partner's share of the minimum gain attributed to a "partner non-
recourse debt" (as defined in Treasury Regulations (S) 1.704.2(i)(5)) and (y)
decreased by reasonably expected adjustments, allocations and distributions
described in Treasury Regulations (S)(S) 1.704-1(b)(2)(ii)(d)(4), (5) and (6).
Section 8.4 Nonrecourse Debt. While this Agreement does not provide
----------------
certain provisions required by Treasury Regulations (S)(S) 1.704-1(b) and 1.704-
2 because those provisions apply to transactions that are not expected to occur,
the Partners intend that the allocations under Section 8.1 conform to Treasury
Regulations (S)(S) 1.704-1(b) and 1.704-2 (including, without limitation, the
minimum gain chargeback, chargeback of partner
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nonrecourse debt minimum gain and partner nonrecourse debt provisions of such
Regulation), and the General Partner shall make such charges in the allocations
under Section 8.1 as it believes are reasonably necessary to meet the
requirements of such Regulations.
Section 8.5 Tax Allocations. For purposes of Article VII and Federal,
---------------
state and local income tax purposes, taxable income or taxable loss of the
Partnership (or any item thereof) for each fiscal period shall be determined in
accordance with Federal tax accounting principles rather than generally accepted
accounting principles and shall be allocated to and among the Partners in order
to reflect the allocations made pursuant to the provision of Article VIII for
such fiscal period, taking into account any variation between the adjusted tax
basis and the book value of Partnership property in accordance with the
principles of Code (S) 704(c).
ARTICLE IX
DIVIDENDS
Section 9.1 Dividends. Limited Partners shall receive periodic
---------
Dividends, if any, redemption payments and Liquidation Distributions in
accordance with the applicable terms of the Preferred Securities. Subject to
the rights of the Preferred Securities, all remaining cash shall be distributed
to the General Partner at such time as the General Partner shall determine.
Section 9.2 Limitations on Distributions. Notwithstanding any
----------------------------
provision to the contrary contained in this Agreement, (a) the Partnership shall
not make a distribution (including a Dividend) to any Partner on account of its
interest in the Partnership if such distribution (including a Dividend) would
violate (S)17-607 of the Act or other applicable law, (b) the Partnership shall
not make a distribution (including a Dividend) to any Partner to the extent that
such distribution, if made, would create or increase a deficit in the Capital
Account of such Partner and (c) other than distributions upon liquidation of the
Partnership or in connection with a Special Event, no distribution shall be
made in kind.
Section 9.3 Withholding. The Partnership shall comply with all
-----------
withholding requirements under federal, state and local law. The Partnership
shall request, and the Partners shall provide to the Partnership, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Partner, and any representations and forms as shall reasonably
be requested by the Partnership to assist it in determining the extent of, and
in fulfilling, its withholding obligations. The Partnership shall file required
forms with applicable jurisdictions and, unless an exemption from withholding is
properly established by a Partner, shall remit amounts withheld with respect to
the Partners to applicable jurisdictions. To the extent that the Partnership is
required to withhold and pay over any amounts to any authority with respect to
distributions or allocations to any Partner, the amount withheld shall be deemed
to be a distribution in the amount of the withholding to the Partner. In the
event of any claimed overwithholding, Partners shall be limited to an action
against the applicable jurisdiction. If the amount withheld was not withheld
from actual distributions, the Partnership may reduce subsequent distributions
by the amount of such withholding.
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ARTICLE X
THE GENERAL PARTNER INTERESTS AND
PREFERRED SECURITIES; GUARANTEE
Section 10.1 Interests of the Partners.
--------------------------
(a) United Illuminating or any successor thereto shall be the sole
general partner of the Partnership and shall hold all of the General Partner
Interests of the Partnership.
(b) The aggregate number of Preferred Securities which the
Partnership shall have authority to issue is unlimited.
Section 10.2 Preferred Securities.
--------------------
(a) The General Partner on behalf of the Partnership is authorized to
issue limited partner interests (the "Preferred Securities"), in one or more
series, having such designations, rights, privileges, restrictions, preferences
and other terms and provisions as may from time to time be established in a
written action or actions (each, an "Action") of the General Partner providing
for issue of such series. In connection with the foregoing, the General Partner
is expressly authorized, prior to issuance, to set forth in an Action or Actions
providing for the issue of such series, the following:
(i) the distinctive designation of such series which shall
distinguish it from other series;
(ii) the number of Preferred Securities included in such series;
(iii) the annual Dividend rate (or method of determining such rate)
for Preferred Securities of such series and the date or dates upon which such
Dividends shall be payable; provided, however, Dividends on the Preferred
Securities of any series shall be payable on a monthly basis to Holders of the
Preferred Securities of such series as of a record date in each calendar month
during which the Preferred Securities of such series are outstanding.
(iv) whether Dividends on the Preferred Securities of such series
shall be cumulative, and, in the case of Preferred Securities of any series
having cumulative Dividend rights, the date or dates or method of determining
the date or dates from which Dividends on the Preferred Securities of such
series shall be cumulative;
(v) the amount or amounts which shall be paid out of the assets of the
Partnership to the Holders of the Preferred Securities of such series upon
voluntary or involuntary dissolution, liquidation or winding up of the
Partnership;
(vi) the price or prices at which, the period or periods within which
and the terms and conditions upon which the Preferred Securities of such series
may be redeemed or purchased, in whole or in part, at the option of the
Partnership;
(vii) the obligation, if any, of the Partnership to purchase or redeem
Preferred Securities of such series pursuant to a sinking fund or otherwise and
the price or prices at which, the period or periods within which and the terms
and conditions upon which the
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Preferred Securities of such series shall be redeemed, in whole or in part,
pursuant to such obligation;
(viii) the period or periods within which and the terms and
conditions, if any, including the price or prices or the rate or rates of
conversion or exchange and the terms and conditions of any adjustments thereof,
upon which the Preferred Securities of such series shall be convertible or
exchangeable at the option of the Preferred Security Holder, the Partnership or
United Illuminating into any other Interests or securities or other property or
cash or into any other series of Preferred Securities;
(ix) the voting rights, if any, of the Preferred Securities of such
series in addition to those required by law, including the number of votes per
Preferred Security and any requirement for the approval by the Holders, or of
the Preferred Securities of one or more series, or of both, as a condition to
specified Action or amendments to this Agreement;
(x) the ranking of the Preferred Securities of the series as compared
with Preferred Securities of other series in respect of the right to receive
Dividends and the right to receive payments out of the assets of the Partnership
upon voluntary or involuntary dissolution, winding up or termination of the
Partnership;
(xi) the nature and terms of the Debentures and any other backup
undertakings of United Illuminating and/or another subsidiary of United
Illuminating to be provided to Holders of such series;
(xii) the additional amounts, if any, that the Partnership will pay as
a distribution as necessary in order that the net amounts received by the
Holders of such series after withholding or deduction on account of certain
taxes, duties, assessments or governmental charges will equal the amount that
would have been receivable in respect of the Preferred Securities of such series
in the absence of such withholding or deduction ("Additional Amounts"); and
(xiii) any other relative rights, powers and duties of the Preferred
Securities of the series not inconsistent with this Agreement or with applicable
law;
provided that the proceeds of the issuance of each such series of Preferred
Securities, together with the proceeds of any related capital contribution of
the General Partner, shall be lent to United Illuminating in return for a
concurrently issued series of Debentures in aggregate principal amount equal to
the aggregate liquidation preference of the Preferred Securities of such series
and the related capital contribution, bearing interest at an annual rate equal
to the annual Dividend rate on such Preferred Securities payable at such times
as the Dividends on such Preferred Securities, and having certain redemption
provisions which correspond to the redemption provisions for such Preferred
Securities.
(b) In connection with the foregoing and without limiting the
generality thereof, the General Partner is hereby expressly authorized, without
the vote or approval of any Partner or Holder, to take any Action to create
under the provisions of this Agreement a series of Preferred Securities that was
not previously outstanding, including a series ranking junior to other series of
Preferred Securities in respect of the right to receive
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Dividends and the right to receive payments out of assets of the Partnership
upon voluntary or involuntary dissolution, liquidation or winding up of the
Partnership. Without the vote or approval of any Partner or Holder, the General
Partner may execute, swear to, acknowledge, deliver, file and record whatever
documents may be required in connection with the issue from time to time of
Preferred Securities in one or more series as shall be necessary, convenient or
desirable to reflect the issue of such series. The General Partner shall do all
things it deems to be appropriate or necessary to comply with the Act and is
authorized and directed to do all things it deems to be necessary or permissible
in connection with any future issuance, including compliance with any statute,
rule, regulation or guideline of any federal, state or other governmental agency
or any securities exchange.
(c) Any Action or Actions taken by the General Partner pursuant to the
provisions of this Section 10.2 shall be deemed an amendment and supplement to
and part of this Agreement.
(d) All Preferred Securities shall rank senior to the General Partner
Interests in respect of the right to receive Dividends or other property
distributions and the right to receive payments out of the assets of the
Partnership upon voluntary or involuntary dissolution, liquidation or winding up
of the Partnership. All Preferred Securities redeemed, purchased or otherwise
acquired by the Partnership (including Preferred Securities surrendered for
conversion or exchange) shall be cancelled and thereupon restored to the status
of authorized but unissued Preferred Securities undesignated as to series.
(e) No Holder shall be entitled as a matter of right to subscribe for
or purchase, or have any preemptive right with respect to, any part of any new
series or additional issue of an existing series of Preferred Securities, or of
interests or securities convertible into any Preferred Securities, whether now
or hereafter authorized and whether issued for cash or other consideration or by
way of Dividend or distribution.
(f) Except as otherwise provided in this Agreement or by the General
Partner in accordance with Section 10.2(a) above in respect of any series of
Preferred Securities and as otherwise required by law, all management of the
Partnership shall be vested exclusively in the General Partner.
(g) Any Person acquiring Preferred Securities shall be admitted to the
Partnership as a Limited Partner upon compliance with Section 2.2.
(h) So long as the Partnership holds the Debentures of any series, the
General Partner shall not waive compliance or waive any past default in
compliance by United Illuminating with any covenant or other term in the
Debentures of such series or the Indenture, or any past default under the
Indenture, without the approval or consent of the Holders of at least 66-2/3% in
aggregate liquidation preference of the outstanding Preferred Securities.
(i) The General Partner shall not consent to a supplemental indenture
under the Indenture without the prior consent, obtained as provided in this
Agreement, of the Holders of at least 66-2/3% in aggregate liquidation
preference of the outstanding Preferred Securities affected, considered as one
class, or, in the case of changes described in clauses (a) through
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(e) of Section 1202 of the Indenture, of the Holders of 100% in aggregate
liquidation preference of the outstanding Preferred Securities affected,
considered as one class; if any other action is, by the terms of the Indenture,
not permitted to be taken by the Partnership without the consent of Preferred
Securities Holders or any Special Representative appointed with respect to any
series of Preferred Securities, the General Partner shall not, without such
requisite consent, take any such action; and the General Partner shall not
revoke any action previously authorized and approved by a vote of the Preferred
Securities of any series affected thereby.
(j) The General Partner shall notify holders of Preferred Securities
of each series of any notice of default received from the trustee under the
Indenture with respect to the related series of Debentures.
Section 10.3 Guarantee. The payment of Dividends and payments upon
---------
dissolution of the Partnership or redemption in respect of Preferred Securities
shall be guaranteed by United Illuminating pursuant to the Guarantee. The
Preferred Security Holders hereby authorize the General Partner to hold the
Guarantee on behalf of the Preferred Security Holders. In the event of the
appointment of a Special Representative to, among other things, enforce the
Guarantee, the Special Representative may take possession of the Guarantee for
such purpose. If no Special Representative has been appointed to enforce the
Guarantee, the General Partner has the right to enforce the Guarantee on behalf
of the Preferred Security Holders. The Holders of not less than 10% in
liquidation preference of the Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available in
respect to the Guarantee, including the giving of directions to the General
Partner or the Special Representative, as the case may be. If the General
Partner or the Special Representative fails to enforce the Guarantee as above
provided, a Preferred Security Holder may institute a legal proceeding directly
against United Illuminating to enforce its rights and those of the other
Preferred Security Holders under the Guarantee, without first instituting a
legal proceeding against the Partnership or any other Person. The Preferred
Security Holders, by acceptance of such Preferred Securities, hereby agree to
the subordination provisions and other terms of the Guarantee.
ARTICLE XI
BOOKS AND RECORDS
Section 11.1 Books, Records and Financial Statements.
---------------------------------------
(a) At all times during the continuance of the Partnership, the
Partnership shall maintain, at its principal place of business, separate books
of account for the Partnership that shall show a true and accurate record of all
costs and expenses incurred, all charges made, all credits made and received and
all income derived in connection with the operation of the Partnership's
business in accordance with generally accepted accounting principles
consistently applied, and, to the extent inconsistent therewith, in accordance
with this Agreement. Such books of account, together with a copy of this
Agreement and a certified copy of the Certificate, shall at all times be
maintained at the principal place of business of the Partnership and shall be
open to inspection and examination at reasonable times by each Limited Partner
or its duly authorized representative for any purpose reasonably related to such
Limited Partner's interest in the Partnership.
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(b) Notwithstanding any other provision of this Agreement, the General
Partner may, to the maximum extent permitted by applicable law, keep
confidential from the Limited Partners any information the disclosure of which
the General Partner reasonably believes is not in the best interests of the
Partnership or is adverse to the interests of the Partnership or which the
Partnership or the General Partner is required by law or by an agreement with
any Person to keep confidential.
(c) The General Partner shall prepare and maintain, or cause to be
prepared and maintained, the books of account of the Partnership and within
three (3) months after the close of each Fiscal Year the General Partner shall
transmit to each Partner a statement indicating such Partner's share of each
item of Partnership income, gain, loss, deduction or credit for such Fiscal Year
for Federal income tax purposes.
Section 11.2 Accounting Method. For both financial and tax reporting
-----------------
purposes and for purposes of determining profits and losses, the books and
records of the Partnership shall be kept on the accrual method of accounting
applied in a consistent manner and shall reflect all Partnership transactions
and be appropriate and adequate for the Partnership's business.
ARTICLE XII
TAX MATTERS
Section 12.1 Tax Matters Partner. The General Partner is hereby
-------------------
designated as "Tax Matters Partner" of the Partnership for purposes of (S)
6231(a)(7) of the Code and shall have the power to manage and control, on behalf
of the Partnership, any administrative proceeding at the Partnership level with
the Internal Revenue Service relating to the determination of any item of
Partnership income, gain, loss, deduction or credit for Federal income tax
purposes. The General Partner shall keep the Limited Partners fully informed of
any inquiry, examination or proceeding with respect to any such matter.
Section 12.2 No Right to Make Section 754 Election. The General
-------------------------------------
Partner shall not make an election in accordance with (S) 754 of the Code.
Section 12.3 Taxation as Partnership. The General Partner and the
-----------------------
Preferred Security Holders acknowledge that they intend, for Federal income tax
purposes, that the Partnership shall be treated as a partnership and that the
General Partner and the Holders shall be treated as Partners of such Partnership
for such purposes.
ARTICLE XIII
EXCULPATION AND INDEMNIFICATION
Section 13.1 Exculpation.
-----------
(a) No Covered Person shall be liable to the Partnership or any
Indemnified Person for any loss, damage or claim incurred by reason of any act
or omission performed or omitted by such Covered Person in good faith on behalf
of the Partnership and in a manner reasonably believed to be within the scope of
authority conferred on such Covered Person by this Agreement, except that a
Covered Person shall be liable for any such loss, damage
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or claim incurred by reason of such Covered Person's gross negligence, bad
faith, recklessness or willful misconduct.
(b) Each Covered Person shall be fully protected in relying in good
faith upon the records of the Partnership and upon such information, opinions,
reports or statements presented to the Partnership by any Person as to matters
such Covered Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Partnership, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which distributions to Partners might properly be paid.
Section 13.2 Duties.
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(a) To the extent that, at law or in equity, a Covered Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Partnership or to any Indemnified Person, such Covered Person acting under this
Agreement shall not be liable to the Partnership or to any other Indemnified
Person for its good faith reliance on the provisions of this Agreement. The
provisions of this Agreement, to the extent that they restrict the duties and
liabilities of a Covered Person otherwise existing at law or in equity, are
agreed by the parties hereto to replace such other duties and liabilities of
such Covered Person.
(b) Unless otherwise expressly provided herein, (a) whenever a
conflict of interest exists or arises between a Covered Person, on the one hand,
and the Partnership or a Limited Partner, on the other hand, or (b) whenever
this Agreement or any other agreement contemplated herein or therein provides
that a Covered Person shall act in a manner that is, or provide terms that are,
fair and reasonable to the Partnership or any Partner, such Covered Person shall
resolve such conflict of interest, take such action or provide such terms,
considering in each case the relative interest of each party (including its own
interest) to such conflict, agreement, transaction or situation and the benefits
and burdens relating to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting practices or
principles. In the absence of gross negligence, recklessness, bad faith or
willful misconduct by the Covered Person, the resolution, action or term so
made, taken or provided by such Covered Person shall not constitute a breach of
this Agreement or any other agreement contemplated herein or of any duty or
obligation of such Covered Person at law or in equity or otherwise.
(c) Whenever in this Agreement the General Partner or an Indemnified
Person is permitted or required to make a decision (i) in its "discretion" or
under a grant of similar authority, the General Partner or such Indemnified
Person shall be entitled to consider only such interests and factors as it
desires, including its own interests, or (ii) in its "good faith" or under
another express standard, the General Partner or such Indemnified Person shall
act under such express standard and shall not be subject to any other or
different standard imposed by this Agreement or other applicable law.
Section 13.3 Indemnification. To the fullest extent permitted by
---------------
applicable law, an Indemnified Person shall be entitled to indemnification from
the Partnership for any loss, damage or claim incurred by such Indemnified
Person by reason of any act or omission performed or omitted by such Indemnified
Person in good faith on behalf of the Partnership
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and in a manner reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Agreement, except that no
Indemnified Person shall be entitled to be indemnified in respect of any loss,
damage or claim incurred by such Indemnified Person by reason of gross
negligence, recklessness, bad faith or willful misconduct with respect to such
acts or omissions; provided, however, that any indemnity under this Section 13.3
--------- -------
shall be provided out of and to the extent of Partnership assets only, and no
Covered Person shall have any personal liability on account thereof, except as
otherwise provided by Section 13.6(a) or the Act.
Section 13.4 Expenses. To the fullest extent permitted by applicable
--------
law, expenses (including legal fees) incurred by an Indemnified Person in
defending any claim, demand, action, suit or proceeding may, from time to time,
be advanced by the Partnership prior to the final disposition of such claim,
demand, action, suit or proceeding upon receipt by the Partnership of an
undertaking by or on behalf of the Indemnified Person to repay such amount if it
shall be determined that the Indemnified Person is not entitled to be
indemnified as authorized in Section 13.3 hereof.
Section 13.5 Outside Businesses. Any Partner or Affiliate thereof may
------------------
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Partnership, and the Partnership and the Partners shall have no rights by
virtue of this Agreement in and to such independent ventures or the income or
profits derived therefrom, and the pursuit of any such venture, even if
competitive with the business of the Partnership, shall not be deemed wrongful
or improper. No Partner or Affiliate thereof shall be obligated to present any
particular investment opportunity to the Partnership even if such opportunity is
of a character that, if presented to the Partnership, could be taken by the
Partnership, and any Partner or Affiliate thereof shall have the right to take
for its own account (individually or as a partner or fiduciary) or to recommend
to others any such particular investment opportunity.
Section 13.6 Liability of the General Partner.
--------------------------------
(a) Except as otherwise provided in the Act, the General Partner shall
have the liabilities of a partner in a partnership without limited partners to
any Person other than the Partnership and the Limited Partners. Except as
otherwise provided in this Agreement or the Act, the General Partner shall have
the liabilities of a partner in a partnership without limited partners to the
Partnership and each Limited Partner.
(b) The General Partner has and shall maintain throughout the term of
the Partnership a net worth (without taking into account its interest in the
Partnership) of at least 10% of the total contributions to the Partnership.
Section 13.7 Waiver by General Partner. Indemnification of
----------------------------------------------
Partnership by General Partner. The General Partner hereby waives all rights of
- -------------------------------
indemnification which it may have against the Partnership under this Agreement
or otherwise. The General Partner also hereby agrees to indemnify and hold
harmless the Partnership for (i) any payments made by it under this Article
XIII, and (ii) any indemnity payments the Partnership may otherwise be required
to make under applicable law.
ARTICLE XIV
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TRANSFERS
Section 14.1 Transfer of Interests.
---------------------
(a) Preferred Securities shall be freely transferable by a Preferred
Security Holder.
(b) The General Partner may not assign its interest in the Partnership
in whole or in part under any circumstances, except to a successor of United
Illuminating under the Indenture. Any such assignee of all or a part of the
Interest of a General Partner in the Partnership shall be admitted to the
Partnership as a general partner of the Partnership immediately prior to the
effective date of such assignment, and such additional or successor General
Partner is hereby authorized to and shall continue the business of the
Partnership without dissolution.
(c) No Interest shall be transferred, in whole or in part, except in
accordance with the terms and conditions set forth in this Agreement. Any
transfer or purported transfer of any Interest not made in accordance with this
Agreement shall be null and void.
Section 14.2 Transfer of LP Certificates. The General Partner shall
---------------------------
provide for the registration of LP Certificates and of transfers of LP
Certificates without charge by or on behalf of the Partnership upon payment by
transferor in respect of any tax or other governmental charges which may be
imposed in relation to such transfer, together with transferor's furnishing such
indemnity as the General Partner may require. Upon surrender for registration
of transfer of any LP Certificate, the General Partner shall cause one or more
new LP Certificates to be issued in the name of the designated transferee or
transferees. Every LP Certificate surrendered for registration of transfer
shall be accompanied by a written instrument of transfer in form satisfactory to
the General Partner duly executed by the Preferred Security Holder or his or her
attorney duly authorized in writing. Each LP Certificate surrendered for
registration of transfer shall be cancelled by the General Partner. A
transferee of an LP Certificate shall be admitted to the Partnership as a
Limited Partner and shall be entitled to the rights and subject to the
obligations of a Preferred Security Holder hereunder upon the receipt by such
transferee of an LP Certificate. The transferor of an LP Certificate shall
cease to be a limited partner of the Partnership at the time that the transferee
of the LP Certificate is admitted to the Partnership as a Limited Partner in
accordance with this Section 14.2.
Section 14.3 Persons Deemed Preferred Security Holders. The
-----------------------------------------
Partnership may treat the Person in whose name any LP Certificate shall be
registered on the books and records of the Partnership as the Preferred Security
Holder and the sole holder of such LP Certificate for purposes of receiving
Dividends and for all other purposes whatsoever and, accordingly, shall not be
bound to recognize any equitable or other claim to or interest in such LP
Certificate on the part of any other Person, whether or not the Partnership
shall have actual or other notice thereof.
Section 14.4 Book-Entry Interests. The LP Certificates, on original
--------------------
issuance, will be issued in the form of a global LP Certificate or LP
Certificates representing Book-Entry Interests, to be delivered to the
Depository, by, or on behalf of, the Partnership. Such LP Certificate or LP
Certificates shall initially be registered on the books and records of the
Partnership in the name of the Depository or its nominee, and no Preferred
Security Owner
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will receive a definitive LP Certificate representing such Preferred Security
Owner's interests in such LP Certificate, except as provided in Section 14.6.
Unless and until definitive, fully registered LP Certificates (the ''Definitive
LP Certificates") have been issued to the Preferred Security Owners pursuant to
Section 14.6:
(a) The provisions of this Section 14.4 shall be in full force and
effect;
(b) The Partnership and the General Partner shall be entitled to deal
with the Depository for all purposes of this Agreement (including the payment of
Dividends on the LP Certificates and receiving approvals, votes or consents
hereunder) as the Preferred Security Holder and the sole holder of the LP
Certificates and shall have no obligation to the Preferred Security Owners;
(c) To the extent that the provisions of this Section conflict with
any other provisions of this Agreement, the provisions of this Section shall
control; and
(d) The rights of the Preferred Security Owners shall be exercised
only through the Depository and shall be limited to those established by law and
agreements between such Preferred Security Owners and the Depository and/or the
Depository participants. Unless and until the Definitive LP Certificates are
issued pursuant to Section 14.6, the Depository will be responsible for making
book-entry transfers among its participants and accepting and transmitting
payments of Dividends on the LP Certificates to such participants.
Section 14.5 Notices to the Depository. Whenever a notice or other
-------------------------
communication to the Preferred Security Holders is required under this
Agreement, unless and until Definitive LP Certificates shall have been issued to
the Preferred Security Owners pursuant to Section 14.6, the General Partner
shall give all such notices and communications specified herein to be given to
the Preferred Security Holders to the Depository, and shall have no obligations
to the Preferred Security Owners.
Section 14.6 Definitive LP Certificates. If (a) the Depository elects
--------------------------
to discontinue its services as securities depository and gives reasonable notice
to the Partnership, or (b) the Partnership elects to terminate the book-entry
system through the Depository then the Partnership shall either (i) appoint a
successor Depository or (ii) cause Definitive LP Certificates to be prepared by
the Partnership. Upon surrender of the global LP Certificate or LP Certificates
representing the Book-Entry Interests by the Depository, accompanied by
registration instructions, the General Partner shall cause Definitive LP
Certificates to be delivered to Preferred Security Owners in accordance with the
instructions of the Depository. Neither the General Partner nor the Partnership
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Any Person who is to receive a Definitive LP Certificate in accordance with this
Article XIV shall be admitted to the Partnership as a Limited Partner upon
registration of the Preferred Securities in the name of the Person on the books
and records of the Partnership and issuance of such Definitive LP Certificate.
The Depository or the nominee of the Depository, as the case may be, shall cease
to be a limited partner of the Partnership under this Section 14.6 at the time
that at least one additional Person is admitted to the Partnership as a Limited
Partner in accordance with this Section 14.6. The Definitive LP Certificates
shall be printed, lithographed or engraved or may be produced in any other
manner as is reasonably acceptable to the General Partner, as evidenced by its
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execution thereof, and shall conform to the requirements of any securities
exchange upon which the Preferred Securities evidenced by such Definitive LP
Certificates are then quoted or listed and admitted for trading.
In addition, in the event that the Partnership exercises its option to
redeem only a portion of the Preferred Securities of any series because it is or
would be required to withhold or deduct Additional Amounts with respect to such
portion, the Partnership may cause the global LP Certificate or LP Certificates
representing all of the Book-Entry Interests therein to be withdrawn from the
Depository and issue Definitive LP Certificates representing the remaining
Preferred Securities of such series. Thereafter, the portion of the Preferred
Securities of such series subject to such requirement to withholding or deduct
Additional Amounts will be redeemed.
Section 14.7 Surrender of Preferred Securities by General Partner. If
----------------------------------------------------
at any time United Illuminating shall surrender any Preferred Securities of a
particular series to the Partnership, the Partnership shall surrender to or upon
the order of United Illuminating Debentures of the series issued concurrently
with the Preferred Securities so surrendered, in aggregate principal amount
equal to the aggregate liquidation preference of such Preferred Securities so
surrendered.
ARTICLE XV
DISSOLUTION, LIQUIDATION AND TERMINATION
Section 15.1 No Dissolution. The Partnership shall not be dissolved
--------------
by the admission of additional or successor Partners in accordance with the
terms of this Agreement. The death, withdrawal, incompetency, bankruptcy,
dissolution or other cessation to exist as a legal entity of a Limited Partner,
or the occurrence of any other event which terminates the Interest of a Limited
Partner in the Partnership, shall not in and of itself cause the Partnership to
be dissolved and its affairs wound up. To the fullest extent permitted by
applicable law, upon the occurrence of any such event, the General Partner may,
without any further act, vote or approval of any Partner, admit any Person to
the Partnership as an additional or substitute Limited Partner, which admission
shall be effective as of the date of the occurrence of such event, and the
business of the Partnership shall be continued without dissolution.
Section 15.2 Events Causing Dissolution. The Partnership shall be
--------------------------
dissolved and its affairs shall be wound up upon the occurrence of any of the
following events:
(a) the expiration of the term of the Partnership, as provided in
Section 2.4 hereof;
(b) the withdrawal, removal or Bankruptcy of the General Partner or
assignment by the General Partner of its entire Interest in the Partnership when
the assignee is not admitted to the Partnership as an additional or successor
General Partner in accordance with Section 14.1(b), or the occurrence of any
other event that results in the General Partner ceasing to be a general partner
of the Partnership under the Act, unless, in any such case, the business of the
Partnership is continued in accordance with the Act or within 90 days after the
date of such event, a majority of the Limited Partners elect to continue the
business of the Partnership in a reconstituted form if necessary, and elect a
successor General Partner effective as of the date of such withdrawal;
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(c) the entry of a decree of judicial dissolution under (S)17-802 of
the Act; or
(d) the written consent of all Partners.
Section 15.3 Notice of Dissolution. Upon the dissolution of the
---------------------
Partnership, the General Partner, as liquidating trustee, shall promptly notify
the Partners of such dissolution.
Section 15.4 Liquidation. Upon dissolution of the Partnership, the
-----------
General Partner, as liquidating trustee, shall immediately commence to wind up
the Partnership's affairs; provided, however, that a reasonable time shall be
-------- -------
allowed for the orderly liquidation of the assets of the Partnership and the
satisfaction of liabilities to creditors so as to enable the Partners to
minimize the normal losses attendant upon a liquidation. The Preferred Security
Holders shall continue to share profits and losses during liquidation in the
same proportions, as specified in Article VIII hereof, as before liquidation.
The proceeds of liquidation shall be distributed, as realized, in the following
order and priority:
(a) to creditors of the Partnership, including Partners who are
creditors, to the extent permitted by law, in satisfaction of the liabilities of
the Partnership (whether by payment or the making of reasonable provision for
payment thereof, other than liabilities for distributions (including Dividends)
to Partners);
(b) to the Preferred Security Holders of each series then outstanding
in accordance with their respective interests and in the amount of their
respective Liquidation Distributions; and
(c) to all Partners in accordance with their respective positive
Capital Account balances maintained in accordance with Section 4.3, after giving
effect to all contributions, distributions and allocations for all periods.
Section 15.5 Termination. The Partnership shall terminate when all of
-----------
the assets of the Partnership shall have been distributed in the manner provided
for in this Article XV, and the Certificate shall have been cancelled in the
manner required by the Act.
Section 15.6 Rights of Limited Partners. Each Limited Partner shall
--------------------------
look solely to the assets of the Partnership for all distributions with respect
to the Partnership and such Partner's capital contribution (including return
thereof), and such Partner's share of profits and losses thereof, and shall have
no recourse therefor (upon dissolution or otherwise) against the General
Partner. No Partner shall have any right to demand or receive property other
than cash upon dissolution and termination of the Partnership.
ARTICLE XVI
MISCELLANEOUS
Section 16.1 Notices. All notices provided for in this Agreement
-------
shall be in writing, duly signed by the party giving such notice.
(a) All notices provided for in this Agreement to the Partnership or
General Partner shall be delivered, telecopied or mailed by registered or
certified mail, as follows:
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(i) if given to the Partnership, in care of the General Partner at
the Partnership's mailing address set forth below:
c/o The United Illuminating Company
157 Church Street
New Haven, Connecticut 06510
Telecopy: (203) 499-2414
Telephone: (203) 499-2592
Attention: Treasurer
(ii) if given to the General Partner, at its mailing address set
forth below:
The United Illuminating Company
157 Church Street
New Haven, Connecticut 06510
Telecopy: (203) 499-2414
Telephone: (203) 499-2592
Attention: Treasurer
All such notices shall be deemed to have been given when received.
(b) All notices provided for in this Agreement to any other Partner
shall be given at the address set forth on the books and records of the
Partnership, by mail, first-class postage prepaid, and shall be deemed given
when so mailed.
Section 16.2 Failure to Pursue Remedies. The failure of any party to
--------------------------
seek redress for violation of, or to insist upon the strict performance of, any
provision of this Agreement shall not prevent a subsequent act, which would have
originally constituted a violation, from having the effect of an original
violation.
Section 16.3 Cumulative Remedies. The rights and remedies provided by
--------------------
this Agreement are cumulative and the use of any one right or remedy by any
party shall not preclude or waive its right to use any or all other remedies.
Said rights and remedies are given in addition to any other rights the parties
may have by law, statute, ordinance or otherwise.
Section 16.4 Binding Effect. This Agreement shall be binding upon and
--------------
inure to the benefit of all of the parties and, to the extent permitted by this
Agreement, their successors, legal representatives and assigns.
Section 16.5 Interpretation. Throughout this Agreement, nouns,
--------------
pronouns and verbs shall be construed as singular or plural, whichever shall be
applicable. All references herein to "Articles", "Sections" and "paragraphs"
shall refer to corresponding provisions of this Agreement.
Section 16.6 Severability. The invalidity or unenforceability of any
------------
particular provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be construed in all respects as if such invalid
or unenforceable provision were omitted.
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Section 16.7 Counterparts. This Agreement may be executed in any
------------
number of counterparts with the same effect as if all parties hereto had signed
the same document. All counterparts shall be construed together and shall
constitute one instrument.
Section 16.8 Integration. This Agreement constitutes the entire
------------
agreement among the parties hereto pertaining to the subject matter hereof and
supersedes all prior agreements and understandings pertaining thereto.
Section 16.9 Governing Law. This Agreement and the rights of the
--------------
parties hereunder shall be interpreted in accordance with the laws of the State
of Delaware, and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 16.10 Headings. The headings and subheadings in this
--------
Agreement are included for convenience and identification only and are in no way
intended to describe, interpret, define or limit the scope, extent or intent of
this Agreement or any provision hereof.
Section 16.11 Power of Attorney. Appointment of General Partner. (a)
--------------------------------------------------
Each Limited Partner hereby irrevocably constitutes and appoints the General
Partner as its true and lawful attorney in fact, in its name, place, and stead,
to make, execute, acknowledge, and file the following documents, to the extent
consistent with the other provisions of this Agreement:
(i) This Agreement, and, to the extent required by law, the
Certificate;
(ii) Any fictitious or assumed-name certificates required to be filed
on behalf of the Partnership;
(iii) Any application or registration to do business in any State
other than, or in addition to, the State of Delaware;
(iv) Deeds, notes, mortgages, pledges, security instruments of any
kind and nature, leases, and such other instruments as may be necessary to carry
on the business of the Partnership; provided that no such instrument shall
increase the personal liability of the Limited Partners;
(v) All certificates and other instruments that the General Partner
deems appropriate or necessary to form and qualify, or continue the
qualification of, the Partnership as a limited partnership in the State of
Delaware and all jurisdictions in which the Partnership may intend to conduct
business or own property;
(vi) Any duly adopted amendment to or restatement of this Agreement
or the Certificate;
(vii) All conveyances and other instruments or documents that the
General Partner deems appropriate or necessary to effect or reflect the
dissolution, liquidation and termination of the Partnership pursuant to the
terms of this Agreement (including a certificate of cancellation); and
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<PAGE>
(viii) All other instruments as the attorneys-in-fact or any of them
may deem necessary or advisable to carry out fully the provisions of this
Agreement in accordance with its terms.
(b) It is expressly intended by each Limited Partner that the power of
attorney granted by Section 16.11(a) is coupled with an interest, shall be
irrevocable, and shall survive and not be affected by the subsequent disability
or incapacity of such Limited Partner (or if such Limited Partner is a
corporation, partnership, trust, association, limited liability company or other
legal entity, by the dissolution or termination thereof).
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above stated.
GENERAL PARTNER:
THE UNITED ILLUMINATING COMPANY
By
-------------------------------
Name:
Title:
INITIAL LIMITED PARTNER:
UNITED RESOURCES, INC.
By
-------------------------------
Name:
Title:
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<PAGE>
Exhibit 4(C)(A)
===============================================================================
Certificate Number Number of Preferred Securities
===============================================================================
R-1
===============================================================================
CUSIP NO.
Certificate Evidencing Preferred Securities
of
United Capital Funding Partnership L.P.
___% Preferred Capital Securities, Series ___
(liquidation preference $25 per security)
United Capital L.P., a limited partnership formed under the laws of the
State of Delaware (the "Partnership"), hereby certifies that __________________
_______ (the "Preferred Security Holder") is the registered owner of __________
(___) preferred securities of the Partnership representing Interests in the
Partnership of a series designated the ___% Preferred Capital Securities,
Series ___ (liquidation preference $25 per security) (the "Series ___ Preferred
Securities"). The Series ___ Preferred Securities are fully paid and
nonassessable Interests in the Partnership, as to which the limited partners
of the Partnership who hold the Series ___ Preferred Securities, in their
capacities as limited partners of the Partnership, will have no liability solely
by reason of being Preferred Security Holders in excess of their obligations to
make payments provided for in the Limited Partnership Agreement (as defined
below) and their share of the Partnership's assets and undistributed profits
(subject to the obligation of a Preferred Security Holder to repay any funds
wrongfully distributed to it). The Series ___ Preferred Securities are
transferable on the books and records of the Partnership, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The powers, preferences and special rights and
limitations of the Series ___ Preferred Securities are established pursuant to,
and this certificate and the Series ___ Preferred Securities represented hereby
are issued and shall in all respects be subject to the terms and provisions of,
the Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of _______________, 1994 as the same may, from time to time, be amended
(the "Limited Partnership Agreement") authorizing the issuance of the Series ___
Preferred Securities and determining, together with the Action of the General
Partner as authorized under the Limited Partnership Agreement, the powers,
preferences, and other special rights and limitations, regarding Dividends,
voting, return of capital and otherwise, and other matters relating to the
Series ___ Preferred Securities. Capitalized terms used herein but not defined
shall have the meaning given them in the Limited Partnership Agreement. The
Preferred Security Holder is entitled to the benefits of the Payment and
Guarantee Agreement of The United Illuminating Company, a Connecticut
corporation, dated as of _______________, 1994 (the "Guarantee") and the ___%
Junior Subordinated Deferrable Interest Debentures, Series ___, Due
_______________ of The United Illuminating Company (the "Debentures") issued
pursuant to the Indenture dated as of _______________, 1994 between The United
Illuminating Company and _________________________, as Trustee, as such
<PAGE>
Indenture may be amended and supplemented from time to time, in each case to the
extent provided therein and in the Limited Partnership Agreement. The
Partnership will furnish a copy of the Limited Partnership Agreement, the
Guarantee and the Debentures to the Preferred Security Holder without charge
upon written request to the Partnership at its principal place of business or
registered office.
The Preferred Security Holder, by accepting this certificate, is deemed to
have agreed that the Debentures and the Guarantee are subordinate and junior in
right of payment to all Senior Indebtedness of The United Illuminating Company
as and to the extent provided in the Indenture and the Guarantee. Upon receipt
of this certificate, the Preferred Security Holder is admitted to the
Partnership as a Limited Partner, is bound by the Limited Partnership Agreement
and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Partnership has executed this certificate this
_____ day of _______________ 199__.
UNITED CAPITAL L.P.
By: The United Illuminating Company, its
General Partner
By
----------------------------------------
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<PAGE>
EXHIBIT 4.(d)
ACTION OF GENERAL PARTNER
THE UNITED ILLUMINATING COMPANY, a Connecticut corporation ("United
Illuminating"), as General Partner of UNITED CAPITAL FUNDING PARTNERSHIP L.P., a
Delaware limited partnership (the "Partnership"), in accordance with Section
10.2(a) of the Amended and Restated Agreement of Limited Partnership of the
Partnership dated as of _______________, 1994, as it may heretofore have been
amended (the "Partnership Agreement," capitalized terms used herein without
definition having the meanings specified in the Partnership Agreement), does
hereby establish a new series of Preferred Securities having the following
designation, rights, privileges, restrictions and other terms and provisions
(the numbered clauses set forth below corresponding to the subsections of
Section 10.2(a) of the Partnership Agreement):
(i)-(ii) Designation and Number. __________ Preferred Securities of
----------------------
the Partnership with an aggregate liquidation preference of $__________ million
($__,000,000) and a liquidation preference of $25 per Preferred Security, are
hereby designated as "___% Preferred Capital Securities, Series ___"
(hereinafter called the "Series ___ Preferred Securities"). The LP Certificates
evidencing the Series ___ Preferred Securities shall be substantially in the
form attached hereto as Exhibit A. The proceeds of the Series ___ Preferred
Securities shall be loaned to United Illuminating in return for ___% Junior
Subordinated Deferrable Interest Debentures, Series ___ Due 20 of United
Illuminating in aggregate principal amount equal to the aggregate liquidation
preference of the Series ___ Preferred Securities, bearing interest at an annual
rate equal to the annual dividend rate on the Series ___ Preferred Securities
and having certain payment and redemption provisions which correspond to the
payment and redemption provisions of the Series ___ Preferred Securities (the
"Series _ Debentures").
(iii)-(iv) Dividends. (a) The Limited Partners who hold the Series ___
---------
Preferred Securities shall be entitled to receive, to the extent set forth in
paragraph (b), cumulative preferential cash Dividends at the annual rate of ___
% of the liquidation preference of $25 per Preferred Security per annum,
calculated for any full monthly dividend period on the basis of a 360-day year
consisting of 12 months of 30 days each and, for any period shorter than a full
monthly dividend period, Dividends will be computed on the basis of the actual
number of days elapsed in such period. Dividends will be payable in United
States dollars monthly in arrears on the last day of each calendar month of each
year, commencing, _______________, 199__. Such Dividends will accumulate
whether or not there are profits, surplus or other funds of the Partnership
legally available to the Partnership for the payment of Dividends. Dividends on
the Series ___ Preferred Securities shall be cumulative from the date of
original issue, and the cumulative portion from such date to __________, 199__
shall be payable on __________, 199__. Accrued and unpaid Dividends on the
Series A Preferred Securities shall accrue additional Dividends in respect
thereof after the scheduled Dividend payment date therefor at the Dividend rate
per annum applicable to the Series A Preferred Securities. In the event that
any date on which Dividends are payable on the Series ___ Preferred Securities
is not a Business Day (as defined below), then payment of the Dividends payable
on such date will be made on the next succeeding day which is a Business Day
(and without any additional dividends or other payment in respect of any such
delay), except that, if such Business Day is in the next succeeding calendar
year, such payment shall
<PAGE>
be made on the immediately preceding Business Day, in each case with the same
force and effect, and in the same amount, as if made on such date. A "Business
Day" shall mean any day other than a day on which banking institutions in The
City of New York or the City of New Haven are authorized or required by law to
close.
(b) Dividends on the Series ___ Preferred Securities shall be paid to
the extent that, on any scheduled Dividend payment date, the Partnership has (x)
funds legally available for the payment of such Dividends, as determined by the
General Partner, and (y) cash on hand sufficient to permit such payment.
Dividends on the Series ___ Preferred Securities will be payable to the Holders
thereof as they appear on the books and records of the Partnership on the
relevant record dates. Such record dates shall be one Business Day prior to the
relevant payment dates; provided, however, that if the Series ___ Preferred
Securities are not held by a securities depositary, the General Partner shall
have the right to change such record dates.
(c) The Partnership shall not:
(i) pay, or set aside for payment, any Dividends on any other
Preferred Securities ranking pari passu with the Series ___ Preferred Securities
as regards participation in the profits of the Partnership ("Dividend Parity
Securities"), unless, at the time of such payment or setting aside, there shall
also be paid, or set aside for payment, as the case may be, Dividends on the
Series ___ Preferred Securities on a pro rata basis, so that after giving effect
to the payment of all such Dividends,
(x) the ratio of (a) the aggregate amount of Dividends paid on the
Series ___ Preferred Securities to (b) the aggregate amount of
Dividends paid on such Dividend Parity Securities is the same as
(y) the ratio of (a) the aggregate of all accumulated arrears of
unpaid Dividends and accrued and unpaid Additional Amounts, if any, in
respect of the Series ___ Preferred Securities to (b) the aggregate of
all accumulated arrears of unpaid Dividends and accrued and unpaid
Additional Amounts, if any, in respect of such Dividend Parity
Securities;
(ii) pay, or set aside for payment, any Dividends or other
distributions on the General Partner Interests or any other securities of the
Partnership ranking junior to the Series ___ Preferred Securities as to
Dividends (collectively, the "Dividend Junior Securities"); or
(iii) redeem, purchase or otherwise acquire any Series ___ Preferred
Securities, any Dividend Parity Securities or any Dividend Junior Securities;
until, in each case, such time as all accumulated and unpaid Dividends and
accrued and unpaid Additional Amounts, if any, on the Series ___ Preferred
Securities shall have been paid in full for all Dividend periods terminating on
or prior to, in the case of clauses (i) and (ii), such payment and, in the case
of clause (iii), the date of such redemption, purchase or acquisition.
-2-
<PAGE>
(v) Liquidation Distribution. In the event of any voluntary or involuntary
------------------------
dissolution, liquidation or winding up of the Partnership, Preferred Security
Holders who hold the Series ___ Preferred Securities at the time outstanding
will be entitled to receive out of the assets of the Partnership available for
distribution to Partners after satisfaction of liabilities to creditors, if any,
as required by the Act, before any distribution of assets is made to the General
Partner or any other series of Preferred Securities ranking junior to the Series
___ Preferred Securities with respect to participation in the assets of the
Partnership, but together with the holders of every other series of Preferred
Securities outstanding, if any, ranking pari passu with the Series ___ Preferred
Securities with respect to participation in the assets of the Partnership
("Liquidation Parity Securities"), an amount equal to the aggregate of the
liquidation preference of $25 per Series ___ Preferred Security plus an amount
equal to all accumulated and unpaid Dividends and any accrued and unpaid
Additional Amounts thereon to the date of payment (the "Liquidation
Distribution"). If, upon any such liquidation, the Liquidation Distribution can
be paid only in part because the Partnership has insufficient assets available
to pay in full the aggregate Liquidation Distribution and the aggregate maximum
liquidation distributions on the Liquidation Parity Securities, then the amounts
payable directly by the Partnership on the Series ___ Preferred Securities and
on such Liquidation Parity Securities shall be paid on a pro rata basis, so that
(i) the ratio of (x) the aggregate amount paid in respect of the
Liquidation Distribution to (y) the aggregate amount paid in respect of
liquidation distributions on the Liquidation Parity Securities is the same
as
(ii) the ratio of (x) the aggregate Liquidation Distribution to (y)
the aggregate maximum liquidation distributions on the Liquidation Parity
Securities.
(vi)-(vii) Redemption. (a) The Series ___ Preferred Securities shall be
----------
redeemable, at the option of the Partnership and at the direction of United
Illuminating, in whole or in part from time to time, on or after
_______________, 199__ at a redemption price of $25 per Series ___ Preferred
Security plus an amount equal to accumulated and unpaid Dividends and any
accrued and unpaid Additional Amounts thereon to the date fixed for redemption
(the "Redemption Price"); provided, however, that prior to giving any such
notice of redemption, the Partnership shall have received from United
Illuminating a notice of redemption of Series ___ Debentures in an aggregate
principal amount equal to the aggregate liquidation preference of the Series ___
Preferred Securities to be redeemed. If a partial redemption would result in a
delisting of the Series ___ Preferred Securities by any national securities
exchange or other organization on which the Series ___ Preferred Securities are
then listed, the Partnership may only redeem the Series ___ Preferred Securities
in whole.
(b) If at any time after the issuance of the Series A Preferred Securities,
the Partnership is or would be required to pay or would be required to pay
Additional Amounts or United Illuminating is or would be required to withhold or
deduct certain amounts pursuant to paragraph (xii) below, then the Partnership
may, at its option, redeem the Series A Preferred Securities in whole or, if
such requirement relates only to certain of the Series A Preferred Securities,
the Series A Preferred Securities subject to such requirement, in each case at
the Redemption Price.
-3-
<PAGE>
(c) If at any time United Illuminating (1) pays at maturity or (2) redeems
Series ___ Debentures, the proceeds from such payment or redemption of principal
on such Debentures shall be applied to redeem Series ___ Preferred Securities at
the Redemption Price.
(d) If a Special Event (as defined below) shall occur and be continuing,
the General Partner shall (1) cause the Partnership to redeem the Series ___
Preferred Securities in whole (and not in part) at the Redemption Price, within
90 days following the occurrence of such Special Event, or (2) cause the
Partnership to distribute to Holders of Series ___ Preferred Securities in
exchange for such Holders' Series ___ Preferred Securities, within 90 days
following the occurrence of such Special Event, the Series ___ Debentures;
provided, however, that in the case of clause (2) above the Partnership shall
have received an opinion of nationally recognized independent counsel
experienced in such matters to the effect that such Holders will not recognize
any gain or loss for Federal income tax purposes as a result of such
distribution; provided further, however, that if the Special Event is solely a
Tax Event (as defined below), neither United Illuminating nor the Partnership
shall be required to elect either of the options described in clause (1) or (2)
above, and United Illuminating and the Partnership may, instead, allow the
Series ___ Preferred Securities to remain outstanding. For purposes of this
Action, "Special Event" shall mean a Tax Event or an Investment Company Event.
"Investment Company Event" shall mean the occurrence of a change in law or
regulation or a written change in official interpretation of law or regulation
by any legislative body, court, governmental agency or regulatory authority (a
"1940 Act Change in Law") to the effect that the Partnership is or will be
considered an "investment company" required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), which 1940 Act
Change in Law becomes effective on or after _______________, 199_; provided that
no Investment Company Event shall be deemed to have occurred if United
Illuminating or the Partnership shall have obtained a written opinion of
nationally recognized independent counsel to the Partnership experienced in
practice under the 1940 Act, to the effect that United Illuminating or the
Partnership has successfully taken either of the steps set forth in clause (a)
or (b) below to avoid such 1940 Act Change in Law so that in the opinion of such
counsel, notwithstanding such 1940 Act Change in Law, the Partnership is not
required to be registered as an "investment company" within the meaning of the
1940 Act. Such steps shall be either (a) issuing an additional or supplemental
irrevocable and unconditional guarantee (i) of accumulated and unpaid Dividends
and any accrued and unpaid Additional Amounts (whether or not moneys are legally
available therefor) on the Series ___ Preferred Securities and (ii) upon a
liquidation of the Partnership, of the full amount of the Liquidation
Distribution on the Series ___ Preferred Securities (regardless of the amount of
assets of the Partnership otherwise available for distribution in such
liquidation), or (b) the use of any other measures that do not adversely affect
Holders of Series ___ Preferred Securities. "Tax Event" shall mean that United
Illuminating or the Partnership shall have obtained an opinion of nationally
recognized independent tax counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision or taxing authority thereof or therein
affecting taxation, or any amendment to or change in an official interpretation
or application of such laws or regulations, which amendment or change is
effective on or after _______________, 199_, and which change cannot be avoided
-4-
<PAGE>
by the use of any reasonable measures available to United Illuminating or the
Partnership, there is a substantial increase in risk that (i) the Partnership is
subject to Federal income tax with respect to interest received on the Series
___ Debentures, (ii) interest payable on the Series ___ Debentures is not
deductible for Federal income tax purposes or (iii) the Partnership is subject
to more than a de minimis amount of other taxes, duties or other governmental
charges.
(e) The Series ___ Preferred Securities will be subject to redemption or
purchase by operation of a sinking or purchase fund.
(f) (1) Notice of any redemption (a "Notice of Redemption") of, or notice
of distribution of Series ___ Debentures in exchange for, the Series ___
Preferred Securities will be given by the Partnership by mail to each Holder of
Series ___ Preferred Securities to be redeemed or exchanged not fewer than 30
nor more than 60 days prior to the date fixed for redemption or exchange
thereof; provided, that no such notice shall be required in the case of a
redemption of Series ___ Preferred Securities resulting from payment at maturity
of the Series ___ Debentures as contemplated in paragraph (vi) - (vii) (c)(1)
above, the redemption date for the Series ___ Preferred Securities being the
same as such maturity date in such case. For purposes of the calculation of the
date of redemption or exchange and the dates on which notices are given pursuant
to this paragraph (f)(1), a Notice of Redemption or notice of distribution shall
be deemed to be given on the day such notice is first mailed by first-class
mail, postage prepaid, to Preferred Security Holders who hold Series ___
Preferred Securities. Each Notice of Redemption or notice of distribution shall
be addressed to the Preferred Security Holders who hold Series ___ Preferred
Securities at the address of each such Holder appearing in the books and records
of the Partnership. No defect in the Notice of Redemption or notice of
distribution or in the mailing of either thereof with respect to any Holder
shall affect the validity of the redemption or exchange proceedings with respect
to any other Holder.
(2) In the event that fewer than all the outstanding Series ___ Preferred
Securities are to be redeemed, the Series ___ Preferred Securities to be
redeemed will be selected in accordance with paragraph (4) below or, in the
event that Series ___ Preferred Securities are not held by the Depository, by
lot or in such other manner as the General Partner shall deem fair or
appropriate.
(3) If (a) the Partnership gives a Notice of Redemption in respect of
Series ___ Preferred Securities (which notice shall be irrevocable) or (b)
Series ___ Preferred Securities shall become redeemable by virtue of the
maturity of Series ___ Debentures as contemplated in paragraph (c)(1) above,
then on the date fixed for redemption, the Partnership will pay the Redemption
Price to the Holders of Series ___ Preferred Securities. If Notice of Redemption
shall have been given and payment or provision for payment shall have been made
on the date fixed for redemption as required, then upon such date, all rights of
the Preferred Security Holders who hold such Series ___ Preferred Securities so
called for redemption will cease, except the right of the Holders of such
Preferred Securities to receive the Redemption Price, but without interest.
Neither the General Partner nor the Partnership shall be required to register or
cause to be registered the transfer of any Series ___ Preferred Securities which
have been so called for redemption. In the event that any
-5-
<PAGE>
date fixed for redemption of Series ___ Preferred Securities is not a Business
Day, payment of the Redemption Price payable on such date will be made on the
next succeeding day which is a Business Day (and without any additional
dividends or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day. In the event that payment of the Redemption
Price in respect of Series ___ Preferred Securities is not paid either by the
Partnership or by United Illuminating pursuant to the Guarantee, Dividends on
such Series ___ Preferred Securities will continue to accumulate (but without
any additional dividends on amounts so accumulating), from the original date
fixed for redemption to the date of payment, in which case the actual payment
date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(4) Redemption or exchange notices shall be sent to the Depository or its
nominee. If less than all of the Series ___ Preferred Securities are being
redeemed, interests to be redeemed shall be determined in accordance with the
Depository's practice which at the date hereof is to determine by lot the amount
of the interest of each direct participant in such series to be redeemed.
(viii) Conversion or Exchange. Under the circumstances described in
----------------------
paragraph (vi)-(vii)(d)(2) above and as of the date fixed for distribution of
Series ___ Debentures, any LP Certificates representing Series ___ Preferred
Securities outstanding shall bc deemed to represent the Series ___ Debentures to
be distributed on such an exchange, and the Series ___ Preferred Securities will
no longer be deemed outstanding and may be cancelled by the General Partner.
Under such circumstances, the General Partner may dissolve the Partnership if
there are no other Preferred Securities outstanding. The Series ___ Debentures
distributed upon such an exchange shall have an aggregate principal amount equal
to the aggregate liquidation preference of $25 per security on the Series ___
Preferred Securities so exchanged, and shall bear interest at a rate per annum
equal to the annual Dividend rate on such Series ___ Preferred Securities from
the last date on which Dividends on such Series ___ Preferred Securities were
paid.
(ix) Voting Rights. If (i) the Partnership fails to pay Dividends and any
-------------
accrued and unpaid Additional Amounts in full on the Series ___ Preferred
Securities for any period of 18 consecutive months; (ii) an Event of Default (as
defined with respect to the Series ___ Debentures) under the Indenture shall
have occurred and be continuing; or (iii) United Illuminating is in default on
any of its payment or other obligations under the Guarantee, then the Holders of
Series ___ Preferred Securities, together with the holders of any other series
of Preferred Securities having the right to vote for the appointment of a
Special Representative in such event, acting as a single class, shall be
entitled, by vote of holders of a majority in aggregate liquidation preference
of all Preferred Securities having the right to vote, to appoint and authorize a
Special Representative to enforce the Partnership's rights under the Series ___
Debentures (and, if applicable, such other Debentures) and the Indenture against
United Illuminating, enforce the obligations undertaken by United Illuminating
under the Guarantee and pay Dividends on the Series ___ Preferred Securities (to
the extent the Partnership has funds legally available for the payment of such
dividends and cash on hand sufficient to permit such payment). Any Special
Representative so appointed shall not be admitted as a Partner in the
Partnership or otherwise be deemed to
-6-
<PAGE>
be a Partner in the Partnership and shall have no liability for the debts,
obligations or liabilities of the Partnership, except to the extent otherwise
required in order for such Special Representative to enforce the Partnership's
rights under the Series __ Debentures and fulfill its other duties under the
Partnership Agreement.
In furtherance of the foregoing, and without limiting the powers of any
special representative so appointed and for the avoidance of any doubt
concerning the powers of the Special Representative, any Special Representative,
in its own name and as representative of the Partnership, may institute a
proceeding, including, without limitation, any suit in equity, an action at law
or other judicial or administrative proceeding, to enforce the Partnership's
rights directly against United Illuminating or any other obligor in connection
with such obligations to the same extent as the Partnership and on behalf of the
Partnership, and may prosecute such proceeding to judgment or final decree, and
enforce the same against United Illuminating, or any other obligor in connection
with such obligations.
For purposes of determining whether the Partnership has failed to pay
Dividends in full for 18 consecutive months, Dividends shall be deemed to remain
in arrears, notwithstanding any payments in respect thereof, until full
cumulative Dividends and any accrued and unpaid Additional Amounts have been or
contemporaneously are set aside and paid with respect to all monthly Dividend
periods terminating on or prior to the date of payment of such full cumulative
Dividends and Additional Amounts. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
general meeting for the above purpose. If the General Partner fails to convene
such meeting within such 30-day period, the Holders of 10% in aggregate
liquidation preference of the outstanding Series ___ Preferred Securities will
be entitled to convene such meeting. The provisions of Section 7.2 of the
Partnership Agreement relating to the convening and conduct of meetings of
Partners will apply with respect to any such meeting. Any Special Representative
so appointed shall vacate office immediately if the Partnership (or United
Illuminating pursuant to the Guarantee) shall have paid in full all accumulated
and unpaid Dividends and any accrued and unpaid Additional Amounts on the Series
___ Preferred Securities or such Event of Default or default under the Guarantee
by United Illuminating, as the case may be, shall have been cured.
If any proposed amendment to the Partnership Agreement provides for, or the
General Partner otherwise proposes to effect (pursuant to an Action or
otherwise), (x) any action which would adversely affect the rights, preferences
and privileges of the holders of the Series ___ Preferred Securities, whether by
way of amendment of the Partnership Agreement or otherwise (including, without
limitation, the authorization or issuance of any Interests ranking, as to
participation in the profits or assets of the Partnership, senior to the Series
___ Preferred Securities or the authorization to dissolve, liquidate or wind up
the Partnership), or (y) the dissolution, liquidation or winding up of the
Partnership (other than in connection with a distribution of Series ___
Debentures and dissolution of the Partnership after the occurrence of a Special
Event), then Limited Partners who hold the outstanding Series ___ Preferred
Securities will be entitled to vote on such amendment or proposed action of the
General Partner (but not on any other amendment or action) together as a class
with, in the case of an amendment or proposed action described in clause (x)
above which would equally adversely affect the rights, preferences or privileges
of holders of any Dividend Parity Securities or any Liquidation Parity
Securities, holders of such Dividend
-7-
<PAGE>
Parity Securities or such Liquidation Parity Securities, as the case may be, or,
in the case of any amendment described in clause (y) above, holders of all
Liquidation Parity Securities, and such amendment or action shall not be
effective except with the approval of Limited Partners holding 66-2/3% in
aggregate liquidation preference of such class; provided, however, that no such
approval shall be required if the dissolution, liquidation or winding up the
Partnership is proposed or initiated pursuant to Section 15.2 of the Partnership
Agreement, or upon the initiation of proceedings, or after proceedings have been
initiated, for the dissolution, liquidation or winding up of United
Illuminating.
The rights attached to the Series ___ Preferred Securities will be deemed
not to be adversely affected by the creation or issue of, and no vote will be
required for the creation of, any further Interests ranking junior to, or pari
passu with, the Series ___ Preferred Securities with regard to participation in
the profits or assets of the Partnership.
Any required approval of Holders of Series ___ Preferred Securities may be
given at a separate meeting of such Holders convened for such purpose, at a
general meeting of Preferred Security Holders or pursuant to written consent.
The Partnership will cause a notice of any meeting at which Holders of Series
___ Preferred Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed to each
Holder of Series ___ Preferred Securities. Each such notice will include a
statement setting forth (i) the date of such meeting or the date by which such
action is to be taken, (ii) a description of any matter on which such Holders
are entitled to vote or upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.
No vote or consent of Holders of Series ___ Preferred Securities will be
required for the Partnership to redeem and cancel Series ___ Preferred
Securities in accordance with the Partnership Agreement.
Notwithstanding that Holders of Series ___ Preferred Securities are
entitled to vote or consent under any of the circumstances described above,
holders of any of the Series ___ Preferred Securities and any other series of
Preferred Securities that are entitled to vote or consent with such Series ___
Preferred Securities as a class at such time that are owned by United
Illuminating or any Affiliate of United Illuminating shall not be entitled to
vote or consent and shall, for the purposes of such vote or consent, be treated
as if they were not outstanding.
(x) Ranking. So long as any Series ___ Preferred Securities are
-------
outstanding, the Partnership will not issue any Interests ranking, as to
participation in the profits or assets of the Partnership, senior to the Series
___ Preferred Securities.
(xi) See paragraph (i)-(ii) above for a description of the Series ___
Debentures.
(xii) Additional Amounts. All payments in respect of Preferred Securities
------------------
by the Partnership will be made without withholding or deduction for or on
account of any present or future taxes, duties, assessments or governmental
charges of whatever nature imposed or levied upon or as a result of such payment
by or on behalf of the United States, any state
-8-
<PAGE>
thereof or any other jurisdiction through which or from which such payment is
made, or any authority therein or thereof having power to tax, unless the
withholding or deduction of such taxes, duties, assessments or governmental
charges is required by law. In the event that any such withholding or deduction
is required as a consequence of (i) the Series A Debentures not being treated as
indebtedness for United States Federal income tax purposes or (ii) the
Partnership not being treated as a partnership for United States Federal income
tax purposes, the Partnership will pay as a dividend such additional amounts as
may be necessary in order that the net amounts received by the Holders after
such withholding or deduction will equal the amount that would have been
receivable in respect of the Preferred Securities in the absence of such
withholding or deduction, except that no such additional amounts will be payable
to a Holder (or a third party on such Holder's behalf) if:
a. such Holder is liable for such taxes, duties, assessments or
governmental charges in respect of the Preferred Securities by reason
of such Holder's having a connection with the United States, any state
thereof or any other jurisdiction through which or from which such
payment is made, or in which such Holder resides, conducts business or
has other contacts, other than being a Holder of Preferred Securities,
or
b. the Partnership or United Illuminating has notified such
Holder of the obligation to withhold or deduct taxes and requested but
not received from such Holder a declaration of non-residence, a valid
taxpayer identification number or other claim for exemption, and such
withholding or deduction would not have been required had such
declaration, taxpayer identification number or claim been received.
(xiii) Mergers. The General Partner is authorized and directed to conduct
-------
its affairs and to operate the Partnership in such a way that the Partnership
would not be deemed to be an "investment company" required to be registered
under the 1940 Act or taxed as a corporation for Federal income tax purposes and
so that the Series ___ Debentures will be treated as indebtedness of United
Illuminating for Federal income tax purposes. In this connection, the General
Partner is authorized to take any action not inconsistent with applicable law,
the Certificate or the Partnership Agreement and that does not adversely affect
the interests of Holders of Series ___ Preferred Securities that the General
Partner determines in its discretion to be necessary or desirable for such
purposes.
The Partnership shall not consolidate, amalgamate, merge with or into, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any partnership, corporation or other body,
except as described below. The General Partner may, without the consent of the
Holders of the Series ___ Preferred Securities, cause the Partnership to
consolidate, amalgamate, merge with or into, or be replaced by, or convey or
transfer its properties and assets substantially as an entirety to, a Delaware
limited partnership or "other business entity" (as defined in the Act, but not
including any general partnership) organized under the laws of any state of the
United States or the Turks and Caicos Islands or the Cayman Islands, provided
that (i) such successor entity either (x) expressly assumes all of the
obligations of the Partnership under the Series ___ Preferred Securities or (y)
substitutes for the Series ___ Preferred Securities other securities having
-9-
<PAGE>
substantially the same terms as the Series ___ Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank, with respect
to participation in the profits and assets of the successor entity, at least as
high as the Series ___ Preferred Securities rank, with respect to participation
in the profits and assets of the Partnership, (ii) United Illuminating expressly
acknowledges such successor entity as the holder of the Series ___ Debentures
and confirms its obligations under the Guarantee with respect to the Series ___
Preferred Securities, (iii) such merger, consolidation, amalgamation,
replacement, conveyance or transfer does not cause the Series ___ Preferred
Securities to be delisted by any national securities exchange or other
organization on which the Series ___ Preferred Securities are then listed unless
the Series ___ Preferred Securities are promptly relisted, or the Successor
Securities are promptly listed, by such exchange or other organization, (iv)
such merger, consolidation, amalgamation, replacement, conveyance or transfer
does not cause the Series ___ Preferred Securities to be downgraded or the
Successor Securities to be rated lower than the Series ___ Preferred Securities
immediately prior to such merger, consolidation, amalgamation, replacement,
conveyance or transfer by any "nationally recognized statistical rating
organization," as that term is defined by the Securities and Exchange Commission
for purposes of Rule 436(g)(2) under the Securities Act, (v) such merger,
consolidation, amalgamation, replacement, conveyance or transfer does not
adversely affect the powers, preferences and other special rights of Holders of
Series ___ Preferred Securities, (vi) such successor entity has a purpose
substantially identical to that of the Partnership and (vii) prior to such
merger, consolidation, amalgamation, replacement, conveyance or transfer, the
General Partner has received an opinion of nationally recognized independent
counsel to the Partnership experienced in such matters to the effect that (w)
Holders of outstanding Series ___ Preferred Securities will not recognize any
gain or loss for Federal income tax purposes as a result of the merger,
consolidation, amalgamation, replacement, conveyance or transfer, (x) such
successor entity will be treated as a partnership for Federal income tax
purposes, (y) following such merger, consolidation, amalgamation, replacement,
conveyance or transfer, United Illuminating and such successor entity will be in
compliance with the 1940 Act without registering thereunder as an investment
company, and (z) such merger, consolidation, amalgamation, replacement,
conveyance or transfer will not adversely affect the limited liability of
Holders of Series ___ Preferred Securities.
(xiv) Other Terms. The Bank of New York shall be the registrar and
-----------
co-transfer agent, and United Illuminating will act as co-transfer agent and
paying agent, for the Series __ Preferred Securities.
This written Action shall constitute an Action for purposes of the
Partnership Agreement.
-10-
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this Action of General
Partner this _____ day of _______________, 1994.
GENERAL PARTNER:
THE UNITED ILLUMINATING COMPANY
By ___________________________________
Name:
Title:
-11-
<PAGE>
Exhibit A
<TABLE>
<CAPTION>
================================================================================
Certificate Number Number of Preferred Securities
- - - --------------------------------------------------------------------------------
<S> <C>
R-1
================================================================================
</TABLE>
CUSIP NO.
Certificate Evidencing Preferred Securities
of
United Capital Funding Partnership L.P.
___% Preferred Securities Capital, Series ___
(Liquidation Preference $25 per Security)
United Capital Funding Partnership L.P., a limited partnership formed under
the laws of the State of Delaware (the "Partnership"), hereby certifies that
(the "Preferred Security Holder") is the registered owner of _______________
(_____) preferred securities of the Partnership representing Interests in the
Partnership of a series designated the ___% Preferred Capital Securities, Series
___ (liquidation preference $25 per security) (the "Series ___ Preferred
Securities"). The Series ___ Preferred Securities are fully paid and
nonassessable Interests in the Partnership, as to which the limited partners of
the Partnership who hold the Series ___ Preferred Securities, in their
capacities as limited partners of the Partnership, will have no liability solely
by reason of being Preferred Security Holders in excess of their obligations to
make payments provided for in the Limited Partnership Agreement (as defined
below) and their share of the Partnership's assets and undistributed profits
(subject to the obligation of a Preferred Security Holder to repay any funds
wrongfully distributed to it). The Series ___ Preferred Securities are
transferable on the books and records of the Partnership, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The powers, preferences and special rights and
limitations of the Series ___ Preferred Securities are established pursuant to,
and this certificate and the Series ___ Preferred Securities represented hereby
are issued and shall in all respects be subject to the terms and provisions of,
the Amended and Restated Agreement of Limited Partnership of the Partnership
dated as of _______________, 1994, as the same may, from time to time, be
amended (the "Limited Partnership Agreement"), authorizing the issuance of the
Series ___ Preferred Securities and determining, together with teh Action of the
General Partner or authorized under the Limited Partnership Agreement, the
powers, preferences, and other special rights and limitations, regarding
Dividends, voting, return of capital and otherwise, and other matters relating
to the Series ___ Preferred Securities. Capitalized terms used herein but not
defined shall have the meaning given them in the Limited Partnership Agreement.
The Preferred Security Holder is entitled to the benefits of the Payment and
Guarantee Agreement of The United Illuminating Company, a Connecticut
corporation, dated as of _______________, 1994 (the "Guarantee"), and the ___%
Junior Subordinated Deferrable Interest Debentures,
<PAGE>
Series ___, due 20 of The United Illuminating Company (the "Debentures") issued
pursuant to the Indenture dated as of _______________, 1994 between The United
Illuminating Company and The Bank of New York, as Trustee, as such Indenture may
be amended and supplemented from time to time, in each case to the extent
provided therein and in the Limited Partnership Agreement. The Partnership will
furnish a copy of the Limited Partnership Agreement, the Guarantee and the
Debentures to the Preferred Security Holder without charge upon written request
to the Partnership at its principal place of business or registered office.
The Preferred Security Holder, by accepting this certificate, is deemed to
have agreed that the Debentures and the Guarantee are subordinate and junior in
right of payment to all Senior Indebtedness of The United Illuminating Company
as and to the extent provided in the Indenture and the Guarantee. Upon receipt
of this certificate, the Preferred Security Holder is admitted to the
Partnership as a Limited Partner, is bound by the Limited Partnership Agreement
and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, the Partnership has executed this certificate this
_____ day _______________, of 1994.
UNITED CAPITAL FUNDING
PARTNERSHIP L.P.
By: THE UNITED ILLUMINATING
COMPANY, ITS GENERAL PARTNER
By ___________________________________
-2-
<PAGE>
EXHIBIT 4(e)
================================================================================
THE UNITED ILLUMINATING COMPANY
TO
THE BANK OF NEW YORK,
Trustee
----------------------------
INDENTURE
Dated as of ___________, 1994
------------------
================================================================================
<PAGE>
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of __________________, 1994
Trust Indenture Act Section Indenture Section
<TABLE>
<CAPTION>
<S> <C> <C>
(S)310 (a)(1)................................................ 909
(a)(2)................................................ 909
(a)(3)................................................ Not Applicable
(a)(4)................................................ Not Applicable
(b)................................................... 908
................................................... 910
(S)311 (a)................................................... 913
(b)................................................... 913
(c)................................................... 913
(S)312 (a)................................................... 1001
(b)................................................... 1001
(c)................................................... 1001
(S)313 (a)................................................... 1002
(b)................................................... 1002
(c)................................................... 1002
(d)................................................... 1002
(S)314 (a)................................................... 1002
(a)(4)................................................ 606
(b)................................................... Not Applicable
(c)(1)................................................ 102
(c)(2)................................................ 102
(c)(3)................................................ Not Applicable
(d)................................................... Not Applicable
(e)................................................... 102
(S)315 (a)................................................... 901
................................................... 903
(b)................................................... 902
(c)................................................... 901
(d)................................................... 901
(e)................................................... 814
(S)316 (a)................................................... 1016
................................................... 1017
(a)(1)(A)............................................. 802
................................................... 812
(a)(1)(B)............................................. 813
(a)(2)................................................ Not Applicable
(b)................................................... 808
(S)317 (a)(1)................................................ 803
(a)(2)................................................ 804
(b)................................................... 603
(S)318 (a)................................................... 107
</TABLE>
i
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE ONE
Definitions and Other Provisions of General Application
SECTION 101. Definitions..............................................
Act................................................................
Affiliate..........................................................
Authenticating Agent...............................................
Authorized Executive Officer.......................................
Board of Directors.................................................
Board Resolution...................................................
Business Day.......................................................
Commission.........................................................
Company............................................................
Company Request or Company Order...................................
Corporate Trust Office.............................................
Corporation........................................................
Defaulted Interest.................................................
Dollar or $........................................................
Event of Default...................................................
Exchange Act.......................................................
Governmental Authority.............................................
Governmental Obligations...........................................
Holder.............................................................
Indenture..........................................................
Interest Payment Date..............................................
Maturity...........................................................
Officer's Certificate..............................................
Opinion of counsel.................................................
Outstanding........................................................
Paying Agent.......................................................
Person.............................................................
Place of Payment...................................................
Predecessor Security...............................................
Redemption Date....................................................
Redemption Price...................................................
Regular Record Date................................................
Responsible Officer................................................
Securities.........................................................
Security Register and Security Registrar...........................
Senior Indebtedness................................................
Special Record Date................................................
Stated Maturity....................................................
Trust Indenture Act................................................
Trustee............................................................
United States......................................................
SECTION 102. Compliance Certificates and Opinions.....................
ii
<PAGE>
SECTION 103. Form of Documents Delivered to Trustee...................
SECTION 104. Acts of Holders..........................................
SECTION 105. Notices, etc. to Trustee and Company.....................
SECTION 106. Notice to Holders of Securities; Waiver..................
SECTION 107. Conflict with Trust Indenture Act........................
SECTION 108. Effect of Headings and Table of Contents.................
SECTION 109. Successors and Assigns...................................
SECTION 110. Separability Clause......................................
SECTION 111. Benefits of Indenture....................................
SECTION 112. Governing Law............................................
SECTION 113. Legal Holidays...........................................
ARTICLE TWO
Security Forms
SECTION 201. Forms Generally..........................................
SECTION 202. Form of Trustee's Certificate of Authentication..........
ARTICLE THREE
The Securities
SECTION 301. Amount Unlimited; Issuable in Series.....................
SECTION 302. Denominations............................................
SECTION 303. Execution, Authentication, Delivery and Dating...........
SECTION 304. Temporary Securities.....................................
SECTION 305. Registration; Registration of Transfer and Exchange......
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.........
SECTION 307. Payment of Interest; Interest Rights Preserved...........
SECTION 308. Persons Deemed Owners....................................
SECTION 309. Cancellation by Security Registrar.......................
SECTION 310. Computation of Interest..................................
SECTION 311. Extension of Interest Payment Period.....................
SECTION 312. CUSIP Numbers............................................
ARTICLE FOUR
Redemption of Securities
SECTION 401. Applicability of Article.................................
SECTION 402. Election to Redeem; Notice to Trustee....................
SECTION 403. Selection of Securities to Be Redeemed...................
SECTION 404. Notice of Redemption.....................................
SECTION 405. Securities Payable on Redemption Date....................
SECTION 406. Securities Redeemed in Part..............................
iii
<PAGE>
ARTICLE FIVE
Sinking Fund
SECTION 501. Applicability of Article.................................
SECTION 502. Satisfaction of Sinking Fund Payments With Securities....
SECTION 503. Redemption of Securities for Sinking Fund................
ARTICLE SIX
Covenants
SECTION 601. Payment of Principal, Premium and Interest...............
SECTION 602. Maintenance of Office or Agency..........................
SECTION 603. Money for Securities Payments To Be Held in Trust........
SECTION 604. Corporate Existence......................................
SECTION 605. Maintenance of Properties................................
SECTION 606. Statements as to Compliance..............................
SECTION 607. Waiver of Certain Covenants..............................
SECTION 608. Restriction on Payments of Dividends.....................
SECTION 609. Payment for Consents.....................................
ARTICLE SEVEN
Satisfaction and Discharge
SECTION 701. Satisfaction and Discharge of Securities.................
SECTION 702. Satisfaction and Discharge of Indenture..................
SECTION 703. Application of Trust Money...............................
ARTICLE EIGHT
Events of Default; Remedies
SECTION 801. Events of Default........................................
SECTION 802. Acceleration of Maturity; Rescission and Annulment.......
SECTION 803. Collection of Indebtedness and Suits for Enforcement
by Trustee...............................................
SECTION 804. Trustee May File Proofs of Claim.........................
SECTION 805. Trustee May Enforce Claims Without Possession of
Securities...............................................
SECTION 806. Application of Money Collected...........................
SECTION 807. Limitation on Suits......................................
SECTION 808. Unconditional Right of Holders to Receive Principal,
Premium and Interest.....................................
SECTION 809. Restoration of Rights and Remedies.......................
SECTION 810. Right and Remedies Cumulative............................
SECTION 811. Delay or Omission Not Waiver.............................
SECTION 812. Control by Holders of Securities.........................
SECTION 813. Waiver of Past Defaults..................................
SECTION 814. Undertaking for costs....................................
iv
<PAGE>
SECTION 815. Waiver of Stay or Extension Laws.........................
ARTICLE NINE
The Trustee
SECTION 901. Certain Duties and Responsibilities......................
SECTION 902. Notice of Defaults.......................................
SECTION 903. Certain Rights of Trustee................................
SECTION 904. Not Responsible for Recitals or Issuance of Securities...
SECTION 905. May Hold Securities......................................
SECTION 906. Money Held in Trust......................................
SECTION 907. Compensation and Reimbursement...........................
SECTION 908. Disqualification; Conflicting Interests..................
SECTION 909. Corporate Trustee Required; Eligibility..................
SECTION 910. Resignation and Removal; Appointment of Successor........
SECTION 911. Acceptance of Appointment by Successor...................
SECTION 912. Merger, Conversion, Consolidation or Succession to
Business.................................................
SECTION 913. Preferential Collection of Claims Against Company........
SECTION 914. Appointment of Authenticating Agent......................
ARTICLE TEN
Holders' Lists and Reports by Trustee and Company
SECTION 1001. Lists of Holders........................................
SECTION 1002. Reports by Trustee and Company..........................
ARTICLE ELEVEN
Consolidation, Merger, Conveyance or Other Transfer
SECTION 1101. Company May Consolidate, etc., Only on Certain Terms....
SECTION 1102. Successor Corporation Substituted.......................
ARTICLE TWELVE
Supplemental Indentures
SECTION 1201. Supplemental Indentures without Consent of Holders......
SECTION 1202. Supplemental Indentures with Consent of Holders.........
SECTION 1203. Execution of Supplemental Indentures....................
SECTION 1204. Effect of Supplemental Indentures.......................
SECTION 1205. Conformity With Trust Indenture Act.....................
SECTION 1206. Reference in Securities to Supplemental Indentures......
SECTION 1207. Modification Without Supplemental Indenture.............
v
<PAGE>
ARTICLE THIRTEEN
Meetings of Holders; Action Without Meeting
SECTION 1301. Purposes for Which Meetings May be Called...............
SECTION 1302. Call, Notice and Place of Meetings......................
SECTION 1303. Persons Entitled to Vote at Meetings....................
SECTION 1304. Quorum; Action..........................................
SECTION 1305. Attendance at Meetings; Determination of Voting Rights;
Conduct and Adjournment of Meetings.....................
SECTION 1306. Counting Votes and Recording Action of Meetings.........
SECTION 1307. Action without Meeting..................................
ARTICLE FOURTEEN
Immunity of Incorporators,
Stockholders, Officers and Directors
SECTION 1401. Liability Solely Corporate..............................
ARTICLE FIFTEEN
Subordination of Securities
SECTION 1501. Securities Subordinate to Senior Indebtedness...........
SECTION 1502. Payment Over of Proceeds of Securities..................
SECTION 1503. Disputes with Holders of Certain Senior Indebtedness....
SECTION 1504. Subrogation.............................................
SECTION 1505. Obligation of the Company Unconditional.................
SECTION 1506. Priority of Senior Indebtedness Upon Maturity...........
SECTION 1507. Trustee as Holder of Senior Indebtedness; Preservation
of Trustee's Rights.....................................
SECTION 1508. Notice to Trustee to Effectuate Subordination...........
SECTION 1509. Modification, Extension, etc. of Senior Indebtedness....
SECTION 1510. Trustee Has No Fiduciary Duty to Holders of Senior
Indebtedness............................................
SECTION 1511. Paying Agents Other Than the Trustee....................
SECTION 1512. Rights of Holders of Senior Indebtedness Not Impaired...
SECTION 1513. Effect of Subordination Provisions; Termination.........
Testimonium...........................................................
Signature and Seals...................................................
Acknowledgements......................................................
vi
<PAGE>
INDENTURE, dated as of , 1994, between THE UNITED
ILLUMINATING COMPANY, a corporation duly organized and existing under the laws
of the State of Connecticut (herein called the "Company"), having its principal
office at 157 Church Street, New Haven, Connecticut 06506-0901, and THE BANK OF
NEW YORK, a New York banking corporation, having its principal corporate trust
office at 101 Barclay Street, New York, New York 10286, as Trustee (herein
called the "Trustee").
RECITAL OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured junior
subordinated debentures, notes or other evidences of indebtedness (herein called
the "Securities"), to be issued in one or more series as contemplated herein;
and all acts necessary to make this Indenture a valid agreement of the Company
have been performed
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, 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 have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) all terms used herein without definition which are defined in the
Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with respect
to any computation required or permitted hereunder shall mean such
accounting principles as are generally accepted in the United States at the
date of such computation or, at the election of the Company in any
particular case, at the date of the execution and delivery of this
Indenture; provided, however,
<PAGE>
that in determining generally accepted accounting principles applicable to
the Company, the Company shall, to the extent required, conform to any
order, rule or regulation of any administrative agency, regulatory
authority or other governmental body having jurisdiction over the Company;
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.
Certain terms, used principally in Article Nine, are defined in that
Article.
"Act", when used with respect to any Holder of a Security, has the
meaning specified in Section 104.
"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.
"Authenticating Agent" means any Person (other than the Company or any
Affiliate of the Company) authorized by the Trustee pursuant to Section 914 to
act on behalf of the Trustee to authenticate one or more series of Securities.
"Authorized Executive Officer" means the Chairman of the Board, the
President, any Vice President, the Treasurer, any Assistant Treasurer or any
other duly authorized officer of the Company.
"Board of Directors" means either the board of directors of the
Company or any committee thereof duly authorized to act in respect of matters
relating to this Indenture.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company 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 a Place of Payment or any
other particular location specified in the Securities or this Indenture, means
any day, other than a Saturday or Sunday, that is not a day on which banking
institutions or trust companies in such Place of Payment or other location are
generally
2
<PAGE>
authorized or required by law, regulation or executive order to remain closed,
except as may be otherwise specified as contemplated by Section 301.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted under the Exchange Act of 1934, or, if at any time
after the date of execution and delivery of this Indenture such Commission is
not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body, if any, performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by an Authorized Executive Officer and
delivered to the Trustee.
"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 of execution and delivery of this
Indenture is located at 101 Barclay Street, New York, New York 10286.
"corporation" means a corporation, association, company, joint stock
company or business trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollar" or "$" means a dollar or other equivalent unit in such coin
or currency of the United States as at the time shall be legal tender for the
payment of public and private debts.
"Event of Default" has the meaning specified in Section 801.
"Exchange Act" means, as of any time, the Securities Exchange Act of
1934, or successor statute, as in effect at such time.
"Governmental Authority" means the government of the United States or
of any State or Territory thereof or of the District of Columbia or of any
county, municipality or other political subdivision of any of the foregoing, or
any department, agency, authority or other instrumentality of any of the
foregoing.
"Government Obligations" means:
3
<PAGE>
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States
entitled to the benefit of the full faith and credit thereof and not
callable, redeemable or otherwise prepayable at the option of the issuer
thereof; and
(b) certificates, depositary receipts or other instruments that
evidence a direct ownership interest in obligations described in clause (a)
above or in any specific interest or principal payments due in respect
thereof; provided, however, that the custodian of such obligations or
specific interest or principal payments shall be a bank or trust company
(which may include the Trustee or any Paying Agent) subject to Federal or
state supervision or examination with a combined capital and surplus of at
least $50,000,000; and provided, further, that, except as may be otherwise
required by law, such custodian shall be obligated to pay to the holders of
such certificates, depositary receipts or other instruments the full amount
received by such custodian in respect of such obligations or specific
payments and shall not be permitted to make any deduction therefrom.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and delivered and
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.
"Interest Payment Date", when used with respect to any Security, means the
Stated Maturity of an installment of interest on such Security.
"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 provided in such Security or in this Indenture, whether at the Stated
Maturity, by declaration of acceleration, upon call for redemption or
otherwise.
"Officer's Certificate" means a certificate signed by an Authorized
Executive Officer and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company but who may not be an employee of the Company, or other counsel
acceptable to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except
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(a) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(b) Securities deemed to have been paid in accordance with Section
701; and
(c) Securities which have been paid pursuant to Section 306 or 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 and the Company that such Securities are held by a bona
fide purchaser or purchasers in whose hands such Securities are valid
obligations of the Company;
provided, however, that in determining whether or not the Holders of the
requisite principal amount of the Securities Outstanding under this Indenture,
or the Outstanding Securities of any series, have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or whether or not
a quorum is present at a meeting of Holders of Securities, Securities owned by
the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor (unless the Company, such Affiliate or such
obligor owns all Securities Outstanding under this Indenture, or all Outstanding
Securities of each such series, as the case may be, determined without regard to
this provision) shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver or
upon any such determination as to the presence of a quorum, only Securities that
the Trustee actually knows to be so owned shall be so disregarded; provided,
however, that Securities so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor; and provided, further, that,
in the case of any Security the principal of which is payable from time to time
without presentment or surrender, the principal amount of such Security that
shall be deemed to be Outstanding at any time for all purposes of this Indenture
shall be the original principal amount thereof less the aggregate amount of
principal thereof theretofore paid.
"Paying Agent" means any Person, including the Company, authorized by the
Company to pay the principal of or premium, if any, or interest, if any, on any
Securities on behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
trust or unincorporated organization or any Governmental
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Authority.
"Place of Payment", when used with respect to the Securities of any series,
means the place or places, specified as contemplated by Section 301, at which,
subject to Section 602, principal of and premium, if any, and interest, if any,
on the Securities of such series are payable.
"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 shall be deemed (to the extent
lawful) to evidence the same debt as the mutilated, destroyed, lost or stolen
Security.
"Redemption Date", when used with respect to any Security to be redeemed,
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.
"Regular Record Date" for the interest payable on any Interest Payment Date
on the Securities of any series means the date specified for that purpose as
contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means any
officer of the Trustee assigned by the Trustee to administer its corporate trust
matters.
"Securities" has the meaning stated in the first recital of this Indenture
and more particularly means any securities authenticated and delivered under
this Indenture.
"Security Register" and "Security Registrar" have the respective meanings
specified in Section 305.
"Senior Indebtedness" means all obligations (other than non-recourse
obligations and the indebtedness issued under this Indenture) of, or guaranteed
or assumed by, the Company for money borrowed from any Person not an Affiliate
of the Company, including both senior and subordinated indebtedness for borrowed
money (other than the Securities), for the payment of money relating to any
lease that is capitalized on the consolidated balance sheet of the Company and
its subsidiaries in accordance with generally accepted accounting principles as
in effect from time to time, or evidenced by bonds, debentures, notes or other
similar instruments, and in each case, amendments, renewals, extensions,
modifications and refundings of any such indebtedness or obligations, whether
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existing as of the date of this Indenture or subsequently incurred by the
Company.
"Special Record Date" for the payment of any Defaulted Interest on the
Securities of any series means a date fixed by the Trustee pursuant to Section
307.
"Stated Maturity", when used with respect to any obligation or any
installment of principal thereof or interest thereon, means the date on which
the principal of such obligation or such installment of principal or interest is
stated to be due and payable (without regard to any provisions for redemption,
prepayment, acceleration, purchase or extension).
"Trust Indenture Act" means, as of any time, the Trust Indenture Act of
1939, or any successor statute, as in effect at such time.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this Indenture until a successor Trustee shall have become such with respect to
one or more series of Securities pursuant to the applicable provisions of this
Indenture, and thereafter "Trustee" shall mean or include each Person who is
then a Trustee hereunder, and if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series shall means the
Trustee with respect to Securities of that series.
"United States" means the United States of America, its territories, its
possessions and other areas subject to its political jurisdiction.
SECTION 102. Compliance Certificates and Opinions.
Except as otherwise expressly provided in this Indenture, upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall, if requested by the Trustee,
furnish to the Trustee an Officer's Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
opinion of such counsel all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents 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 shall include:
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(a) a statement that each Person signing such certificate or opinion has
read such covenant or condition and the definitions herein relating
thereto;
(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 Person, such Person has
made such examination or investigation as is necessary to enable such
Person to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of each such Person, 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 with respect 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 the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such Officer's Certificate or opinion is
based are erroneous. Any such certificate or Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect 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.
Whenever, subsequent to the receipt by the Trustee of any Board Resolution,
Officer's Certificate, Opinion of Counsel or other document or instrument, a
clerical, typographical or other
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inadvertent or unintentional error or omission shall be discovered therein, a
new document or instrument may be substituted therefor in corrected form with
the same force and effect as if originally filed in the corrected form and,
irrespective of the date or dates of the actual execution and/or delivery
thereof, such substitute document or instrument shall be deemed to have been
executed and/or delivered as of the date or dates required with respect to the
document or instrument for which it is substituted. Anything in this Indenture
to the contrary notwithstanding, if any such corrective document or instrument
indicates that action has been taken by or at the request of the Company that
could not have been taken had the original document or instrument not contained
such error or omission, the action so taken shall not be invalidated or
otherwise rendered ineffective but shall be and remain in full force and effect,
except to the extent that such action was a result of willful misconduct or bad
faith. Without limiting the generality of the foregoing, any Securities issued
under the authority of such defective document or instrument shall nevertheless
be the valid obligations of the Company entitled to the benefits of this
Indenture equally and ratably with all other Outstanding Securities, except as
aforesaid.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent,
election, waiver or other action provided by this Indenture to be made,
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person
or by an agent duly appointed in writing or, alternatively, may be embodied
in and evidenced by the record of Holders voting in favor thereof, either
in person or by proxies duly appointed in writing, at any meeting of
Holders duly called and held in accordance with the provisions of Article
Thirteen, 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 the Company. Such
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 and 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 and
(subject to Section 901) conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section. The record of any
meeting of Holders shall be proved in the manner provided in Section 1306.
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(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, or may be
proved in any other manner that the Trustee and the Company deem
sufficient. Where such execution is by a signer acting in a capacity other
than such signer's individual capacity, such certificate or affidavit shall
also constitute sufficient proof of his authority.
(c) The principal amount and serial numbers of Securities held by any
Person, and the date of holding the same, shall be proved by the Security
Register.
(d) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of a Holder 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
or the Company in reliance thereon, whether or not notation of such action
is made upon such Security.
(e) Until such time as written instruments shall have been delivered to the
Trustee with respect to the requisite percentage of principal amount of
Securities for the action contemplated by such instruments, any such
instrument executed and delivered by or on behalf of a Holder may be
revoked with respect to any or all of such Securities by written notice by
such Holder or any subsequent Holder, proven in the manner in which such
instrument was proven.
(f) Securities of any series authenticated and delivered after any Act of
Holders may, and shall, if required by the Trustee, bear a notation in form
approved by the Trustee as to any action taken by such Act of Holders. If
the Company shall so determine, new Securities of any series so modified as
to conform, in the opinion of the Trustee and the Company, to such action
may be prepared and executed by the Company and authenticated and delivered
by the Trustee in exchange for Outstanding Securities of such series.
(g) If the Company shall solicit from Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company
may, at its option, 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 the Company shall have no
obligation to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent,
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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 the record date shall be
deemed to be Holders for the purposes of determining whether Holders of the
requisite proportion of the Outstanding Securities have authorized or
agreed or consented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose the Outstanding
Securities shall be computed as of the record date.
SECTION 105. Notices, etc. to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, election,
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, the Trustee by
any Holder or by the Company, or the Company by the Trustee or by any Holder,
shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and delivered personally to an officer or
other responsible employee of the addressee, or transmitted by facsimile
transmission, telex or other direct written electronic means to such telephone
number or other electronic communications address as the parties hereto shall
from time to time designate, or transmitted by registered mail, charges prepaid,
to the applicable address set opposite such party's name below or to such other
address as either party hereto may from time to time designate:
If to the Trustee, to:
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telephone: (212) 815-5736
Telecopy: (212) 815-5915
If to the Company, to:
The United Illuminating Company
157 Church Street
P.O. Box 1564
New Haven, Connecticut 06506-0901
Attention: Treasurer
Telephone: (203) 499-2408
Telecopy: (203) 499-2414
Any communication contemplated herein shall be deemed to have been made, given,
furnished and filed if personally delivered, on the date of delivery, if
transmitted by facsimile transmission, telex
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or other direct written electronic means, on the date of transmission, and if
transmitted by registered mail, on the date of receipt.
SECTION 106. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given, and shall be deemed given, to Holders if in writing and mailed, first-
class postage prepaid, to each Holder affected by such event, at the address of
such Holder as it appears in the Security Register, not later than the latest
date, if any, and not earlier than the earliest date, if any, prescribed for the
giving of such notice.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice to Holders by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder. In any
case where notice to Holders 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.
Any notice required by this Indenture may be waived in writing by the
Person entitled to receive such notice, either before or after the event
otherwise to be specified therein, 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. Conflict with Trust Indenture Act.
If any provision of this Indenture limits, qualifies or conflicts with
another provision hereof that is required or deemed to be included in this
Indenture by, or is otherwise governed by, any of the provisions of the Trust
Indenture Act, such other provision shall control; and if any provision hereof
otherwise conflicts with the Trust Indenture Act, the Trust Indenture Act shall
control.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings in this Indenture, the reconciliation and
tie between the Trust Indenture Act and this Indenture, and the Table of
Contents are for convenience only and shall not affect the construction hereof
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SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall bind
its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or the Securities 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 111. Benefits of Indenture.
Nothing in this Indenture or the Securities, express or implied, shall give
to any Person, other than the parties hereto, their successors hereunder, the
Holders and, so long as the notice described in Section 1508 hereof has not been
given, the holders of Senior Indebtedness, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts
of laws principles thereof, except to the extent that the law of any other
jurisdiction shall be mandatorily applicable.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the Securities
other than a provision in Securities of any series, or in the Board Resolution
or Officer's Certificate that establishes the terms of the Securities of such
series, that specifically states that such provision shall apply in lieu of this
Section) payment of interest 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, and in
the same amount, as if made on the Interest Payment Date or Redemption Date, or
at the Stated Maturity, and, if such payment is made or duly provided for on
such Business Day, no interest shall accrue on the amount so payable for the
period from and after such Interest Payment Date, Redemption Date or Stated
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Maturity, as the case may be, to such Business Day.
ARTICLE TWO
Security Forms
SECTION 201. Forms Generally.
The definitive Securities of each series shall be in substantially the form
or forms thereof established in the supplemental indenture, Board Resolution or
Officer's Certificate (or any combination thereof) establishing such series, in
each case with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. If the form or forms of Securities of any series are established in
a Board Resolution or in an Officer's Certificate pursuant to a Board
Resolution, such Board Resolution and Officer's Certificate, if any, shall be
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities.
The Securities of each series shall be issuable in registered form without
coupons. The definitive Securities shall be produced in such manner as shall be
determined by the officers executing such Securities, as evidenced by their
execution thereof.
SECTION 202. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in substantially the
form set forth below.
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By:
Authorized Signatory
ARTICLE THREE
The Securities
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities that may be
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authenticated and delivered under this Indenture is unlimited. The Securities
may be issued in one or more series. Prior to the authentication and delivery of
Securities of any series, there shall be established by specification in a
supplemental indenture, a Board Resolution or an Officer's Certificate (or any
combination thereof):
(a) the title of the Securities of such series (which shall distinguish the
Securities of such series from Securities of all other series);
(b) any limit upon the aggregate principal amount of the Securities of such
series that may be authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of such series
pursuant to Section 304, 305, 306, 406 or 1206 and, except for any
Securities that, pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(c) the Person or Persons (without specific identification) to whom
interest on Securities of such series shall be payable on any Interest
Payment Date, if other than the Persons in whose names such Securities (or
one or more Predecessor Securities) are registered at the close of business
on the Regular Record Date for such interest;
(d) the date or dates on which the principal of the Securities of such
series is payable or any formula or other method or other means by which
such date or dates shall be determined, by reference or otherwise (without
regard to any provisions for redemption, prepayment, acceleration, purchase
or extension);
(e) the rate or rates at which the Securities of such series shall bear
interest, if any (including the rate or rates at which overdue principal
shall bear interest, if different from the rate or rates at which such
Securities shall bear interest prior to Maturity, and, if applicable, the
rate or rates at which overdue premium or interest shall bear interest, if
any), or any formula or other method or other means by which such rate or
rates shall be determined, by reference or otherwise; the date or dates
from which such interest shall accrue; the Interest Payment Dates on which
such interest shall be payable and the Regular Record Date, if any, for the
interest payable on such Securities on any Interest Payment Date; and the
basis of computation of interest, if other than as provided in Section 310;
(f) the place or places at which (1) the principal of and premium, if any,
and interest, if any, on Securities of such
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series shall be payable, (2) registration of transfer of Securities of such
series may be effected, (3) exchanges of Securities of such series may be
effected and (4) notices and demands to or upon the Company in respect of
the Securities of such series and this Indenture may be served; the
Security Registrar for such series; and if such is the case, that the
principal of such Securities shall be payable without presentation or
surrender thereof;
(g) the period or periods within which, or the date or dates on which, the
price or prices at which and the terms and conditions upon which the
Securities of such series may be redeemed, in whole or in part, at the
option of the Company;
(h) the obligation or obligations, if any, of the Company to redeem or
purchase the Securities of such series pursuant to any sinking fund or
other mandatory redemption provisions 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, and the terms and conditions upon which, such
Securities shall be redeemed or purchased, in whole or in part, pursuant to
such obligation, and applicable exceptions to the requirements of Section
404 in the case of mandatory redemption or redemption at the option of the
holder;
(i) the denominations in which Securities of such series shall be issuable
if other than denominations of $1,000 and any integral multiple thereof;
(j) any Events of Default, in addition to those specified in Section 801,
with respect to the Securities of such series, and any covenants of the
Company for the benefit of the Holders of the Securities of such series in
addition to those set forth in Article Six;
(k) if the Securities of such series are to be issued in global form, (i)
any limitations on the rights of the Holder or Holders of such Securities
to transfer or exchange the same or to obtain the registration of transfer
thereof, (ii) any limitations on the rights of the Holder or Holders
thereof to obtain certificates therefor in definitive form in lieu of
temporary form, and (iii) any and all other matters incidental to such
Securities;
(l) any limitations on the rights of the Holders of the Securities of such
Series to transfer or exchange such Securities or to obtain the
registration of transfer thereof; and if a service charge will be made for
the registration of transfer or exchange of Securities of such series, the
amount or terms thereof;
(m) any exceptions to Section 113, or variation in the
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definition of Business Day, with respect to the Securities of such series;
and
(n) any other terms of the Securities of such series not inconsistent with
the provisions of this Indenture.
All Securities of any one series shall be substantially identical, except
as to principal amount and date of issue and except as may be set forth in the
terms of such series as contemplated above. The Securities of each series shall
be subordinated in right of payment to Senior Indebtedness as provided in
Article Fifteen.
SECTION 302. Denominations.
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Securities, the Securities of each series shall be issuable in
denominations of $1,000 and any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
Unless otherwise provided as contemplated by Section 301 with respect to
any series of Securities, the Securities shall be executed on behalf of the
Company by an Authorized Executive Officer and may have the corporate seal of
the Company affixed thereto or reproduced thereon attested by any other
Authorized Executive Officer or by the Secretary of the Company. The signature
of any or all of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were at
the time of execution Authorized Executive Officers or the Secretary of the
Company shall bind the Company, 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.
The Trustee shall authenticate and deliver Securities of a series, for
original issue, at one time or from time to time in accordance with the Company
Order referred to below, upon receipt by the Trustee of:
(a) the instrument or instruments establishing the form or forms and terms
of such series, as provided in Sections 201 and 301;
(b) a Company Order requesting the authentication and delivery of such
Securities and, to the extent that the terms of such Securities shall not
have been established in an indenture supplemental hereto, a Board
Resolution, or an Officer's
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Certificate (or any combination thereof), all as contemplated by Sections
201 and 301, establishing such terms;
(c) the Securities of such series, executed on behalf of the Company by an
Authorized Executive Officer;
(d) an Opinion of Counsel to the effect that:
(i) the form or forms of such Securities have been duly authorized by
the Company and have been established in conformity with the
provisions of this Indenture;
(ii) the terms of such Securities have been duly authorized by the
Company and have been established in conformity with the provisions of
this Indenture;
(iii) such Securities, when authenticated and delivered by the Trustee
and issued and delivered by the Company in the manner and subject to
any conditions specified in such Opinion of Counsel, will have been
duly issued under this Indenture and will constitute valid and legally
binding obligations of the Company, entitled to the benefits provided
by this Indenture, and enforceable in accordance with their terms,
subject, as to enforcement, to laws relating to or affecting generally
the enforcement of creditors' rights, including, without limitation,
bankruptcy and insolvency laws and to general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law); and
(iv) all laws and requirements in respect of the execution and
delivery by the Company of such Securities have been complied with.
If the form or terms of the Securities of any series have been established
by or pursuant to a Board Resolution or an Officer's Certificate as permitted by
Section 201 or 301, the Trustee shall not be required to authenticate such
Securities if the issuance of such Securities pursuant to this Indenture will
affect the Trustee's own rights, duties or immunities under the Securities and
this Indenture or otherwise in a manner that is not reasonably acceptable to the
Trustee.
Unless otherwise specified as contemplated by Section 301 with respect to
any series of Securities, each Security shall be dated the date of its
authentication.
Unless otherwise specified as contemplated by Section 301 with respect to
any series of Securities, no Security 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
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authentication substantially in the form provided for herein executed by the
Trustee or its agent by manual signature, 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 to the Company, or any Person acting on
its behalf, but shall never have been issued and sold by the Company, and the
Company 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 the Company, 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 hereof.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities that 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, with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as evidenced by their
execution of such Securities; provided, however, that temporary Securities need
not recite specific redemption, sinking fund, conversion or exchange provisions.
Unless otherwise specified as contemplated by Section 301 with respect to
any series of Securities, after the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable, without
charge to the Holder thereof, for definitive Securities of such series upon
surrender of such temporary Securities at the office or agency of the Company
maintained pursuant to Section 602 in a Place of Payment for such Securities.
Upon surrender of temporary Securities for such exchange, the Company shall,
except as aforesaid, execute, and the Trustee shall authenticate and deliver, in
exchange therefor definitive Securities of the same series, of authorized
denominations and of like tenor and aggregate principal amount. 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.
SECTION 305. Registration; Registration of Transfer and Exchange.
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The Company shall cause to be kept in each office designated pursuant to
Section 602, with respect to the Securities of each series, a register (all
registers kept in accordance with this Section being collectively referred to as
the "Security Register") in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of Securities of
such series and the registration of transfer thereof. The Company shall
designate one Person to maintain the Security Register for the Securities of
each series on a consolidated basis, and such Person is referred to herein, with
respect to such series, as the "Security Registrar." Anything herein to the
contrary notwithstanding, the Company may designate one or more of its offices
as an office in which a register with respect to the Securities of one or more
series shall be maintained, and the Company may designate itself the Security
Registrar with respect to one or more of such series. The Security Register
shall be open for inspection by the Trustee and the Company at all reasonable
times. Except as otherwise specified as contemplated by Section 301 with respect
to the Securities of any series, upon surrender for registration of transfer of
any Security of such series at any office or agency of the Company maintained
pursuant to Section 602 in a Place of Payment for such series, the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of the same
series, of authorized denominations and of like tenor and aggregate principal
amount.
Except as otherwise specified as contemplated by Section 301 with respect
to the Securities of any series, any Security of such series may be exchanged,
at the option of the Holder, for one or more new Securities of the same series,
of authorized denominations and of like tenor and aggregate principal amount,
upon surrender of the Securities to be exchanged at any such office or agency.
Whenever any Securities are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities that the
Holder making the exchange is entitled to receive. All Securities delivered
upon any registration of transfer or exchange of Securities shall be valid
obligations of the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Securities surrendered upon such
registration of transfer or exchange. Every Security presented or surrendered
for registration of transfer or for exchange shall (if so required by the
Company, the Trustee or the Security Registrar) be duly endorsed or shall be
accompanied by a written instrument of transfer in form satisfactory to the
Company, the Trustee or the Security Registrar, as the case may be, duly
executed by the Holder thereof or his attorney duly authorized in writing.
Unless otherwise specified as contemplated by Section 301 with respect to
Securities of any series, no service charge shall be made for any registration
of transfer or exchange of Securities,
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but the Company 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, 406 or 1206 not involving any transfer.
The Company shall not be required to execute or to provide for the
registration of transfer of or the exchange of (a) Securities of any series
during a period of 15 days immediately preceding the date notice is to be given
identifying the serial numbers of the Securities of such series called for
redemption or (b) any Security so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute, and the Trustee shall authenticate and deliver in exchange therefor, a
new Security of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (a) evidence to
their satisfaction of the ownership of and the destruction, loss or theft of any
Security and (b) such security or indemnity as may be reasonably required by
them to save each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security is held by a
Person purporting to be the owner of such Security, the Company shall execute
and, upon the Company's request, the Trustee shall authenticate and deliver, in
lieu of any such destroyed, lost or stolen Security, a new Security of the same
series and of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
Notwithstanding the foregoing, in case any such mutilated, destroyed, lost
or stolen Security has become or is about to become due and payable, the Company
in its discretion may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company 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 reasonable expenses
(including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone other than the Holder
of
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such new Security, and any such new Security shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of such series duly issued hereunder.
The provisions of this Section 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.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Unless otherwise specified as contemplated by Section 301 with respect to
the Securities of any series, interest on any 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.
Subject to Section 311, any interest on any Security of any series that is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (in this Section called "Defaulted Interest") shall forthwith cease
to be payable to the Holder on the related Regular Record Date by virtue of
having been such Holder, and such Defaulted Interest may be paid by the Company,
at its election in each case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities of such series (or their respective
Predecessor Securities) are registered at the close of business on a date
(herein called a "Special Record Date") for the payment of such Defaulted
Interest, which Special Record Date shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security of such series and the date
of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money 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 that 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 the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall
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promptly cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be mailed, first-class postage
prepaid, to each Holder of Securities of such series at the address of such
Holder as it appears in the Security Register, not less than 10 days prior
to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor Securities)
are registered at the close of business on such Special Record Date.
(b) The Company may make payment of any Defaulted Interest on the
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 the Company 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 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, that were carried by such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a 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 such 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, if any, on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by any notice to the contrary.
SECTION 309. Cancellation by Security Registrar.
All Securities surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the Security
Registrar, be delivered to the Security Registrar and, if not theretofore
canceled, shall be promptly canceled by the Security Registrar. The Company may
at any time deliver to the Security Registrar for cancellation any Securities
previously authenticated and delivered hereunder that the Company may have
acquired in any manner whatsoever or that the
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Company shall not have issued and sold, and all Securities so delivered shall be
promptly canceled by the Security Registrar. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section, except as expressly permitted by this Indenture. All canceled
Securities held by the Security Registrar shall be returned to the Company.
The Security Registrar shall promptly deliver evidence of any cancellation of a
Security in accordance with this Section 309 to the Trustee and the Company.
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for Securities
of any series, interest on the Securities of each series shall be computed on
the basis of a 360-day year consisting of twelve 30-day months and, for any
period shorter than a full month, on the basis of the actual number of days
elapsed in such period.
SECTION 311. Extension of Interest Payment Period.
Unless otherwise specified as contemplated by Section 301 with respect to
Securities of any series, the Company shall have the right at any time, so long
as the Company is not in default in the payment of interest on the Securities of
any series hereunder, to extend interest payment periods on all Securities of
such series for a period of up to 60 consecutive months, but not beyond the
Maturity of such Securities, and at, or at any time prior to, the end of any
such extended interest payment period, the Company shall pay all interest then
accrued and unpaid (together with interest thereon at the rate specified for
such Securities to the extent permitted by applicable law) in the same manner as
provided for the payment of Defaulted Interest in Section 307 hereof; provided
that, during any such extended interest payment period, the Company shall not,
and shall not permit any Affiliate directly or indirectly controlled by the
Company to, pay or declare any dividend on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any of the capital stock of the Company
or such Affiliate, or make any guarantee payments with respect to the foregoing
(other than payments under any guarantee by the Company with respect to any
capital stock of any such Affiliate, provided that the proceeds of such capital
stock were used to purchase Securities); and provided further that any such
extended interest payment period may only be selected with respect to the
Securities of such series if an extended interest payment period of identical
length is simultaneously selected for all Securities then Outstanding under this
Indenture. Prior to the end of any such extended interest pay period of less
than 60 consecutive months, the Company may further extend the interest payment
period, provided that such extended interest payment period together with all
such further extensions thereof may not exceed a period of 60 consecutive months
and subject to the limitations described above. Following the termination of any
extended interest payment period, if the Company has paid all accrued and unpaid
interest (together with interest thereon at the rate specified for such
Securities to the extent
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permitted by applicable law) required by the Securities for such period, the
Company shall have the right to again extend the interest payment periods for up
to 60 consecutive months as herein provided. The month in which any notice is
given pursuant to this Section 311 shall constitute one of the months that
comprise the maximum extended interest payment period.
Unless otherwise specified in an indenture supplemental hereto, a Board
Resolution or an Officer's Certificate (or any combination thereof), the Company
shall give the holders of the Securities and the Trustee notice of its selection
of such extended interest payment period ten Business Days prior to the related
Interest Payment Date.
SECTION 312. CUSIP Numbers
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
--------
state that no representation is made as to the correctness of such "CUSIP"
numbers either as printed on the Securities or as contained in any notice of
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such "CUSIP" numbers.
ARTICLE FOUR
Redemption of Securities
SECTION 401. Applicability of Article.
Securities of any series that 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 such series) in
accordance with this Article.
SECTION 402. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced by
a Board Resolution or an Officer's Certificate. The Company may not redeem (or
otherwise purchase) less than all of the Securities of any series if, as a
result of such partial redemption (or purchase), the Securities of such series
would be delisted from any national securities exchange on which they are then
listed, and in such case if the Company elects to redeem (or otherwise purchase)
any of the Securities of such series, the Company shall redeem (or otherwise
purchase) all of them. The Company shall, at least 45 days prior to the
Redemption Date fixed by the Company (unless shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date and of the
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principal amount of such Securities to be redeemed. In the case of any
redemption of Securities (a) prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or elsewhere in this
Indenture, or (b) pursuant to an election of the Company that is subject to a
condition specified in the terms of such Securities, the Company shall furnish
the Trustee with an Officer's Certificate evidencing compliance with such
restriction or condition.
SECTION 403. Selection of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected by the Security Registrar
from the Outstanding Securities of such series not previously called for
redemption, by such method as shall be provided for any particular series, or,
in the absence of any such provision, by such method as the Security Registrar
shall deem fair and appropriate and that may provide for the selection for
redemption of portions (equal to the minimum authorized denomination for
Securities of such 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 such series; provided, however, that
if, as indicated in an Officer's Certificate, the Company shall have offered to
purchase all or any principal amount of the Securities then Outstanding of any
series, and less than all of such Securities as to which such offer was made
shall have been tendered to the Company for such purchase, the Security
Registrar, if so directed by Company Order, shall select for redemption all or
any principal amount of such Securities that have not been so tendered.
The Security Registrar shall promptly notify the Company and the Trustee in
writing of the Securities selected for redemption and, in the case of any
Securities selected to be redeemed in part, the principal amount thereof to be
redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities that has been or is to be redeemed.
SECTION 404. Notice of Redemption.
Notice of redemption shall be given in the manner provided in Section 106
to the Holders of the Securities to be redeemed not less than 30 nor more than
60 days prior to the Redemption Date.
All notices of redemption shall identify the Securities to be redeemed
(including CUSIP number) and state:
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(a) the Redemption Date,
(b) the Redemption Price,
(c) if less than all the Securities of any series are to be redeemed, the
identification of the particular Securities to be redeemed and the portion
of the principal amount of any Security to be redeemed in part,
(d) that on the Redemption Date the Redemption Price, together with accrued
interest, if any, to the Redemption Date, will become due and payable upon
each such Security to be redeemed and, if applicable, that interest thereon
will cease to accrue on and after said date,
(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price and accrued interest, if any, unless it
shall have been specified as contemplated by Section 301 with respect to
such Securities that such surrender shall not be required,
(f) that the redemption is for a sinking or other fund, if such is the
case, and
(g) such other matters as the Company shall deem desirable or appropriate.
If so specified with respect to any Securities in accordance with Section
301, with respect to any notice of redemption of Securities at the election of
the Company, unless, upon the giving of such notice, such Securities shall be
deemed to have been paid in accordance with Section 701, such notice may state
that such redemption shall be conditional upon the receipt by the Paying Agent
or Agents for such Securities, on or prior to the date fixed for such
redemption, of money sufficient to pay the principal of and premium, if any, and
interest, if any, on such Securities and that if such money shall not have been
so received such notice shall be of no force or effect and the Company shall not
be required to redeem such Securities. In the event that such notice of
redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the Paying Agent or Agents for the Securities otherwise to have been
redeemed shall promptly return to the Holders thereof any of such Securities
that had been surrendered for payment upon such redemption. Notice of redemption
of Securities to be redeemed at the election of the Company, and any notice of
non-satisfaction of a condition for redemption as aforesaid, shall be given by
the Company or, at the Company's request, by the Security Registrar in the name
and at the expense of the Company. Notice of mandatory redemption of
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Securities shall be given by the Security Registrar in the name and at the
expense of the Company.
SECTION 405. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, and the conditions, if
any, set forth in such notice having been satisfied, the Securities or portions
thereof so to be redeemed shall, on the Redemption Date, become due and payable
at the Redemption Price therein specified, and from and after such date (unless,
in the case of an unconditional notice of redemption, the Company shall default
in the payment of the Redemption Price and accrued interest, if any) such
Securities or portions thereof, if interestbearing, shall cease to bear
interest. Upon surrender of any such Security for redemption in accordance with
such notice, such Security or portion thereof shall be paid by the Company at
the Redemption Price, together with accrued interest, if any, to the Redemption
Date; provided, however, that no such surrender shall be a condition to such
payment if so specified as contemplated by Section 301 with respect to such
Security; and provided, further, that except as otherwise specified as
contemplated by Section 301 with respect to such Security any installment of
interest on any Security the Stated Maturity of which installment is on or prior
to the Redemption Date shall be payable to the Holder of such Security, or one
or more Predecessor Securities, registered as such at the close of business on
the related Regular Record Date according to the terms of such Security and
subject to the provisions of Section 307.
SECTION 406. Securities Redeemed in Part.
Upon the surrender of any Security that is to be redeemed only in part at a
Place of Payment therefor (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), the Company 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
requested by such Holder and of like tenor and in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the
Security so surrendered.
ARTICLE FIVE
Sinking Funds
SECTION 501. Applicability of Article.
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The provisions of this Article shall be applicable to any sinking fund for
the retirement of the Securities of any 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 in excess of such minimum amount provided for by the
terms of Securities of any series is herein referred to as an "optional sinking
fund payment". If provided for by the terms of Securities of any series, the
cash amount of any sinking fund payment may be subject to reduction as provided
in Section 502. Each sinking fund payment shall be applied to the redemption of
Securities of the series in respect of which it was made, as provided for by the
terms of such Securities.
SECTION 502. Satisfaction of Sinking Fund Payments
With Securities.
The Company (a) may deliver Outstanding Securities (other than any
previously called for redemption) of a series in respect of which a mandatory
sinking fund payment is to be made, and (b) may apply as a credit Securities of
such series that have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities or
Outstanding Securities purchased by the Company, in each case in satisfaction of
all or any part of such mandatory sinking fund payment with respect to the
Securities of such series; provided, however, that no Securities shall be
applied in satisfaction of a mandatory sinking fund payment if such Securities
shall have been previously so applied. Securities so applied shall be received
and credited for such purpose by the Trustee at the 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.
SECTION 503. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for the
Securities of any series, the Company shall deliver to the Trustee an Officer's
Certificate specifying:
(a) the amount of the next succeeding mandatory sinking fund payment for
such series;
(b) the amount, if any, of the optional sinking fund payment to be made
together with such mandatory sinking fund payment;
(c) the aggregate sinking fund payment;
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(d) the portion, if any, of such aggregate sinking fund payment that is to
be satisfied by the payment of cash;
(e) the portion, if any, of such aggregate sinking fund payment that is to
be satisfied by delivering and crediting Securities of such series pursuant
to Section 502, and stating the basis for such credit and that such
Securities have not previously been so credited, and the Company shall also
deliver to the Trustee any Securities to be so delivered. If the Company
shall not deliver such Officer's Certificate, the next succeeding sinking
fund payment for such series shall be made entirely in cash in the amount
of the mandatory sinking fund payment. Not less than 30 days before each
such sinking fund payment date, the Trustee shall select the Securities to
be redeemed upon such sinking fund payment date in the manner specified in
Section 403 and cause notice of the redemption thereof to be given in the
name of and at the expense of the Company in the manner provided in Section
404. Such notice having been duly given, the redemption of such Securities
shall be made upon the terms and in the manner stated in Sections 405 and
406.
ARTICLE SIX
Covenants
SECTION 601. Payment of Principal, Premium and Interest.
The Company shall pay the principal of and premium, if any, and interest,
if any, on the Securities of each series in accordance with the terms of such
Securities and this Indenture. The Company shall pay interest on overdue
principal and, to the extent lawful, interest on overdue installments of
interest (including interest accruing during any period in respect of which the
Company shall have elected to extend any interest payment period as provided in
Section 311 hereof) at the rate per annum borne by the Securities in respect of
which such principal and/or interest is payable, which interest on overdue
principal and/or interest shall accrue from the date such amounts became
overdue, or from such other date as may be specified in the Securities.
SECTION 602. Maintenance of Office or Agency.
The Company shall maintain in each Place of Payment for the Securities of
each series an office or agency where payment of such Securities shall be made,
where the registration of transfer or exchange of such Securities may be
effected and where notices and demands to or upon the Company in respect of such
Securities and this Indenture may be served. The Company shall give prompt
written
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notice to the Trustee of the location, and any change in the location, of each
such office or agency and prompt notice to the Holders of any such change in the
manner specified in Section 106. If at any time the Company shall fail to
maintain any such required office or agency in respect of Securities of any
series, or shall fail to furnish the Trustee with the address thereof, payment
of such Securities shall be made, registration of transfer or exchange thereof
may be effected and notices and demands may be served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
for all such purposes in any such event.
The Company may also from time to time designate one or more other offices
or agencies with respect to the Securities of one or more series for any or all
of the foregoing purposes and may from time to time rescind such designations;
provided, however, that, unless otherwise specified as contemplated by Section
301 with respect to the Securities of such series, no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency for such purposes in each Place of Payment for such
Securities in accordance with the requirements set forth above. The Company
shall give prompt written notice to the Trustee, and prompt notice to the
Holders in the manner specified in Section 106, of any such designation or
rescission and of any change in the location of any such other office or agency.
Anything herein to the contrary notwithstanding, any office or agency
required by this Section may be maintained at an office of the Company, in which
event the Company shall perform all functions to be performed at such office or
agency.
SECTION 603. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with respect
to the Securities of any series, it shall, on or before each due date of the
principal of and premium, if any, and interest, if any, on any of such
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal and premium or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided. The Company shall promptly notify the Trustee of any
failure by the Company (or any other obligor on such Securities) to make any
payment of principal of or premium, if any, or interest, if any, on such
Securities.
Whenever the Company shall have one or more Paying Agents for the
Securities of any series, it shall, on or before each due date of the principal
of and premium, if any, and interest, if any, on such Securities, deposit with
such Paying Agents sums sufficient (without duplication) to pay the principal
and premium or interest
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so becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest, and (unless such Paying Agent
is the Trustee) the Company shall promptly notify the Trustee of any failure by
it so to act.
The Company shall cause each Paying Agent for the Securities of any series,
other than the Company or 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, that such Paying Agent shall:
(a) hold all sums held by it for the payment of the principal of and
premium, if any, or interest, if any, on such Securities 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 failure by the Company (or any other
obligor upon such Securities) to make any payment of principal of or
premium, if any, or interest, if any, on such Securities; 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 and furnish to the Trustee such
information as such Paying Agent possesses regarding the names and
addresses of the Persons entitled to such sums.
The Company may at any time pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums held in trust by the Company 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 the Company or such Paying Agent and, if so
stated in a Company Order delivered to the Trustee, in accordance with the
provisions of Article Seven; 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 money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of and premium, if any,
or interest, if any, on any Security and remaining unclaimed for two years after
such principal and premium, if any, or interest has become due and payable shall
be paid to the Company on Company Request, or, if then held by the Company,
shall be discharged from such trust; and, upon such payment or discharge, the
Holder of such Security shall, as an unsecured general creditor and not as a
Holder of an Outstanding Security, look only to the Company for payment of the
amount so due and payable and remaining unpaid, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
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Trustee or such Paying Agent, before being required to make any such payment to
the Company, may at the expense of the Company cause to be mailed, on one
occasion only, notice to such Holder 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 mailing, any unclaimed balance of such money then remaining will be
paid to the Company.
SECTION 604. Corporate Existence.
Subject to the rights of the Company under Article Eleven, the Company
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence.
SECTION 605. Maintenance of Properties.
The Company shall cause (or, with respect to property owned in common with
others, make reasonable effort to cause) all its properties used or useful in
the conduct of its business to be maintained and kept in good condition, repair
and working order and shall cause (or, with respect to property owned in common
with others, make reasonable effort to cause) to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as, in the
judgment of the Company, may be necessary so that the business carried on in
connection therewith may be properly conducted; provided, however, that nothing
in this Section shall prevent the Company from discontinuing, or causing the
discontinuance of, the operation and maintenance of any of its properties if
such discontinuance is, in the judgment of the Company, desirable in the conduct
of its business.
SECTION 606. Statement as to Compliance.
The Company shall deliver to the Trustee, within 90 days after the end of
each fiscal year of the Company ending after the date hereof, a written
statement, which need not comply with Section 102, signed by the principal
executive officer, the principal financial officer or the principal accounting
officer of the Company, stating that
(a) a review of the activities of the Company during such year and of
performance under this Indenture has been made under such officer's
supervision, and
(b) to the best of such officer's knowledge, based on such review, and
without regard to any period of grace or requirement of notice provided
under this Indenture, either (1) the Company has fulfilled all its
obligations under this
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Indenture throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to
such officer and the nature and status thereof, or (2) no Event of Default
has occurred and is continuing or, if an Event of Default has occurred and
is continuing, specifying each such Event of Default known to such officer
and the nature and status thereof.
The Company shall deliver to Trustee, as promptly as practicable after
any Authorized Executive Officer becomes aware of any continuing Event of
Default or any event that, with notice or lapse of time or both, would become an
Event of Default, an Officer's Certificate specifying such Event of Default or
event and the Action the Company is taking or proposes to take with respect
thereto.
SECTION 607. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in (a) Section 602 or any additional covenant
or restriction specified with respect to the Securities of any series as
contemplated by Section 301 if, before the time for such compliance, the Holders
of at least a majority in aggregate principal amount of the Outstanding
Securities of all series with respect to which compliance with Section 602 or
such additional covenant or restriction is to be omitted, considered as one
class, shall, by Act of such Holders, either waive such compliance in such
instance or generally waive compliance with such term, provision or condition
and (b) Section 604, 605, 606 or Article Eleven if, before the time for such
compliance, the Holders of at least a majority in principal amount of Securities
Outstanding under this Indenture shall, by Act of such Holders, either waive
such compliance in such instance or generally waive compliance with such term,
provision or condition; but, in the case of (a) or (b) no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
SECTION 608. Restriction on Payment of Dividends.
The Company shall not, and shall not permit any Affiliate directly or
indirectly controlled by the Company to, declare or pay any dividend on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the capital stock of the Company or such Affiliate, or make any guarantee
payments with respect to the foregoing if at such time (a) there shall have
occurred and be continuing any event that, with notice or lapse of time or both,
would become an Event of Default hereunder, or (b) the Company shall have
elected to extend any interest payment period as
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provided in Section 311, and any such period, or any extension thereof, shall be
continuing.
SECTION 609. Payment for Consents.
Neither the Company nor any Affiliate directly or indirectly controlled by
the Company shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for
or as an inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Securities, unless such consideration is
offered to be paid or agreed to be paid to all Holders who so consent, waive or
agree to amend within the period of time set forth in the documents soliciting
such consent, waiver or amendment.
ARTICLE SEVEN
Satisfaction and Discharge
SECTION 701. Satisfaction and Discharge of Securities.
Any Security or Securities, or any portion of the principal amount thereof,
shall be deemed to have been paid for all purposes of this Indenture, and the
entire indebtedness of the Company in respect thereof shall be deemed to have
been satisfied and discharged, if there shall have been irrevocably deposited
with the Trustee or any Paying Agent (other than the Company), in trust:
(a) money in an amount that shall be sufficient, or
(b) in the case of a deposit made prior to the Maturity of such Securities
or portions thereof, Government Obligations, the principal of and the
interest on which when due, without any regard to reinvestment thereof,
will provide moneys that, together with the money deposited with or held by
the Trustee or such Paying Agent, shall be sufficient, or
(c) a combination of (a) or (b) that shall be sufficient,
to pay when due the principal of and premium, if any, and interest, if any, due
and to become due on such Securities or portions thereof on or prior to
Maturity; provided, however, that in the case of the provision for payment or
redemption of less than all the Securities of any series, such Securities or
portions thereof shall have been selected by the Security Registrar as provided
herein and, in the case of a redemption, the notice requisite to the validity of
such redemption shall have been given, or irrevocable authority shall have been
given by the Company to the Trustee to give such notice, under arrangements
satisfactory to the Trustee; and provided further that the Company shall have
delivered to the Trustee and such Paying Agent:
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(w) if such deposit shall have been made prior to the Maturity of
such Securities, a Company Order stating that the money and Government
Obligations deposited in accordance with this Section shall be held in
trust, as provided in Section 703; and
(x) if Government Obligations shall have been deposited, an
Opinion of Counsel that the obligations so deposited constitute
Government Obligations and do not contain provisions permitting the
redemption or other prepayment at the option of the issuer thereof,
and an opinion of an independent public accountant of nationally
recognized standing, selected by the Company, to the effect that the
requirements set forth in clause (b) above have been satisfied; and
(y) if such deposit shall have been made prior to the Maturity of
such Securities or portions thereof, an Opinion of Counsel to the
effect that (1) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (2) since the
date 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 of Counsel shall confirm that, the Holders of
such Securities or portions thereof will not recognize income, gain or
loss for Federal income tax purposes as a result of the satisfaction
and discharge of the Company's indebtedness in respect of such
Securities, and such Holders will be subject to Federal income
taxation on the same amounts and in the same manner and at the same
times as if such satisfaction and discharge had not occurred; and
(z) if such deposit shall have been made prior to the Maturity of
such Securities, such deposit shall not result in the Company, the
Trustee or such trust being deemed an "investment company" under the
Investment Company Act of 1940, as amended.
Upon the deposit of money or Government Obligations, or both, in accordance
with this Section, together with the documents required by clauses (w), (x), (y)
and (z) above, the Trustee shall, upon receipt of a Company Request, acknowledge
in writing that the Security or Securities or portions thereof with respect to
which such deposit was made are deemed to have been paid for all purposes of
this Indenture and that the entire indebtedness of the Company in respect
thereof has been satisfied and discharged as contemplated in this Section;
provided, however, in the event that all of the conditions set forth in the
preceding paragraph shall have been satisfied in respect of any Securities or
portions thereof, except that, for any reason, the Opinion of Counsel specified
in clause (y) above shall have been delivered to the same effect as specified in
clause (y) above but not based upon any such ruling or change in law, then such
Securities or portions thereof shall nevertheless be deemed to have been paid
for all purposes of this Indenture, and such Holders shall nevertheless be no
longer entitled to the benefits of this Indenture or of any of the covenants of
the Company under Article Six (except the covenants of the Company contained in
Sections 602 and 603) or any other covenants made in respect of such Securities
or portions thereof as contemplated by Section 301, but the indebtedness of the
Company in respect of such Securities or portions thereof shall not be deemed to
have been satisfied and discharged prior to the Maturity of such Securities or
portions thereof for any other purpose, and such Holders shall continue to be
entitled to look to the Company for payment of the indebtedness represented
thereby (and upon Company Request the Trustee shall acknowledge in writing that
such Securities or portions thereof are deemed to have been paid for all
purposes of this Indenture).
If payment at Stated Maturity of less than all of the Securities of any
series is to be provided for in the manner and with the effect provided in this
Section, the Security Registrar shall select such Securities, or portions of
principal amount thereof, in the manner specified by Section 403 for selection
for redemption of less than all the Securities of a series.
In the event that Securities that shall be deemed to have been paid for
purposes of this Indenture, and, if such is the case, in respect of which the
Company's indebtedness shall have been satisfied and discharged, all as provided
in this Section, do not mature and are not to be redeemed within the sixty (60)
day period commencing with the date of the deposit of moneys or Government
Obligations, as aforesaid, the Company shall, as promptly as practicable, give a
notice, in the same manner as a notice of
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redemption with respect to such Securities, to the Holders of such Securities to
the effect that such deposit has been made and the effect thereof.
Notwithstanding that any Securities shall be deemed to have been paid for
purposes of this Indenture, as aforesaid, the obligations of the Company and the
Trustee in respect of such Securities under Sections 304, 305, 306, 404, 503 (as
to notice of redemption), 602, 603, 907 and 914 and this Article Seven shall
survive.
The Company shall pay, and shall indemnify the Trustee or any Paying Agent
with which Government Obligations shall have been deposited as provided in this
Section against, any tax, fee or other charge imposed on or assessed against
such Government Obligations or the principal or interest received in respect of
such Government Obligations, including, but not limited to, any such tax payable
by any entity deemed, for tax purposes, to have been created as a result of such
deposit.
Anything herein to the contrary notwithstanding, (a) if, at any time after
a Security would be deemed to have been paid for purposes of this Indenture,
and, if such is the case, the Company's indebtedness in respect thereof would be
deemed to have been satisfied and discharged, pursuant to this Section (without
regard to the provisions of this paragraph), the Trustee or any Paying Agent, as
the case may be, shall be required to return the money or Government
Obligations, or combination thereof, deposited with it as aforesaid to the
Company or its representative under any applicable Federal or State bankruptcy,
insolvency or other similar law, such Security shall thereupon be deemed
retroactively not to have been paid and any satisfaction and discharge of the
Company's indebtedness in respect thereof shall retroactively be deemed not to
have been effected, and such Security shall be deemed to remain Outstanding, and
(b) any satisfaction and discharge of the Company's indebtedness in respect of
any Security shall be subject to the provisions of the last paragraph of Section
603.
SECTION 702. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further effect
(except as hereinafter expressly provided), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) no Securities remain Outstanding hereunder; and
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
provided, however, that if, in accordance with the last paragraph
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of Section 701, any Security, previously deemed to have been paid for purposes
of this Indenture, shall be deemed retroactively not to have been so paid, this
Indenture shall thereupon be deemed retroactively not to have been satisfied and
discharged, as aforesaid, and to remain in full force and effect, and the
Company shall execute and deliver such instruments as the Trustee shall
reasonably request to evidence and acknowledge the same.
Notwithstanding the satisfaction and discharge of this Indenture as
aforesaid, the obligations of the Company and the Trustee under Sections 304,
305, 306, 404, 503 (as to notice of redemption), 602, 603, 907 and 914 and this
Article Seven shall survive.
Upon satisfaction and discharge of this Indenture as provided in this
Section, the Trustee shall assign, transfer and turn over to the Company,
subject to the lien provided by Section 907, any and all money, securities and
other property then held by the Trustee for the benefit of the Holders of the
Securities other than money and Government Obligations held by the Trustee
pursuant to Section 703.
SECTION 703. Application of Trust Money.
Neither the Government Obligations nor the money deposited pursuant to
Section 701, nor the principal or interest payments on any such Government
Obligations, shall be withdrawn or used for any purpose other than, and shall be
held in trust for, the payment of the principal of and premium, if any, and
interest, if any, on the Securities or portions of principal amount thereof in
respect of which such deposit was made, all subject, however, to the provisions
of Section 603; provided, however, that, so long as there shall not have
occurred and be continuing an Event of Default, any cash received from such
principal or interest payments on such Government Obligations, if not then
needed for such purpose, shall, to the extent practicable, be invested in
Government Obligations of the type described in clause (b) in the first
paragraph of Section 701 maturing at such times and in such amounts as shall be
sufficient to pay when due the principal of and premium, if any, and interest,
if any, due and to become due on such Securities or portions thereof on and
prior to the Maturity thereof, and interest earned from such reinvestment shall
be paid over to the Company as received, free and clear of any trust, lien or
pledge under this Indenture except the lien provided by Section 907; and
provided, further, that, so long as there shall not have occurred and be
continuing an Event of Default, any moneys held in accordance with this Section
on the Maturity of all such Securities in excess of the amount required to pay
the principal of and premium, if any, and interest, if any, then due on such
Securities shall be paid over to the Company free and clear of any trust, lien
or pledge under this Indenture except the lien provided by Section
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907; and provided, further, that if an Event of Default shall have occurred and
be continuing, moneys to be paid over to the Company pursuant to this Section
shall be held until such Event of Default shall have been waived or cured.
ARTICLE EIGHT
Events of Default; Remedies
SECTION 801. Events of Default.
"Event of Default", wherever used herein with respect to Securities of any
series, means any one of the following events:
(a) failure to pay any interest on any Security of such series within
fifteen (15) days after the same becomes due and payable (whether or not payment
is prohibited by the provisions of Article Fifteen hereof or otherwise);
provided, however, that a valid extension of the interest payment period by the
Company as contemplated in Section 311 of this Indenture shall not constitute a
failure to pay interest for this purpose; or
(b) failure to pay the principal and premium, if any, on any Security of
such series at its Maturity (whether or not payment is prohibited by the
provisions of Article Fifteen hereof or otherwise); or
(c) failure to perform or breach of any covenant or warranty of the Company
in this Indenture (other than a covenant or warranty a default in the
performance of which or breach of which is elsewhere in this Section
specifically dealt with or which has expressly been included in this Indenture
solely for the benefit of one or more series of Securities other than such
series) for a period of thirty (30) days after there has been given, by
registered or certified mail, to the Company by the Trustee, or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of such 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, unless the Trustee, or the Trustee and the
Holders of a principal amount of Securities of such series not less than the
principal amount of Securities the Holders of which gave such notice, as the
case may be, shall agree in writing to an extension of such period prior to its
expiration; or
(d) the entry by a court having jurisdiction in the premises of (1) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law, or (2) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition by
one or more Persons other than the Company seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company under any
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applicable Federal or State law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official for the
Company or for any substantial part of its property, or ordering the winding up
or liquidation of its affairs, and any such decree or order for relief or any
such other decree or order shall have remained unstayed and in effect for a
period of ninety (90) consecutive days; or
(e) the commencement by the Company of a voluntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or of any other case or proceeding to be adjudicated a bankrupt or
insolvent, or the consent by the Company to the entry of a decree or order for
relief in respect of it in a case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or
the filing by the Company of a petition or answer or consent seeking
reorganization or relief under any applicable Federal or State law, or the
consent by the Company to the filing of such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of the Company or of any substantial part of
its property, or the making by the Company of an assignment for the benefit of
creditors, or the admission by the Company in writing of its inability to pay
its debts generally as they become due, or the authorization of such action by
the Board of Directors; or
(f) any other Event of Default specified with respect to Securities of such
series.
SECTION 802. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default due to the default in payment of principal of, or
interest on, any series of Securities, or due to the default in the performance
or breach of any other covenant or warranty of the Company applicable to the
Securities of such series but not applicable to all outstanding Securities,
shall have occurred and be continuing, either the Trustee or the Holders of not
less than 25% in principal amount of the Securities of such series may then
declare the principal of all Securities of such series and interest accrued
thereon to be due and payable immediately (provided that the payment of
principal and interest on such Securities shall remain subordinated to the
extent provided in Article Fifteen hereof); provided that, upon the occurrence
of any Event of Default specified in paragraph (d) or paragraph (e) of Section
801 hereof, the principal of all Securities and interest accrued thereon shall
immediately become due and payable without any declaration or other action by
the Trustee or such Holders (provided that the payment of principal of and
interest on such Securities shall remain subordinated to the extent provided in
this Indenture). If an Event of Default due to default in the
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performance of any other of the covenants or agreements herein applicable to all
Outstanding Securities shall have occurred and be continuing, either the Trustee
or the Holders of not less than 25% in principal amount of all Securities then
Outstanding (considered as one class), and not the Holders of the Securities of
any one of such series, may declare the principal of all Securities and interest
accrued thereon to be due and payable immediately (provided that the payment of
principal of and interest on such Securities shall remain subordinated to the
extent provided in the Indenture).
At any time after such a declaration of acceleration with respect to
Securities of any series shall have been made and before a judgment or decree
for payment of the money due shall have been obtained by the Trustee as
hereinafter in this Article provided, the Event or Events of Default giving rise
to such declaration of acceleration shall, without further act, be deemed to
have been waived, and such declaration and its consequences shall, without
further act, be deemed to have been rescinded and annulled, if
(a) the Company shall have paid or deposited with the Trustee a sum
sufficient to pay
(1) all overdue interest on all Securities of such series;
(2) the principal of and premium, if any, on any Securities of such
series that have become due otherwise than by such declaration of
acceleration and interest thereon at the rate or rates prescribed
therefor in such Securities;
(3) interest upon overdue interest at the rate or rates prescribed
therefor in such Securities to the extent that payment of such
interest is lawful; and
(4) all amounts due to the Trustee under Section 907;
and
(b) any other Event or Events of Default with respect to Securities of such
series, other than the non-payment of the principal of Securities of such series
that shall have become due solely by such declaration of acceleration, shall
have been cured or waived as provided in Section 813.
No such rescission shall affect any subsequent Event of Default or impair
any right consequent thereon.
SECTION 803. Collection of
Indebtedness and Suits for Enforcement by Trustee.
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If an Event of Default described in clause (a) or (b) of Section 801 shall
have occurred and be continuing, the Company shall, upon demand of the Trustee,
pay to it, for the benefit of the Holders of the Securities of the series with
respect to which such Event of Default shall have occurred, the whole amount
then due and payable on such Securities for principal and premium, if any, and
interest, if any, and, to the extent permitted by law, interest on premium, if
any, and on any overdue principal and interest, at the rate or rates prescribed
therefor in such Securities and, in addition thereto, such further amount as
shall be sufficient to cover any amounts due to the Trustee under Section 907.
If the Company shall fail 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, may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon such Securities, wherever
situated.
If an Event of Default with respect to Securities of any series shall have
occurred and be 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 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 804. 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 the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
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
the Company for the payment of overdue principal 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 of principal, premium,
if any, and interest, if any, owing and unpaid in respect of the Securities and
to file such other papers or documents as may be necessary or advisable in order
to have the
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claims of the Trustee (including any claim for amounts due to the Trustee under
Section 907) 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 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 amounts due it under Section 907.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 805. Trustee May Enforce Claims Without
Possession of Securities.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities 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 in respect of which such judgment has been recovered.
SECTION 806. Application of Money Collected.
Subject to the provisions of Article Fifteen, any money collected by the
Trustee pursuant to this Article 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, if any, upon
presentation of the Securities in respect of which or for the benefit of which
such money shall have been collected 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 under Section 907;
Second: To the payment of the amounts then due and unpaid
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upon the Securities for principal of and premium, if any, and interest, if any,
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 amounts
due and payable on such Securities for principal, premium, if any, and interest,
if any, respectively; and
Third: To the Company.
SECTION 807. Limitation on Suits.
No Holder 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 shall have previously given written notice to the Trustee
of a continuing Event of Default with respect to the Securities of such series;
(b) the Holders of not less than a 25% in aggregate principal amount of the
Outstanding Securities of all series in respect of which an Event of Default
shall have occurred and be continuing, considered as one class, 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 shall have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
complying with such request;
(d) the Trustee, for sixty (60) days after its receipt of such notice,
request and offer of indemnity, shall have failed to institute any such
proceeding; and
(e) no direction inconsistent with such written request shall have been
given to the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the Outstanding Securities of all series in
respect of which an Event of Default shall have occurred and be continuing,
considered as one class;
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 of such
Holders.
SECTION 808. Unconditional Right of Holders to Receive
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Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of and premium, if any, and (subject to Sections 307
and 311) interest, if any, on such Security on the Stated Maturity or Maturities
expressed in such Security (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 809. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding shall have been
discontinued or abandoned for any reason, or shall have been determined
adversely to the Trustee or to such Holder, then and in every such case, subject
to any determination in such proceeding, the Company, the Trustee and such
Holder shall be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and such Holder
shall continue as though no such proceeding had been instituted.
SECTION 810. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 306, no right
or remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 811. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder 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 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, as the case may be.
SECTION 812. Control by Holders of Securities.
If an Event of Default shall have occurred and be continuing
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in respect of a series of Securities, the Holders of 25% in principal amount of
the Outstanding Securities of such 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 the Securities of such series; provided, however, that if an Event of
Default shall have occurred and be continuing with respect to more than one
series of Securities, the Holders of 25% in aggregate principal amount of the
Outstanding Securities of all such series, considered as one class, shall have
the right to make such direction, and not the Holders of the Securities of such
series; and provided, further, that such direction shall not be in conflict with
any rule of law or with this Indenture. Before proceeding to exercise any right
or power hereunder at the direction of such Holders, the Trustee shall be
entitled to receive from such Holders reasonable security or indemnity against
the costs, expenses and liabilities that might be incurred by it in complying
with any such direction.
SECTION 813. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may, on behalf of the Holders of all the
Securities of such series, 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, if
any, on any Security of such series, or
(b) in respect of a covenant or provision hereof that, under Section 1202,
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 and all
Events 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 impair any right consequent thereon.
SECTION 814. Undertaking for Costs.
The Company and the Trustee agree, and each Holder by its acceptance of a
Security shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses
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made by such party litigant; but the provisions of this Section shall not apply
to any suit instituted by the Trustee, to any suit instituted by any Holder, or
group of Holders, holding in the aggregate more than 10% in aggregate principal
amount of the Outstanding Securities of all series in respect of which such suit
may be brought, considered as one class, or to any suit instituted by any Holder
for the enforcement of the payment of the principal of or premium, if any, or
interest, if any, on any Security on or after the Stated Maturity or Maturities
expressed in such Security (or, in the case of redemption, on or after the
Redemption Date).
SECTION 815. Waiver of Stay or Extension Laws.
The Company 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 stay or extension law, wherever enacted,
now or at any time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Company (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.
ARTICLE NINE
The Trustee
SECTION 901. Certain Duties and Responsibilities.
(a) The Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee in the Trust
Indenture Act.
(b) No provision of this Indenture shall require the Trustee 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.
(c) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
SECTION 902. Notice of Defaults.
The Trustee shall give notice of any default hereunder with
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respect to the Securities of any series to the Holders of Securities of such
series in the manner and to the extent required to do so by the Trust Indenture
Act, unless such default shall have been cured or waived; provided, however,
that in the case of any default of the character specified in Section 801(c), no
such notice to Holders shall be given until at least 45 days after the
occurrence thereof. For the purpose of this Section, the term "default" means
any event that is, or after notice or lapse of time, or both, would become, an
Event of Default.
SECTION 903. Certain Rights of Trustee.
Subject to the provisions of Section 901 and to the applicable provisions
of the Trust Indenture Act:
(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, other
evidence of indebtedness 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 the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order, or as otherwise
expressly provided herein, 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 of its selection, 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
Holder pursuant to this Indenture, unless such Holder shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in complying 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,
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consent, order, bond, debenture, note, other evidence of indebtedness 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 (subject to applicable legal requirements) be entitled to examine, during
normal business hours, the books, records and premises of the Company,
personally or by agent or attorney;
(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;
(h) except as otherwise provided in Section 801, the Trustee shall not be
charged with knowledge of any Event of Default with respect to the Securities of
any series for which it is acting as Trustee, unless either (1) a Responsible
Officer of the Trustee shall have actual knowledge of the Event of Default, or
(2) written notice of such Event of Default shall have been given to the Trustee
by the Company, any other obligor on such Securities or by any Holder of such
Securities; and
(i) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken 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.
SECTION 904. Not Responsible for Recitals or Issuance
of Securities.
The recitals contained herein and in the Securities (except the Trustee's
certificates of authentication) shall be taken as the statements of the Company,
and neither the Trustee nor any Authenticating Agent assumes responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
SECTION 905. May Hold Securities.
Each of the Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to
Sections 908 and 913, may otherwise deal with the Company with the same rights
it would have if it were not the Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.
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SECTION 906. 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
expressly provided herein or otherwise agreed with, and for the sole benefit of,
the Company.
SECTION 907. Compensation and Reimbursement.
The Company shall
(a) pay to the Trustee from time to time such compensation as shall be
agreed to in writing between the Company and 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, reimburse the Trustee
upon its request for all reasonable expenses, disbursements and advances
reasonably 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 to the extent that any such
expense, disbursement or advance may be attributable to the Trustee's
negligence, wilful misconduct or bad faith; and
(c) indemnify the Trustee for, and hold it harmless from and against, any
and all loss, damage, claim, liability or expense including taxes (other than
taxes based on the income of the Trustee) reasonably incurred by it and arising
out of or in connection with the acceptance or administration of the trust or
trusts hereunder or the performance of its duties 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,
except to the extent any such loss, liability or expense may be attributable to
its negligence, wilful misconduct or bad faith.
As security for the performance of the obligations of the Company under
this Section, the Trustee shall have a lien prior to the Securities upon all
property and funds held or collected by the Trustee as such, other than property
and funds held in trust under Section 703 (except as otherwise provided in
Section 703). "Trustee" for purposes of this Section shall include any
predecessor Trustee; provided, however, that the negligence, wilful misconduct
or bad faith of any Trustee hereunder shall not affect the rights of any other
Trustee hereunder.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 801(d) or
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Section 801(e), 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.
The provisions of this Section shall survive the termination of this
Indenture.
SECTION 908. Disqualification; Conflicting Interests.
If the Trustee shall have or acquire any conflicting interest within the
meaning of the Trust Indenture Act, it shall either eliminate such conflicting
interest or resign to the extent, in the manner and with the effect, and subject
to the conditions, provided in the Trust Indenture Act and this Indenture. For
purposes of Section 310(b)(1) of the Trust Indenture Act and to the extent
permitted thereby, the Trustee, in its capacity as trustee in respect of the
Securities of any series, shall not be deemed to have a conflicting interest
arising from its capacity as trustee in respect of the Securities of any other
series.
SECTION 909. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder, which shall be
(a) a corporation organized and doing business under the laws of the United
States of America, any State or Territory thereof or the District of Columbia,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by Federal or State authority, or
(b) if and to the extent permitted by the Commission by rule, regulation or
order upon application, a corporation or other Person organized and doing
business under the laws of a foreign government, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 or the Dollar equivalent of the applicable foreign currency
and subject to supervision or examination by authority of such foreign
government or a political subdivision thereof substantially equivalent to
supervision or examination applicable to United States institutional trustees,
and, in either case, qualified and eligible under this Article and the Trust
Indenture Act. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of such supervising or
examining authority, then, for the purposes of this Section, the combined
capital and surplus of such
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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.
SECTION 910. 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 shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 911.
(b) The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 911 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 with respect to the
Securities of such series.
(c) The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 908 after written
request therefor by the Company or by any Holder who has been a bona fide Holder
for at least six (6) months, or
(2) the Trustee shall cease to be eligible under Section 909 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(3) 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, (x) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (y) subject to Section 814, any
Holder who has been a bona fide Holder for at least six (6) 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.
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(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 (other than
as contemplated in clause (y) in subsection (d) of this Section), with respect
to the Securities of one or more series, the Company, by a Board Resolution,
shall promptly appoint a successor Trustee or Trustees with respect to the
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and that at any time there shall be only one Trustee with respect to
the Securities of any particular series) and shall comply with the applicable
requirements of Section 911. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 911, become the successor
Trustee with respect to the Securities of such series and to that extent
supersede the successor Trustee appointed by the Company. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Company or the Holders and accepted appointment in the manner
required by Section 911, any Holder who has been a bona fide Holder of a
Security of such series for at least six (6) months may, on behalf of such
Holder and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities of such series.
(f) So long as no Event of Default or event that is, or after notice or
lapse of time, or both, would become, an Event of Default shall have occurred
and be continuing, if the Company shall have delivered to the Trustee (i) a
Board Resolution appointing a successor Trustee, effective as of a date
specified therein, and (ii) an instrument of acceptance of such appointment,
effective as of such date, by such successor Trustee in accordance with Section
911, the Trustee shall be deemed to have resigned as contemplated in subsection
(b) of this Section, the successor Trustee shall be deemed to have been
appointed pursuant to subsection (e) of this Section, and such appointment shall
be deemed to have been accepted as contemplated in Section 911, all as of such
date, and all other provisions of this Section and Section 911 shall be
applicable to such resignation, appointment and acceptance except to the extent
inconsistent with this subsection (f).
(g) The Company shall give notice of each resignation and each removal of
the Trustee with respect to the Securities of any series and each appointment of
a successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to all
Holders of Securities of
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such series as their names and addresses appear in the Security Register. Each
notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its corporate trust office.
SECTION 911. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of all series, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company 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 the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of all sums owed to it, 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.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment, and which
supplemental indenture (1) 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 the Securities of that or those series to which the appointment of such
successor Trustee relates, (2) 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 the 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 (3) 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 of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein, and each such successor
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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 the Securities of that or those series to which the appointment of such
successor Trustee relates; but, on request of the Company or any successor
Trustee, such retiring Trustee, upon payment of all sums owed to it, shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall execute
any instruments that fully vest in and confirm to such successor Trustee all
such rights, powers and trusts referred to in subsection (a) or (b) of this
Section, 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.
SECTION 912. 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 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,
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 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 the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 913. Preferential Collection of Claims Against Company.
If the Trustee shall be or become a creditor of the Company or any other
obligor upon the Securities (other than by reason of a relationship described in
Section 311(b) of the Trust Indenture Act), the Trustee shall be subject to any
and all applicable provisions of the Trust Indenture Act regarding the
collection of claims against the Company or such other obligor. For purposes of
Section 311(b) of the Trust Indenture Act:
(a) the term "cash transaction" means any transaction in which full payment
for goods or securities sold is made within seven (7)
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days after delivery of the goods or securities in currency or in checks or other
orders drawn upon banks or bankers and payable upon demand;
(b) the term "self liquidating paper" means any draft, bill of exchange,
acceptance or obligation that is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase, processing, manufacturing,
shipment, storage or sale of goods, wares or merchandise and that is secured by
documents evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the security, provided the
security is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making, drawing,
negotiating or incurring of the draft, bill of exchange, acceptance or
obligation.
SECTION 914. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to
the Securities of one or more series who shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original
issuance and upon exchange, registration of transfer or partial redemption
thereof or pursuant to Section 306, 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. 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 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 the Company and shall at all times be a corporation organized and
doing business under the laws of the United States, any State or territory
thereof or the District of Columbia or the Commonwealth of Puerto Rico,
authorized under such laws to act as Authenticating Agent, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by Federal or State authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, 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. If at any time an Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
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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, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. 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, the Trustee may appoint a successor Authenticating
Agent that shall be acceptable to the Company. 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. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
The provisions of Sections 308, 904 and 905 shall be applicable to each
Authenticating Agent.
If an appointment with respect to the Securities of one or more series
shall be made pursuant to this Section, the Securities of such series may have
endorsed thereon, in addition to the Trustee's 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
If all of the Securities of a series may not be originally
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issued at one time, and if the Trustee does not have an office capable of
authenticating Securities upon original issuance located in a Place of Payment
where the Company wishes to have Securities of such series authenticated upon
original issuance, the Trustee, if so requested by the Company in writing (which
writing need not comply with Section 102 and need not be accompanied by an
Opinion of Counsel), shall appoint, in accordance with this Section and in
accordance with such procedures as shall be acceptable to the Trustee, an
Authenticating Agent having an office in a Place of Payment designated by the
Company with respect to such series of Securities.
ARTICLE TEN
Holders' Lists and Reports by Trustee and Company
SECTION 1001. Lists of Holders.
Semiannually, not later than June 30 and December 31 in each year,
commencing December 31, 1994, and at such other times as the Trustee may request
in writing, the Company shall furnish or cause to be furnished to the Trustee
information as to the names and addresses of the Holders, and the Trustee shall
preserve such information and similar information received by it in any other
capacity and afford to the Holders access to information so preserved by it, all
to such extent, if any, and in such manner as shall be required by the Trust
Indenture Act; provided, however, that no such list need be furnished so long as
the Trustee shall be the Security Registrar.
SECTION 1002. Reports by Trustee and Company.
Not later than June 15 in each year commencing with the year 1995, the
Trustee shall transmit to the Holders and the Commission a report with respect
to any events and other matters described in Section 313(a) of the Trust
Indenture Act that may have occurred within the twelve months preceding April 15
of such year, in such manner and to the extent required by the Trust Indenture
Act. A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange, if any, upon which
the Securities are listed, with the Commission and with the Company. The
Company will promptly notify the Trustee when the Securities are listed on any
stock exchange. The Trustee shall transmit to the Holders and the Commission,
and the Company shall file with the Trustee (within fifteen (15) days after
filing with the Commission in the case of reports that pursuant to the Trust
Indenture Act must be filed with the Commission and furnished to the Trustee)
and transmit to the Holders, such other information, reports and other
documents, if any, at such times and in such manner, as shall be required by the
Trust Indenture Act and the Exchange Act.
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Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officer's Certificates).
ARTICLE ELEVEN
Consolidation, Merger, Conveyance or Other Transfer
SECTION 1101. Company May Consolidate, etc., Only on
Certain Terms.
The Company shall not consolidate with or merge into any other corporation,
or convey or otherwise transfer or lease its properties and assets substantially
as an entirety to any Person, unless
(a) the corporation formed by such consolidation or into which the Company
is merged, or the Person that acquires by conveyance or transfer, or that
leases, the properties and assets of the Company substantially as an entirety,
shall be a Person organized and existing under the laws of the United States of
America, any State thereof or the District of Columbia, and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual payment of
the principal of and premium, if any, and interest, if any, on all Outstanding
Securities and the performance of every covenant of this Indenture on the part
of the Company to be performed or observed;
(b) immediately after giving effect to such transaction and treating any
indebtedness for borrowed money that becomes an obligation of the Company as a
result of such transaction as having been incurred by the Company at the time of
such transaction, no Event of Default, and no event which, after notice or lapse
of time, or both, would become an Event of Default, shall have occurred and be
continuing; and
(c) the Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance or other transfer or lease, and such supplemental indenture,
comply with this Article and that all conditions precedent herein provided or
relating to such transactions have been complied with.
SECTION 1102. Successor Corporation Substituted.
Upon any consolidation by the Company with or merger by the
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Company into any other corporation, or any conveyance or other transfer or lease
of the properties and assets of the Company substantially as an entirety in
accordance with Section 1101, the successor corporation formed by such
consolidation or into which the Company is merged, or the Person to which such
conveyance, transfer or lease is made, shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture,
with the same effect as if such successor Person had been named as the Company
herein, and thereafter, except in the case of a lease, the predecessor Person
shall be relieved of all obligations and covenants under this Indenture and the
Securities Outstanding hereunder.
ARTICLE TWELVE
Supplemental Indentures
SECTION 1201. Supplemental Indentures without Consent
of Holders.
Without the consent of any Holders, the Company 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 the Company and the
assumption by any such successor of the covenants of the Company herein and in
the Securities, all as provided in Article Eleven; or
(b) to add one or more covenants of the Company or other provisions for the
benefit of all Holders, or for the benefit of the Holders of, or to remain in
effect only so long as there shall be Outstanding, Securities of one or more
specified series, or to surrender any right or power herein conferred upon the
Company; or
(c) to add any additional Events of Default with respect to all or any
series of Securities Outstanding hereunder; or
(d) to change or eliminate any provision of this Indenture or to add any
new provision to this Indenture; provided, however, that if such change,
elimination or addition shall adversely affect the interests of the Holders of
Securities of any series, such change, elimination or addition shall become
effective with respect to such series only when no Security of such series
remains Outstanding; or
(e) to provide collateral security for the Securities; or
(f) to establish the form or terms of Securities of any series as
contemplated by Sections 201 and 301; or
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(g) to evidence and provide for the acceptance of appointment hereunder by
a separate or successor Trustee with respect to the Securities of one or more
series, and to add to or change any of the provisions of this Indenture as shall
be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section
911(b); or
(h) to provide for the procedures required to permit the Company to
utilize, at its option, a noncertificated system of registration for all, or any
series of, the Securities; or
(i) to change any place or places where (1) the principal of and premium,
if any, and interest, if any, on all or any series of Securities shall be
payable, (2) all or any series of Securities may be surrendered for registration
of transfer, (3) all or any series of Securities may be surrendered for
exchange, and (4) notices and demands to or upon the Company in respect of all
or any series of Securities and this Indenture may be served; or
(j) to cure any ambiguity, to correct or supplement any provision herein
that may be defective or inconsistent with any other provision herein, or to
make any other changes to the provisions hereof, or to add other provisions with
respect to matters or questions arising under this Indenture, provided that such
other changes or additions shall not adversely affect the interests of the
Holders of Securities of any series.
Without limiting the generality of the foregoing, if the Trust Indenture
Act as in effect at the date of the execution and delivery of this Indenture or
at any time thereafter shall be amended and
(x) if any such amendment shall require one or more changes to any
provisions hereof or the inclusion herein of any additional provisions, or shall
by operation of law be deemed to effect such changes or incorporate such
provisions by reference or otherwise, this Indenture shall be deemed to have
been amended so as to conform to such amendment to the Trust Indenture Act, and
the Company and the Trustee may, without the consent of any Holders, enter into
an indenture supplemental hereto to effect or evidence such changes or
additional provisions; or
(y) if any such amendment shall permit one or more changes to, or the
elimination of, any provisions hereof that, at the date of the execution and
delivery hereof or at any time thereafter, are required by the Trust Indenture
Act to be contained herein, this Indenture shall be deemed to have been amended
to effect such changes or elimination, and the Company and the Trustee may,
without the consent of any Holders, enter into an indenture supplemental hereto
to evidence such amendment hereof.
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SECTION 1202. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Securities of all series then Outstanding under this
Indenture, considered as one class, by Act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by 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 modifying in any manner
the rights of the Holders of Securities of such series under the Indenture;
provided, however, that if there shall be Securities of more than one series
Outstanding hereunder, and if a proposed supplemental indenture shall directly
affect the rights of the Holders of Securities of one or more, but less than
all, of such series, then the consent only of the Holders of a majority in
aggregate principal amount of the Outstanding Securities of all series so
directly affected, considered as one class, shall be required; and provided,
further, that no such supplemental indenture shall
(a) change the Stated Maturity of the principal of, or any installment of
principal of or interest on (except as provided in Section 311 hereof), any
Security, or reduce the principal amount thereof or the rate of interest thereon
(or the amount of any installment of interest thereon) or the method of
calculating such rate, or change the redemption provisions thereof, or reduce
any premium payable upon the redemption thereof, or change the coin or currency
(or other property) 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 of any Security (or, in the case of
redemption, on or after the Redemption Date), without, in any such case, the
consent of the Holder of such Security, or
(b) reduce the percentage in principal amount of the Outstanding Securities
of any series the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is required for
any waiver of compliance with any provision of this Indenture or of any default
hereunder and its consequences, or reduce the requirements of Section 1304 for
quorum or voting, without, in any such case, the consent of the Holders of each
Outstanding Security of such series, or
(c) modify any of the provisions of this Section, Section 607 or Section
813, with respect to the Securities of any series, except to increase the
percentages in principal amount referred to in this Section or such other
Sections or to provide that other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each Outstanding
Security affected thereby; provided, however, that this clause shall not be
deemed to
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require the consent of any Holder with respect to changes in the references to
"the Trustee" and concomitant changes in this Section, or the deletion of this
proviso, in accordance with the requirements of Sections 911(b) and 1201(g), or
(d) modify the provisions of Section 1002 or Article Fifteen.
A supplemental indenture that changes or eliminates any covenant or other
provision of the Indenture that has expressly been included solely for the
benefit of one or more particular series of Securities, or that modifies the
rights of the holders of Securities of such series with respect to such
covenants or other provision, shall be deemed not to affect the rights under the
Indenture of the holders of Securities of any other series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 1203. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 901) 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 that affects the
Trustee's own rights, duties, immunities or liabilities under this Indenture or
otherwise.
SECTION 1204. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, 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
shall be bound thereby. Any supplemental indenture permitted by this Article may
restate this Indenture in its entirety, and, upon the execution and delivery
thereof, any such restatement shall supersede this Indenture as theretofore in
effect for all purposes.
SECTION 1205. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 1206. 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 the Company shall so determine,
new
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Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
SECTION 1207. Modification without Supplemental Indenture.
If the terms of any particular series of Securities shall have been
established in a Board Resolution or an Officer's Certificate as contemplated by
Section 301, and not in an indenture supplemental hereto, additions to, changes
in or the elimination of any of such terms may be effected by means of a
supplemental Board Resolution or Officer's Certificate, as the case may be,
delivered to, and accepted by, the Trustee; provided, however, that such
supplemental Board Resolution or Officer's Certificate shall not be accepted by
the Trustee or otherwise be effective unless all conditions set forth in this
Indenture that would be required to be satisfied if such additions, changes or
elimination were contained in a supplemental indenture shall have been
appropriately satisfied. Upon the acceptance thereof by the Trustee, any such
supplemental Board Resolution or Officer's Certificate shall be deemed to be a
"supplemental indenture" for purposes of Section 1204 and 1206.
ARTICLE THIRTEEN
Meetings of Holders; Action without Meeting
SECTION 1301. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities of one or more, or all, series may be
called at any time and from time to time pursuant to this Article 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 1302. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of Securities of
one or more, or all, series for any purpose specified in Section 1301, to be
held at such time and at such place in the Borough of Manhattan, the City of New
York, as the Trustee shall determine, or, with the approval of the Company, at
any other place. Notice of every such meeting, 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 twenty-one (21) nor more than one hundred eighty (180) days prior to the
date fixed for the meeting.
(b) If the Trustee shall have been requested to call a meeting of the
Holders of Securities of one or more, or all, series by the
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Company or by the Holders of 33% in aggregate principal amount of all of such
series, considered as one class, for any purpose specified in Section 1301, by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have given the notice of such
meeting within twenty-one (21) days after receipt of such request, or shall not
thereafter proceed to cause the meeting to be held as provided herein, then the
Company or the Holders of Securities of such series in the amount above
specified, as the case may be, may determine the time and the place in the
Borough of Manhattan, the City of New York, or in such other place as shall be
determined or approved by the Company, for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in subsection (a)
of this Section.
(c) Any meeting of Holders of Securities of one or more, or all, series
shall be valid without notice if the Holders of all Outstanding Securities of
such series are present in person or by proxy and if representatives of the
Company and the Trustee are present, or if notice is waived in writing before or
after the meeting by the Holders of all Outstanding Securities of such series,
or by such of them as are not present at the meeting in person or by proxy, and
by the Company and the Trustee.
SECTION 1303. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities of one or
more, or all, 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
attend 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 the Company and its counsel.
SECTION 1304. Quorum; Action.
The Persons entitled to vote a majority in aggregate principal amount of
the Outstanding Securities of the series with respect to which a meeting shall
have been called as hereinbefore provided, considered as one class, 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 meeting that this
Indenture expressly provides may be taken by the Holders of a specified
percentage, which is less than a majority, in principal amount of the
Outstanding Securities of such series, considered as one class, the Persons
entitled to vote such specified percentage in principal amount of the
Outstanding Securities of such series, considered as one class, shall constitute
a quorum. In the absence of a quorum
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within one hour of 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 such period as
may be determined by the chairman of the meeting prior to the adjournment of
such meeting. In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for such period as may be determined
by the chairman of the meeting prior to the adjournment of such adjourned
meeting. Except as provided by Section 1305(e), notice of the reconvening of any
meeting adjourned for more than thirty (30) days shall be given as provided in
Section 1302(a) not less than ten (10) days prior to the date on which the
meeting is scheduled to be reconvened. Notice of the reconvening of an adjourned
meeting shall state expressly the percentage, as provided above, of the
principal amount of the Outstanding Securities of such series that shall
constitute a quorum.
Except as limited by Section 1202, any resolution presented to a meeting or
adjourned meeting duly reconvened at which a quorum is present as aforesaid may
be adopted only by the affirmative vote of the Holders of a majority in
aggregate principal amount of the Outstanding Securities of the series with
respect to which such meeting shall have been called, considered as one class;
provided, however, that, except as so limited, any resolution with respect to
any action that this Indenture expressly provides may be taken by the Holders of
a specified percentage, which is less than a majority, in principal amount of
the Outstanding Securities of such series, considered as one class, may be
adopted at a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding Securities of such
series, considered as one class.
Any resolution passed or decision taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities of the series with respect to which such meeting shall
have been held, whether or not present or represented at the meeting.
SECTION 1305. Attendance at Meetings;
Determination of Voting Rights; Conduct and Adjournment
of Meetings.
(a) Attendance at meetings of Holders of Securities may be in person or by
proxy; and, to the extent permitted by law, any such proxy shall remain in
effect and be binding upon any future Holder of the Securities with respect to
which it was given, unless and until specifically revoked by the Holder or
future Holder of such Securities before being voted.
(b) Notwithstanding any other provisions of this Indenture,
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the Trustee may make such reasonable regulations as it may deem advisable for
any meeting of Holders of Securities in regard to proof of the holding of such
Securities 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.
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.
(c) The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders as provided in Section 1302(b), in which case the Company
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 aggregate principal amount of the Outstanding
Securities of all series represented at the meeting, considered as one class.
(d) At any meeting each Holder or proxy shall be entitled to one vote for
each $25 principal amount of Securities 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 or proxy.
(e) Any meeting duly called pursuant to Section 1302 at which a quorum is
present may be adjourned from time to time by Persons entitled to vote a
majority in aggregate principal amount of the Outstanding Securities of all
series represented at the meeting, considered as one class; and the meeting may
be held as so adjourned without further notice.
SECTION 1306. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders shall be
by written ballots on which shall be subscribed the signatures of the Holders or
of their representatives by proxy and the principal amounts and serial numbers
of the Outstanding Securities, of the series with respect to which the meeting
shall have been called, 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
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resolution and who shall make and file with the secretary of the meeting their
verified written reports of all votes cast at the meeting. A record of the
proceedings of each meeting of Holders 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 facts setting forth a copy of the notice of
the meeting and showing that said notice was given as provided in Section 1302
and, if applicable, Section 1304. 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 the Company, 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.
SECTION 1307. Action without Meeting.
In lieu of a vote of Holders at a meeting as hereinbefore contemplated in
this Article, any request, demand, authorization, direction, notice, consent,
waiver or other action may be made, given or taken by Holders by written
instruments as provided in Section 104.
ARTICLE FOURTEEN
Immunity of Incorporators,
Stockholders, Officers and Directors
SECTION 1401. Liability Solely Corporate.
No recourse shall be had for the payment of the principal of or premium, if
any, or interest, if any, on any Securities, or any part thereof, or for any
claim based thereon or otherwise in respect thereof, or of the indebtedness
represented thereby, or upon any obligation, covenant or agreement under this
Indenture, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Company or of any predecessor or successor
corporation (either directly or through the Company or a predecessor or
successor corporation), whether by virtue of any constitutional provision,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly agreed and understood that this Indenture and all
the Securities are solely corporate obligations, and that no personal liability
whatsoever shall attach to, or be incurred by, any incorporator, stockholder,
officer or director, past, present or future, of the Company or of any
predecessor or successor corporation, either directly or indirectly through the
Company or any predecessor or successor corporation, because of the indebtedness
hereby authorized, or under or by reason of any of the
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obligations, covenants or agreements contained in this Indenture or in any of
the Securities, or to be implied herefrom or therefrom, and that any such
personal liability is hereby expressly waived and released as a condition of and
as part of the consideration for, the execution of this Indenture and the
issuance of the Securities.
ARTICLE FIFTEEN
Subordination of Securities
SECTION 1501. Securities Subordinate to Senior Indebtedness.
The Company, for itself, its successors and assigns, covenants and agrees,
and each Holder of the Securities of each series, by its acceptance thereof,
likewise covenants and agrees, that the payment of the principal of and premium,
if any, and interest, if any, on each and all of the Securities is hereby
expressly subordinated, to the extent and in the manner set forth in this
Article, in right of payment to the prior payment of all Senior Indebtedness,
and senior in right of payment to all preferred and common stock of the Company.
Each Holder of the Securities of each series, by its acceptance thereof,
authorizes and directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article, and appoints the Trustee its attorney-in-fact for any and all such
purposes.
SECTION 1502. Payment Over of Proceeds of Securities.
In the event (a) of any insolvency or bankruptcy proceedings or any
receivership, liquidation, reorganization or other similar proceedings in
respect of the Company or a substantial part of its property, or of any
proceedings for liquidation, dissolution or other winding up of the Company,
whether or not involving insolvency or bankruptcy, or (b) subject to the
provisions of Section 1503, that (i) a default shall have occurred with respect
to the payment of principal of or interest on or other monetary amounts due and
payable on any Senior Indebtedness, or (ii) there shall have occurred a default
(other than a default in the payment of principal or interest or other monetary
amounts due and payable) in respect of any Senior Indebtedness, as defined
therein or in the instrument under which the same is outstanding, permitting the
holder or holders thereof to accelerate the maturity thereof (with notice or
lapse of time, or both), and such default shall have continued beyond the period
of grace, if any, in respect thereof, and, in the cases of subclauses (i) and
(ii) of this clause (b), such default shall not have been cured or waived or
shall not have ceased to exist, or (c) that the principal of and accrued
interest
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on the Securities of any series shall have been declared due and payable
pursuant to Section 801 and such declaration shall not have been rescinded and
annulled as provided in Section 802, then:
(1) the holders of all Senior Indebtedness shall first be entitled to
receive payment of the full amount due thereon, or provision shall be made for
such payment in money or money's worth, before the Holders of any of the
Securities are entitled to receive a payment on account of the principal of or
interest on the indebtedness evidenced by the Securities, including, without
limitation, any payments made pursuant to Articles Four and Five;
(2) any payment by, or distribution of assets of, the Company of any kind
or character, whether in cash, property or securities, to which any Holder or
the Trustee would be entitled except for the provisions of this Article, shall
be paid or delivered by the person making such payment or distribution, whether
a trustee in bankruptcy, a receiver or liquidating trustee or otherwise,
directly to the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under which
any instruments evidencing any of such Senior Indebtedness may have been issued,
ratably according to the aggregate amounts remaining unpaid on account of such
Senior Indebtedness held or represented by each, to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid after giving effect
to any concurrent payment or distribution (or provision therefor) to the holders
of such Senior Indebtedness, before any payment or distribution is made to the
Holders of the indebtedness evidenced by the Securities or to the Trustee under
this Indenture; and
(3) in the event that, notwithstanding the foregoing, any payment by, or
distribution of assets of, the Company of any kind or character, whether in
cash, property or securities, in respect of principal of or interest on the
Securities or in connection with any repurchase by the Company of the
Securities, shall be received by the Trustee or any Holder before all Senior
Indebtedness is paid in full, or provision is made for such payment in money or
money's worth, such payment or distribution in respect of principal of or
interest on the Securities or in connection with any repurchase by the Company
of the Securities shall be paid over to the holders of such Senior Indebtedness
or their representative or representatives or to the trustee or trustees under
any indenture under which any instruments evidencing any such Senior
Indebtedness may have been issued, ratably as aforesaid, for application to the
payment of all Senior Indebtedness remaining unpaid, until all such Senior
Indebtedness shall have been paid in full, after giving effect to any concurrent
payment or distribution (or provision therefor) to the holders of such Senior
Indebtedness.
Notwithstanding the foregoing, at any time after the 123rd day following
the date of deposit of cash or Government Obligations
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pursuant to Section 701 (provided all conditions set out in such Section shall
have been satisfied), the funds so deposited and any interest thereon will not
be subject to any rights of holders of Senior Indebtedness including, without
limitation, those arising under this Article Fifteen; provided that no event
described in clauses (d) and (e) of Section 801 with respect to the Company has
occurred during such 123-day period.
For purposes of this Article only, the words "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment that are subordinate in right of
payment to all Senior Indebtedness that may at the time be outstanding to the
same extent as, or to a greater extent than, the Securities are so subordinated
as provided in this Article. The consolidation of the Company with, or the
merger of the Company into, another corporation, or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon the
terms and conditions provided for in Article Eleven hereof, shall not be deemed
a dissolution, winding-up, liquidation or reorganization for the purposes of
this Section 1502 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article Eleven hereof. Nothing in Section 1501 or in this Section 1502 shall
apply to claims of, or payments to, the Trustee under or pursuant to Section
907.
SECTION 1503. Disputes with Holders of Certain
Senior Indebtedness.
Any failure by the Company to make any payment on or perform any other
obligation in respect of Senior Indebtedness, other than any indebtedness
incurred by the Company or assumed or guaranteed, directly or indirectly, by the
Company for money borrowed (or any deferral, renewal, extension or refunding
thereof) or any other obligation as to which the provisions of this Section
shall have been waived by the Company in the instrument or instruments by which
the Company incurred, assumed, guaranteed or otherwise created such indebtedness
or obligation, shall not be deemed a default under clause (b) of Section 1502 if
(i) the Company shall be disputing its obligation to make such payment or
perform such obligation and (ii) either (A) no final judgment relating to such
dispute shall have been issued against the Company that is in full force and
effect and is not subject to further review, including a judgment that has
become final by reason of the expiration of the time within which a party may
seek further appeal or review, or (B) in the event that a judgment that is
subject to further review or appeal has been issued, the Company shall in good
faith be prosecuting an appeal or other proceeding for review and a stay or
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execution shall have been obtained pending such appeal or review.
SECTION 1504. Subrogation.
Senior Indebtedness shall not be deemed to have been paid in full unless
the holders thereof shall have received cash (or securities or other property
satisfactory to such holders) in full payment of such Senior Indebtedness then
outstanding. Upon the payment in full of all Senior Indebtedness, the Holders of
the Securities shall be subrogated to the rights of the holders of Senior
Indebtedness to receive any further payments or distributions of cash, property
or securities of the Company applicable to the holders of the Senior
Indebtedness, until all amounts owing on the Securities shall be paid in full;
and such payments or distributions of cash, property or securities received by
the Holders of the Securities, by reason of such subrogation, which otherwise
would be paid or distributed to the holders of such Senior Indebtedness shall,
as between the Company, its creditors other than the holders of Senior
Indebtedness, and the Holders, be deemed to be a payment by the Company to or on
account of Senior Indebtedness, it being understood that the provisions of this
Article are and are intended solely for the purpose of defining the relative
rights of the Holders, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
If any payment or distribution to which the Holders would otherwise have
been entitled but for the provisions of this Article shall have been applied,
pursuant to this Article, to the payment of all Senior Indebtedness, then and in
such case the Holders shall be entitled to receive from the holders of such
Senior Indebtedness at the time outstanding any payments or distributions
received by such holders of Senior Indebtedness in excess of the amount
sufficient to pay, in cash or cash equivalents, all such Senior Indebtedness in
full.
SECTION 1505. Obligation of the Company Unconditional.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among the Company, its creditors
other than the holders of Senior Indebtedness and the Holders, the obligation of
the Company, which is absolute and unconditional, to pay to the Holders the
principal of and interest on the Securities as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the Holders and creditors of the Company other
than the holders of Senior Indebtedness, nor shall anything herein or therein
prevent the Trustee or any Holder from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article of the holders of Senior Indebtedness in
respect of cash, property or securities of the Company received upon the
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exercise of any such remedy.
Upon any payment or distribution of assets or securities of the Company
referred to in this Article, the Trustee and the Holders shall be entitled to
rely upon any order or decree of a court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are pending
for the purpose of ascertaining the persons entitled to participate in such
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon, and all other facts pertinent thereto or to this
Article.
SECTION 1506. Priority of Senior Indebtedness Upon Maturity.
Upon the maturity of the principal of any Senior Indebtedness by lapse of
time, acceleration or otherwise, all matured principal of Senior Indebtedness
and interest and premium, if any, thereon shall first be paid in full before any
payment of principal or premium or interest, if any, is made upon the Securities
or before any Securities can be acquired by the Company or any sinking fund
payment is made with respect to the Securities (except that required sinking
fund payments may be reduced by Securities acquired before such maturity of such
Senior Indebtedness).
SECTION 1507. Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights
The Trustee shall be entitled to all rights set forth in this Article with
respect to any Senior Indebtedness at any time held by it, to the same extent as
any other holder of Senior Indebtedness. Nothing in this Article shall deprive
the Trustee of any of its rights as such holder. Nothing in this Article
Fifteen shall apply to claims of, or payments to, the Trustee under or pursuant
to Section 907.
SECTION 1508. Notice to Trustee to Effectuate Subordination.
The Company shall given prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities. Failure to give such notice shall not
affect the subordination of the Securities to Senior Indebtedness.
Notwithstanding the provisions of this Article or any other provision of the
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of moneys to or by the
Trustee, unless and until the Trustee shall have received written notice thereof
from the Company, from a Holder or from a holder of any Senior Indebtedness or
from any representative
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or representatives of such holder; and, prior to the receipt of any such written
notice, the Trustee shall be entitled, subject to Section 901, in all respects
to assume that no such facts exist; provided, however, that, if prior to the
fifth Business Day preceding the date upon which by the terms hereof any such
moneys may become payable for any purpose, or, in the event of the execution of
an instrument pursuant to Section 702 acknowledging satisfaction and discharge
of this Indenture, then if prior to the second Business Day preceding the date
of such execution, the Trustee shall not have received with respect to such
moneys the notice provided for in this Section, then, anything herein contained
to the contrary notwithstanding, the Trustee may, in its discretion, receive
such moneys and/or apply the same to the purpose for which they were received,
and shall not be affected by any notice to the contrary that may be received by
it on or after such date; provided, however, that no such application shall
affect the obligations under this Article of the persons receiving such moneys
from the Trustee.
The Trustee shall be entitled to rely on the delivery to it of a written
notice by a person representing himself to be a holder of Senior Indebtedness
(or a trustee or agent on behalf of such holder) to establish that such notice
has been given by a holder of Senior Indebtedness (or a trustee or agent on
behalf of such holder). In the event that the Trustee determines in good faith
that further evidence is required with respect to the right of any person as a
holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article Fifteen, the Trustee may request such person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such person, the extent to which such person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such person under this Article Fifteen, and if such
evidence is not furnished, the Trustee may defer any payment which it may be
required to make for the benefit of such person pursuant to the terms of this
Indenture pending judicial determination as to the rights of such person to
receive such payment.
Upon any payment or distribution of assets of the Company referred to in
this Article Fifteen, the Trustee and the Holders of the Securities shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to the
Holders of Securities, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Fifteen.
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SECTION 1509. Modification, Extension, etc. of
Senior Indebtedness.
The holders of Senior Indebtedness may, without affecting in any manner the
subordination of the payment of the principal of and premium, if any, and
interest, if any, on the Securities, at any time or from time to time and in
their absolute discretion, agree with the Company to change the manner, place or
terms of payment, change or extend the time of payment of, or renew or alter,
any Senior Indebtedness, or amend or supplement any instrument pursuant to which
any Senior Indebtedness is issued, or exercise or refrain from exercising any
other of their rights under the Senior Indebtedness including, without
limitation, the waiver of default thereunder, all without notice to or assent
from the Holders or the Trustee.
SECTION 1510. Trustee Has No Fiduciary Duty to Holders
of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and objectives as are
specifically set forth in this Indenture, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if it shall mistakenly pay over or deliver to the
Holders, or the Company or any other Person, money or assets to which any
holders of Senior Indebtedness shall be entitled by virtue of this Article or
otherwise.
SECTION 1511. Paying Agents Other Than the Trustee.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context shall otherwise
require) be construed as extending to and including such Paying Agent within its
meaning as fully for all intents and purposes as if such Paying Agent were named
in this Article in addition to or in place of the Trustee; provided, however,
that Sections 1507, 1508 and 1510 shall not apply to the Company if it acts as
Paying Agent.
SECTION 1512. Rights of Holders of Senior Indebtedness
Not Impaired.
No right of any present or future holder of Senior Indebtedness to enforce
the subordination herein shall at any time
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or in any way be prejudiced or impaired by any act or failure to act on the part
of the Company or by any noncompliance by the Company with the terms, provisions
and covenants of this Indenture, regardless of any knowledge thereof any such
holder may have or be otherwise charged with.
SECTION 1513. Effect of Subordination Provisions; Termination.
Notwithstanding anything contained herein to the contrary, other than as
provided in the immediately succeeding sentence, all the provisions of this
Indenture shall be subject to the provisions of this Article, so far as the same
may be applicable thereto.
Notwithstanding anything contained herein to the contrary, the provisions
of this Article Fifteen shall be of no further effect, and the Securities shall
no longer be subordinated in right of payment to the prior payment of Senior
Indebtedness, if the Company shall have delivered to the Trustee a notice to
such effect. Any such notice delivered by the Company shall not be deemed to be
a supplemental indenture for purposes of Article Twelve hereof.
----------------------------------------
This instrument 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 instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.
THE UNITED ILLUMINATING COMPANY
By: ___________________________
THE BANK OF NEW YORK, as Trustee
By: ____________________________
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EXHIBIT 4(F)
[SUPPLEMENTAL INDENTURE ESTABLISHING DEBENTURES CORRESPONDING TO
PREFERRED CAPITAL SECURITIES]
THE UNITED ILLUMINATING COMPANY
and
THE BANK OF NEW YORK,
Trustee
-------------------
[_____] SUPPLEMENTAL INDENTURE
Dated as of [_____]
to
INDENTURE
Dated as of [_____], 1994
-------------------
[__]% Junior Subordinated Deferrable Interest Debentures, Series [__],
Due [_____]
<PAGE>
[_____] SUPPLEMENTAL INDENTURE dated as of [_____] (this "Supplemental
Indenture") between THE UNITED ILLUMINATING COMPANY, a corporation duly
organized and existing under the laws of the State of Connecticut (the
"Company"), and THE BANK OF NEW YORK, a New York banking corporation organized
and existing under the laws of the State of New York, as trustee (the "Trustee")
under the Indenture dated as of [_____], 1994 between the Company and the
Trustee (as such Indenture may heretofore have been amended and supplemented,
the "Indenture"). Capitalized terms used and not defined herein are used as
defined in the Indenture.
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide for the future issuance of Securities, to be issued from
time to time in one or more series as might be determined by the Company
under the Indenture, in an unlimited aggregate principal amount that may be
authenticated and delivered thereunder as in the Indenture provided;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a new series of Securities to
be known as its [__]% Junior Subordinated Deferrable Interest Debentures,
Series [__], Due [_____] (the "Debentures"), the form and substance
thereof, and the terms, provisions and conditions thereof, to be set forth
as provided in the Indenture and this Supplemental Indenture;
WHEREAS, United Capital Funding Partnership L.P., a Delaware
limited partnership (such limited partnership, or its permitted successors,
the "Partnership"), desires to offer and sell its [__]% Preferred Capital
Securities, Series [__] (the "Preferred Securities"), representing limited
partner interests in the Partnership ("Limited Partner Interests"), in
accordance with the Action of General Partner dated [_____] pursuant to
Section 10.2(a) of the Amended and Restated Agreement of Limited
Partnership of the Partnership dated [_____], 1994 (as amended and
supplemented by any such Action, the "Partnership Agreement");
WHEREAS, the Partnership desires to invest the proceeds from the
offer and sale of the Preferred Securities, together with the amount of
capital contributions made by the Company from time to time as general
partner of the Partnership in connection with the Preferred Securities, in
the Debentures;
WHEREAS, the Company has entered into a Payment and Guarantee
Agreement dated as of [_____], 1994 pursuant to which, among other things,
payments of dividends on, and upon redemption of, the Preferred Securities
and upon liquidation of the Partnership are guaranteed to the extent set
forth therein (the "Guarantee");
<PAGE>
WHEREAS, upon the occurrence of any Special Event (as defined in
the Partnership Agreement), the Company may cause to be distributed to the
holders of the Preferred Securities, on a pro rata basis, Debentures (a
"Distribution Event"); and
WHEREAS, the Company desires and has requested the Trustee to
join with it in the execution and delivery of this Supplemental Indenture
and all requirements necessary to make this Supplemental Indenture a valid
instrument, in accordance with its terms, and to make the Debentures, when
executed by the Company and authenticated and delivered by the Trustee, the
valid obligations of the Company, have been performed and fulfilled, and
the execution and delivery hereof have been in all respects duly
authorized.
NOW, THEREFORE, in consideration of the purchase and acceptance of the
Debentures by the Partnership, and for the purpose of setting forth, as provided
in the Indenture, the form and substance of the Debentures and the terms,
provisions and conditions thereof, the Company covenants and agrees with the
Trustee as follows:
ARTICLE ONE
General Terms and Conditions of the Debentures
----------------------------------------------
SECTION 1.01. There shall be and is hereby authorized a series of
Securities designated the "[__]% Junior Subordinated Deferrable Interest
Debentures, Series [__], Due [_____]," the aggregate principal amount of which
shall be limited to the sum of (a) $[_____] and (b) the amount of capital
contributions made by the Company from time to time as general partner of the
Partnership in connection with the Preferred Securities, which amount shall be
as set forth in any written order of the Company for the authentication and
delivery of Debentures; provided, however, that the Debentures shall be issued
to evidence loans by the Partnership of the proceeds of the issuance of the
Preferred Securities plus the amount of such capital contributions. Debentures
may, upon execution of this Supplemental Indenture or from time to time
thereafter, be executed by the Company and delivered to the Trustee for
authentication, and the Trustee shall thereupon authenticate and deliver such
Debentures to or upon the written order of the Company, signed by its Chairman,
its President, or any Vice President and its Treasurer or an Assistant
Treasurer, without any further action by the Company. The Debentures shall
mature and the principal thereof shall be due and payable together with all
accrued and unpaid interest (including Additional Interest (as defined in
Section 1.04(c) hereof), if any) thereon, on [_____], and shall be issued in the
form of registered Debentures without coupons.
SECTION 1.02. Except as provided in Section 1.03 hereof, the
Debentures shall be issued in certificated form. Principal of and premium, if
any, and interest (including Additional Interest, if any) on the Debentures
issued in certificated form will be payable, the transfer of Debentures will be
registrable, and Debentures will be exchangeable for Debentures bearing
identical terms and provisions, at the office or agency of the Company in the
Borough of Manhattan, the City of New York, in any coin or currency of the
United States of America that at the time of payment is legal tender for payment
of public and private debts; provided,
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however, that payment of interest on any of the Debentures may be made at the
option of the Company by check mailed to the Holder thereof at such address as
shall appear in the Security Register. Notwithstanding the foregoing, so long
as the Holder of the Debentures is the Partnership, the payment of the principal
of and premium, if any, and interest (including Additional Interest, if any) on
the Debentures will be made at such place and to such account as may be
designated in writing by the Partnership.
SECTION 1.03. (a) In connection with a Distribution Event, the
Debentures to be distributed to the holders of the Preferred Securities may be
presented to the Trustee by the Partnership in exchange for a Debenture in
global form (a "Global Debenture") in an aggregate principal amount equal to the
principal amount of such Debentures, to be registered in the name of The
Depository Trust Company, New York, New York or any successor registered as a
clearing agency under the Exchange Act or other applicable statute or regulation
(the "Depositary"), or its nominee, and delivered by the Trustee to the
Depositary for crediting to the accounts of its participants pursuant to the
instructions of the Partnership. The Company upon any such presentation shall
execute a Global Debenture in such aggregate principal amount and deliver the
same to the Trustee for authentication and delivery as hereinabove and in the
Indenture provided. Payments on such Debentures issued as a Global Debenture
will be made to the Depositary.
(b) Notwithstanding the provisions of Section 3.05 of the Indenture,
the Global Debenture may be transferred, in whole but not in part, in the manner
provided in Section 3.05 of the Indenture, only by the Depositary to a nominee
of the Depositary, by a nominee of the Depositary to the Depositary or to
another nominee of the Depositary, or to a successor Depositary selected or
approved by the Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for the Debentures or if at any
time the Depositary for the Debentures shall no longer be registered under the
Exchange Act, or other applicable statute or regulation, and a successor
Depositary for the Debentures is not appointed by the Company within 90 days
after the Company receives such notice or becomes aware of such condition, as
the case may be, this Section 1.03 shall no longer be applicable to the
Debentures and the Company will execute and, subject to Section 3.05 of the
Indenture, the Trustee will authenticate and deliver Debentures in definitive
registered form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Debenture
in exchange for such Global Debenture. In addition, the Company may at any time
determine that the Debentures shall no longer be represented by a Global
Debenture, and that the provisions of this Section 1.03 shall no longer apply to
the Debentures. In such event, the Company will execute and, subject to Section
3.05 of the Indenture, the Trustee, upon receipt of an Officer's Certificate
evidencing such determination by the Company, will authenticate and deliver
Debentures in definitive registered form without coupons, in authorized
denominations, and in aggregate principal amount equal to the principal amount
of the Global Debenture in exchange for such Global Debenture. Upon exchange of
the Global Debenture for such Debentures in definitive registered form without
coupons, in authorized denominations, the Global Debenture shall be canceled by
the Trustee. Such Debentures in definitive registered form issued in exchange
for the Global Debenture pursuant to this Section 1.03(c) shall be registered in
such names and authorized denominations as the Depositary, pursuant to
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instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Debentures to the
Depositary for delivery to the persons in whose names such Debentures are so
registered.
SECTION 1.04. (a) Each Debenture will bear interest at the rate of
[__]% per annum from its original date of issuance or from the most recent
Interest Payment Date (as defined below) to which interest has been paid or duly
provided for until the principal thereof becomes due and payable, and any
overdue principal thereof and (to the extent that payment of such interest is
enforceable under applicable law) any overdue installment of interest (including
Additional Interest, if any) thereon will bear interest at the same rate per
annum, payable in arrears on the last day of each calendar month of each year
(each, an "Interest Payment Date"), commencing on [_____], and at Maturity to
the person in whose name such Debenture or any Predecessor Security thereof is
registered, at the close of business on the Regular Record Date for such
interest installment, which shall be the close of business on the Business Day
next preceding such Interest Payment Date; provided, however, that, if the
Debentures are not solely held by the Partnership or the Depositary, the Company
may select a Regular Record Date for such interest installment that shall be any
date not more than 15 days preceding an Interest Payment Date; provided further,
however, that (i) if any Debenture is authenticated after a Regular Record Date
and before the Interest Payment Date therefor, such interest installment shall
be paid on the next succeeding Interest Payment Date to the Holder thereof on
the Regular Record Date therefor and (ii) interest payable at Maturity shall be
paid to the Person to whom principal is paid. Any such interest installment not
punctually paid or duly provided for shall forthwith cease to be payable to such
Holder on such Regular Record Date by virtue of having been such Holder, and
such defaulted interest may be paid by the Company, at its election, to the
person in whose name such Debenture (or one or more Predecessor Securities
thereof) is registered at the close of business on a Special Record Date to be
fixed by the Trustee for the payment of such defaulted interest, notice whereof
shall be given to the Holders of the Debentures not less than 10 days prior to
such Special Record Date, or in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Debentures may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture.
(b) So long as any Preferred Securities remain outstanding, if the
Partnership shall be required to pay (i) as an additional dividend on or
distribution with respect to any Limited Partner Interests, any amounts for or
on account of any present or future taxes, duties, assessments or governmental
charges of whatever nature imposed or levied upon or as a result of payments in
respect of any Limited Partner Interests by or on behalf of the United States,
any state thereof or any other jurisdiction through which or from which such
payments are made, or any authority therein or thereof having power to tax, that
have been withheld or deducted from the distributions to the holders of the
Limited Partner Interests or (ii) with respect to its income derived from the
interest payments on the Securities of any series corresponding to Limited
Partner Interests, any amounts for or on account of any taxes, duties,
assessments or governmental charges of whatever nature (other than withholding
taxes) imposed by the United States, or any other taxing authority, then, in any
such case, the Company will pay as interest on such series such additional
interest ("Additional Interest") as may be necessary so that the net amounts
received and retained by (A) the holders of the Preferred Securities after any
such taxes, duties, assessments or governmental charges shall have been withheld
or deducted shall
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<PAGE>
result in such holders having received such funds as they would have had in the
absence of such withholding or deduction and (B) the Partnership after paying
any such taxes, duties, assessments or governmental charges shall result in the
Partnership having such funds as it would have had in the absence of the payment
of such taxes, duties, assessments or governmental charges.
(c) The provisions of Section 113 of the Indenture shall apply to the
Debentures, except that, if any Business Day referred to therein is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day.
SECTION 1.05. "Business Day" for purposes of the Debentures shall
mean any day on which banking institutions in the City of New York, New York or
the City of New Haven, Connecticut are authorized or required by law to close.
SECTION 1.06. Notwithstanding the provisions of Section 101 and
Article Fifteen of the Indenture, the Company's obligations under the Guarantee
shall not be deemed to be Senior Indebtedness.
ARTICLE TWO
Mandatory Prepayment and Optional Redemption of the Debentures
--------------------------------------------------------------
SECTION 2.01. If the Partnership redeems Preferred Securities in
accordance with the terms thereof, the Company shall redeem Debentures in a
principal amount equal to the aggregate liquidation preference of the Preferred
Securities so redeemed, at a redemption price equal to 100% of such principal
amount of Debentures so redeemed, together with all accrued and unpaid interest
(including Additional Interest, if any) thereon. If less than all of the
Debentures are to be redeemed pursuant to this Section 2.01, the Debentures will
be redeemed pro rata or by lot or by any other method utilized by the Trustee.
Any payment pursuant to this provision shall be made prior to 12:00 noon, New
York time, on the date the Preferred Securities are so redeemed or at such
earlier time as the Company and the Partnership shall agree.
SECTION 2.02. Subject to the terms of Article Four of the Indenture,
the Company shall have the right to redeem the Debentures, in whole or in part,
from time to time, on or after [_____], at a redemption price equal to 100% of
the principal amount thereof to be redeemed plus any accrued and unpaid interest
(including Additional Interest, if any) thereon to the date of such redemption.
Any redemption pursuant to this Section 2.01 will be made upon not less than 30
nor more than 60 days' notice. If less than all of the Debentures are to be
redeemed pursuant to this Section 2.02, the Debentures will be redeemed pro rata
or by lot or by any other method utilized by the Trustee; provided, however,
that if at the time of redemption the Debentures are in the form of a Global
Debenture, the Depositary shall determine by lot the principal amount of such
Debentures held by each Holder of Debentures to be redeemed; provided further,
however, that any Debentures owned by the Partnership shall not be selected at
any time after a Distribution Event for any such partial redemption.
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<PAGE>
SECTION 2.03. The Company may not redeem (or otherwise purchase) less
than all of the Debentures if as a result of such partial redemption (or
purchase) the Debentures would be delisted from any national securities exchange
on which they are then listed, and in such case if the Company elects to redeem
(or otherwise purchase) any of the Debentures, the Company shall redeem (or
otherwise purchase) all of them. No notice of redemption with respect to the
Debentures may state that such redemption shall be conditional upon the receipt
of monies sufficient to pay the principal thereof or premium, if any, or
interest (including Additional Interest, if any) thereon, as contemplated by the
last paragraph of Section 4.04 of the Indenture.
ARTICLE THREE
Extension of Interest Payment Period
------------------------------------
SECTION 3.01. The Company shall have the right at any time, so long
as the Company is not in default in the payment of interest on the Debentures,
to extend interest payment periods on all of the Debentures for a period of up
to 60 consecutive months, but not beyond the Maturity thereof, and at, or at any
time prior to, the end of any such extended interest payment period, the Company
shall pay all interest then accrued and unpaid, including Additional Interest,
if any, thereon (together with interest thereon at the rate specified therefor
to the extent permitted by applicable law) in the same manner as provided for
the payment of Defaulted Interest in Section 307 of the Indenture; provided,
however, that during any such extended interest payment period the Company shall
not, and shall not permit any Affiliate directly or indirectly controlled by the
Company to, declare or pay any dividend on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any capital stock of the Company or such
Affiliate or make any guarantee payments with respect to the foregoing (other
than payments under the Guarantee); provided further, however, that any such
extended interest payment period may only be selected with respect to the
Debentures if an extended interest payment period of identical length is
simultaneously selected for all Securities then Outstanding under the Indenture.
Prior to the termination of any such extended interest payment period, and
subject to the foregoing requirements, the Company may further extend such
period, provided that such period together with all such further extensions
thereof may not exceed a period of 60 consecutive months and subject to the
limitations described above. Following the termination of any such extended
interest payment period, if the Company has paid all accrued and unpaid
interest, including any Additional Interest, if any (together with interest at
the rate specified for the Debentures to the extent permitted by applicable
law), required by the Debentures for such period, the Company shall have the
right to again extend the interest payment periods on the Debentures for up to
60 consecutive months as provided above.
SECTION 3.02. If the Partnership is the sole Holder of the Debentures
at the time the Company extends an interest payment period thereon as provided
in Section 3.11 of the Indenture, the Company shall give both the Partnership
and the Trustee written notice of its selection of such extended interest
payment period one Business Day prior to the earlier of (a) the date dividends
on any Limited Partner Interests would otherwise be payable and (b) the date the
Partnership is required to give notice of the record or payment date of such
dividends to any national securities exchange on which any Limited Partner
Interests shall be listed or to holders
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<PAGE>
of any Limited Partner Interests, but in any event not less than two Business
Days prior to such record date. The Company shall cause the Partnership to give
notice of the Company's selection of such extended interest payment period to
the holders of the Preferred Securities.
ARTICLE FOUR
Covenants
---------
SECTION 4.01. Upon a Distribution Event, the Company will use its
best efforts to list the Debentures on the New York Stock Exchange or on such
other exchange, on the same part of any such exchange, as the Preferred
Securities are then listed and admitted for trading and to register the
Debentures under the Exchange Act.
SECTION 4.02. The Company shall, so long as the Preferred Securities
remain outstanding, (a) maintain direct or indirect ownership of all interests
in the Partnership other than Limited Partner Interests, (b) not voluntarily (to
the extent permitted by law) dissolve, liquidate or wind up the Partnership, (c)
remain the sole general partner of the Partnership and timely perform in all
material respects all of its duties as general partner of the Partnership
(including its duty to pay dividends on the Preferred Securities and its duty to
pay all costs and expenses of the Partnership), (d) use reasonable efforts to
cause the Partnership to remain a limited partnership and otherwise continue to
be treated as a partnership for Federal income tax purposes and (e) use its best
efforts to conduct the affairs and operate the Partnership in such a way that
the Partnership would not be an "investment company" required to be registered
under the Investment Company Act of 1940, as amended; provided, however, that
any permitted successor to the Company under the Indenture may succeed to the
Company's duties as general partner of the Partnership; provided further,
however, that the Company may permit the Partnership to consolidate or merge
with or into another limited partnership or other permitted successor under the
Partnership Agreement so long as the Company agrees to comply with this Section
4.02 with respect to such successor limited partnership or other permitted
successor.
SECTION 4.03. The holders of the Preferred Securities will have the
rights provided to them under the Partnership Agreement, including the right
under certain circumstances to appoint a Special Representative authorized to
exercise the Partnership's right to accelerate the principal amount of the
Debentures and to enforce the Partnership's other rights under the Debentures
and the Indenture. In addition, the Company acknowledges and agrees that, so
long as the Preferred Securities remain outstanding, its obligations under the
Indenture will also be for the benefit of the holders from time to time of the
Preferred Securities and such holders, or any Special Representative (as defined
in the Partnership Agreement) acting on behalf of such holders, will be entitled
to enforce the Indenture, as third party beneficiaries, directly against the
Company (without first proceeding against the Partnership) to the same extent as
if such holders held a principal amount of Securities equal to the liquidation
preference of the Preferred Securities held by such holders.
SECTION 4.04. The Company shall not, and shall not permit any
Affiliate directly or indirectly controlled by the Company to, declare or pay
any dividend on, or redeem, purchase, acquire or make a distribution or
liquidation payment with respect to, any capital stock
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<PAGE>
of the Company or such Affiliate, or make any guarantee payments with respect to
the foregoing (other than payments under the Guarantee), if at such time the
Company shall be in default with respect to its payment or other obligations
under the Guarantee.
ARTICLE FIVE
Form of Debenture
-----------------
The Debentures and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the following forms:
[FORM OF FACE OF DEBENTURE]
[If the Debentures are to be issued as a Global Debenture, insert:
This Debenture is a Global Debenture within the meaning of the Indenture
hereinafter referred to and is registered in the name of the Depositary or a
nominee of the Depositary. This Debenture is exchangeable for Securities of the
same series registered in the name of a person other than the Depositary or its
nominee only in the limited circumstances described in the Indenture, and no
transfer of this Debenture (other than a transfer of this Debenture as a whole
by the Depositary to a nominee of the Depositary, 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 selected by the Company or such
successor's nominee) may be registered except in limited circumstances.
Unless this Debenture is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York) to the Company or its
agent for registration of transfer, exchange or payment, and any certificate to
be issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL, since the registered
owner hereof, Cede & Co., has an interest herein.]
THE UNITED ILLUMINATING COMPANY
[__]% Junior Subordinated Deferrable Interest Debenture, Series [__], Due
[_____]
No. _________________ CUSIP No. ___________
THE UNITED ILLUMINATING COMPANY, a corporation duly organized and
existing under the laws of the State of Connecticut (herein referred to as the
"Company," which term includes any successor corporation under the Indenture
referred to hereinafter), for value received, hereby promises to pay to
__________________, or registered assigns, the principal sum of
__________________ Dollars on [_____], and to pay interest thereon from [_____]
or
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<PAGE>
from the most recent interest payment date (each such date, an "Interest Payment
Date") to which interest has been paid or duly provided for, in arrears on the
last day of each calendar month of each year, commencing [_____], and when the
principal hereof shall have become due and payable, whether at maturity, upon
call for redemption, by declaration of acceleration or otherwise ("Maturity"),
at the rate of [__]% per annum plus Additional Interest, if any, until the
principal hereof shall have become so due and payable, and on any overdue
principal and premium, if any, and (to the extent that payment of such interest
is enforceable under applicable law) on any overdue installment of interest
(including Additional Interest, if any) at the same rate per annum. The amount
of interest payable on any Interest Payment Date shall be computed on the basis
of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Securities of this series is not a Business Day, then
payment of interest payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on such date. The
interest installment so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture, be paid to the
person in whose name this Debenture (or one or more Predecessor Securities of
the same series) is registered at the close of business on the Regular Record
Date for such interest installment, which shall be the close of business on the
Business Day next preceding such Interest Payment Date; provided, however, that
if the Securities of this series are not held solely by United Capital Funding
Partnership L.P., a Delaware limited partnership (the "Partnership"), or by the
Depositary, the Company may select a Regular Record Date for such interest
installment, which shall be any day not more than 15 days preceding an Interest
Payment Date; provided further, however, that (i) if this Debenture is
authenticated after a Regular Record Date and before the Interest Payment Date
therefor, such interest installment shall be paid on the next succeeding
Interest Payment Date to the registered holder thereof on the Regular Record
Date therefor and (ii) interest payable at Maturity shall be paid to the Person
to whom principal is paid. Any such interest installment not punctually paid or
duly provided for shall forthwith cease to be payable to the registered holders
on such Regular Record Date, and may be paid to the person in whose name this
Debenture (or one or more Predecessor Securities of the same series) is
registered at the close of business on a Special Record Date to be fixed by the
Trustee for the payment of such defaulted interest, notice whereof shall be
given to the registered holders of Securities of this series not less than 10
days prior to such Special Record Date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in the Indenture
hereinafter referred to. The principal of and premium, if any, and interest
(including Additional Interest, if any) on this Debenture shall be payable at
the office or agency of the Company maintained for that purpose in the Borough
of Manhattan, the City of New York, in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest on this Debenture may
be made at the option of the Company by check mailed to the registered holder
hereof at such address as shall appear in the Security Register.
Notwithstanding the foregoing, so long as the registered holder of this
Debenture is the Partnership, the payment of the principal of and premium, if
any, and interest (including Additional Interest, if any) on this Debenture will
be made at such place and to such account as may be designated by the
Partnership.
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<PAGE>
The indebtedness evidenced by this Debenture is, to the extent and in
the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment of all Senior Indebtedness, and this Debenture is
issued subject to the provisions of the Indenture with respect thereto. Each
holder of this Debenture, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the Trustee on such
holder's behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination so provided and (c) appoints the
Trustee as such holder's attorney-in-fact for any and all such purposes. Each
holder hereof, by such holder's acceptance hereof, hereby waives all notice of
the acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
This Debenture shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the Certificate of Authentication hereon shall have been signed by or on
behalf of the Trustee.
The provisions of this Debenture are contained on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
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<PAGE>
IN WITNESS WHEREOF, the Company has caused this Instrument to be
executed.
Dated: ____________________
THE UNITED ILLUMINATING COMPANY
By:____________________________
Its:
Attest:
___________________________
Secretary
[FORM OF CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series of Securities referred to
in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:_______________________
Authorized Signatory
[FORM OF REVERSE OF DEBENTURE]
This [__]% Junior Subordinated Deferable Interest Debenture, Series
[__], Due [_____] (herein sometimes referred to as this "Debenture") is one of a
duly authorized series of Securities of the Company, specified in the Indenture
(as defined below), all issued or to be issued in one or more series under and
pursuant to an Indenture dated as of [_____], 1994 duly executed and delivered
between the Company and THE BANK OF NEW YORK, a New York banking corporation
duly organized and existing under the laws of the State of New York, as trustee
(herein referred to as the "Trustee"), as amended and supplemented [from time to
time, including] by the [_____] Supplemental Indenture dated as of [_____]
between the Company and the Trustee (said Indenture as so supplemented being
hereinafter referred to as the "Indenture"), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of
the rights, limitations of rights, obligations, duties and immunities thereunder
of
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<PAGE>
the Trustee, the Company and the holders of the Securities of this series. By
the terms of the Indenture, the Securities are issuable in series that may vary
as to amount, date of maturity, rate of interest and in other respects as in the
Indenture provided. The Securities of this series are limited in aggregate
principal amount as specified in said Supplemental Indenture.
If the Partnership redeems, in whole or in part, its [__]% Preferred
Capital Securities, Series [__] (the "Preferred Securities"), the proceeds of
the offer and sale of which, together with the amount of capital contributions
made by the Company from time to time as general partner of the Partnership in
connection with the Preferred Securities, were invested in the Securities of
this series, in accordance with the terms thereof, the Company shall redeem the
Securities of this series at a redemption price equal to 100% of the aggregate
principal amount hereof, together with any interest (including Additional
Interest, if any) accrued thereon. If less than all of the Preferred Securities
are to be so redeemed, the Securities of this series will be redeemed pro rata
or by lot or by any other method utilized by the Trustee. Any such redemption
shall be made prior to 12:00 noon, New York time, on the date such Preferred
Securities are so redeemed or at such earlier time as the Company and the
Partnership shall agree.
Subject to the terms of Article Four of the Indenture, the Company
shall have the right to redeem the Securities of this series at the option of
the Company, without premium or penalty, in whole or in part at any time on or
after [_____], at a redemption price equal to 100% of the principal amount plus
any accrued but unpaid interest (including Additional Interest, if any) to the
date of such redemption. Any redemption pursuant to this paragraph will be made
upon not less than 30 nor more than 60 days' notice. If less than all of the
Securities of this series are to be so redeemed, the Securities of this series
will be redeemed pro rata or by lot or by any other method utilized by the
Trustee; provided, however, that if at the time of such redemption, the
Securities of this series are in the form of a Global Debenture, the Depositary
shall determine by lot the principal amount thereof held by each holder of
Securities of this series to be redeemed; provided further, however, that after
any Debentures owned by the Partnership shall not be selected at any time after
a Distribution Event for any such partial redemption.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion hereof will be issued in the
name of the holder hereof upon the cancellation hereof.
If an Event of Default with respect to the Securities of this series
shall have occurred and be continuing, the principal of all of such Securities
may be declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions for defeasance at any time of the
entire indebtedness of this Debenture upon compliance by the Company with
certain conditions set forth therein.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the
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Securities of each series affected at the time outstanding, as defined in the
Indenture, to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of modifying in any manner the rights of the holders of
Securities; provided, however, that no such supplemental indenture shall, among
other things, (i) change the Stated Maturity of any Securities of any series, or
reduce the principal amount thereof, or reduce the rate of interest thereon, or
reduce any premium payable upon the redemption thereof or the amount of any
installment of interest thereon, without the consent of the holder of each
Security so affected, (ii) reduce the aforesaid percentage in principal amount
of Securities that is required to consent to any such supplemental indenture,
without the consent of the holders of each Security then outstanding and
affected thereby or (iii) modify the subordination provisions contained in the
Indenture. Notwithstanding the foregoing, so long as any Preferred Securities
remain outstanding, the Partnership may not consent to a supplemental indenture
thereunder without the prior consent of the holders of at least 66% in
aggregate liquidation preference of the outstanding Preferred Securities
affected, considered as one class, or, in the case of any of the changes
described in clauses (i) through (iii) above, 100% in aggregate liquidation
preference of the outstanding Preferred Securities affected, considered as one
class.
The Indenture also contains provisions permitting the holders of a
majority in aggregate principal amount of the Securities of all series at the
time outstanding affected thereby, on behalf of the holders of the Securities of
such series, to waive any past default in the performance of any of the
covenants contained in the Indenture, or established pursuant to the Indenture
with respect to such series, and its consequences, except a default in the
payment of the principal of or premium, if any, or interest (including
Additional Interest, if any) on any of the Securities of such series, which
default may be waived by the unanimous consent of the holders affected. Any
such consent or waiver by the registered holder of this Debenture (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Debenture and of any
Security of the same series issued in exchange herefor or in place hereof
(whether by registration of transfer or otherwise), irrespective of whether or
not any notation of such consent or waiver is made upon this Debenture.
Notwithstanding anything to the contrary in the Indenture, so long as the
Partnership holds the Securities of this series, the Partnership may not waive
any past default without the consent of the holders of at least 66% in
aggregate liquidation preference of the Preferred Securities affected.
No reference herein to the Indenture and no provision of this
Debenture 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 (including Additional Interest, if any) on this
Debenture at the time and place and at the rate and in the money herein
prescribed.
The Company shall have the right at any time, so long as the Company
is not in default in the payment of interest on the Securities of any series, to
extend interest payment periods on all of the Securities of this series for a
period of up to 60 consecutive months, but not beyond the Maturity thereof, and
at, or at any time prior to, the end of any such extended interest payment
period, the Company shall pay all interest then accrued and unpaid, including
Additional Interest, if any, thereon (together with interest thereon at the rate
specified therefor
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<PAGE>
to the extent permitted by applicable law) in the same manner as provided for
the payment of Defaulted Interest in Section 307 of the Indenture; provided,
however, that during any such extended interest payment period the Company shall
not, and shall not permit any Affiliate directly or indirectly controlled by the
Company to, declare or pay any dividend on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any capital stock of the Company or such
Affiliate or make any guarantee payments with respect to the foregoing (other
than payments under the Guarantee); provided further, however, that any such
extended interest payment period may only be selected with respect to the
Securities of this series if an extended interest payment period of identical
length is simultaneously selected for all Securities then Outstanding under the
Indenture. Prior to the termination of any such extended interest payment
period, and subject to the foregoing requirements, the Company may further
extend such period, provided that such period together with all such further
extensions thereof may not exceed a period of 60 consecutive months and subject
to the limitations described above. Following the termination of any such
extended interest payment period, if the Company has paid all accrued and unpaid
interest, including any Additional Interest, if any (together with interest at
the rate specified for the Securities of this series to the extent permitted by
applicable law), required by the Securities for such period, the Company shall
have the right to again extend the interest payment periods on the Securities of
this series for up to 60 consecutive months as provided above.
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable by the registered holder
hereof on the Security Register of the Company, upon surrender of this Debenture
for registration of transfer at the office or agency of the Company in the
Borough of Manhattan, the City of New York accompanied by a written instrument
or instruments of transfer in form satisfactory to the Company and the Trustee
duly executed by the registered holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Securities of the same
series of authorized denominations and for the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of this Debenture, the
Company, the Trustee and any agent of the Company or the Trustee may deem and
treat the registered holder hereof as the absolute owner hereof (whether or not
this Debenture shall be overdue) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and (subject to the
provisions of the Indenture) interest (including Additional Interest, if any)
due hereon and for all other purposes, and neither the Company nor the Trustee
nor any agent of the Company or the Trustee shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the principal of or the
premium, if any, or the interest (including Additional Interest, if any) on this
Debenture, or for any claim based hereon, or otherwise in respect hereof, or
based on or in respect of the Indenture, against any incorporator, stockholder,
officer or director, past, present or future, as such, of the Company or of any
predecessor or successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such
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<PAGE>
liability being, by the acceptance hereof and as part of the consideration for
the issuance hereof, expressly waived and released.
The Securities of this series are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations herein and therein
set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series of a different authorized
denomination, as requested by the holder surrendering the same.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE SIX
Events of Default; Remedies
---------------------------
SECTION 6.01. Whenever used with respect to the Debentures, "Event of
Default" shall include, in addition to the events specified in paragraphs (a)
through (e) of Section 801 of the Indenture, the following events:
(a) failure to pay Additional Interest on any Debenture within
fifteen (15) days after the same becomes due and payable (whether or not
payment is prohibited by the provisions of Article Fifteen of the Indenture
or otherwise and whether or not the Company has extended an interest
payment period with respect to the Debentures as provided in Section 3.11
of the Indenture); or
(b) so long as any Limited Partner Interests remain outstanding,
the entry by a court having jurisdiction in the premises of (i) a decree or
order for relief in respect of the Partnership in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (ii) a decree or order adjudging the
Partnership a bankrupt or insolvent, or approving as properly filed a
petition by on or more Persons other than the Partnership seeking
reorganization, arrangement, adjustment or composition of or in respect of
the Partnership under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official for the Partnership or for any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and any
such decree or order for relief or any such other decree or order for
relief or any such other decree or order shall have remained unstayed and
in effect for a period of 90 consecutive days; or
(c) so long as Limited Partner Interests remain outstanding, the
commencement by the Partnership of a voluntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or any other case or proceeding to be adjudicated a bankrupt or
insolvent, or
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<PAGE>
the consent by the Partnership to the entry of a decree or order for relief
in respect of it in a case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy, insolvency, reorganization or other similar
law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by the Partnership of a petition or
answer or consent seeking reorganization or relief under any applicable
Federal or State law, or the consent by the Partnership to the filing of
such petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar official
of the Partnership or of any substantial part of its property, or the
making by the Partnership of an assignment for the benefit of creditors, or
the admission by the Partnership in writing of its inability to pay its
debts generally as they become due, or the authorization of such action by
the general partner of the Partnership.
SECTION 6.02. So long as any Limited Partner Interests are
outstanding, the Trustee shall be entitled and empowered, in case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Partnership or its property, to make such filings,
prove such claims and collect and receive such property in any such judicial
proceeding to the same extent and in the same manner as provided in Section 8.04
of the Indenture with respect to any such judicial proceeding relative to the
Company or its property; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding relative to the Partnership or its property is hereby authorized by
each Holder 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 amounts due it under Section 907 of the Indenture.
ARTICLE SEVEN
Other Matters
-------------
SECTION 7.01. (a) The Company designates its principal office in New
Haven, Connecticut as an office at which (i) the principal of and premium, if
any, and interest (including Additional Interest, if any) on the Debentures
shall be payable, (ii) registration of transfers and exchanges of the Debentures
may be effected and (iii) notices and demands to or upon the Company in respect
of the Debentures and the Indenture may be served.
(b) The Company designates the office of The Bank of New York in New
York, New York shall be an office or agency of the Company at which (i)
registration of transfers and exchanges of the Debentures may be effected and
(ii) notices and demands to or upon the Company in respect of the Debentures and
the Indenture may be served.
(c) The Company designates (i) each of (A) its principal office in
New Haven, Connecticut and (B) the office of The Bank of New York in New York,
New York as an office or agency in which a register with respect to the
Debentures shall be maintained and (ii) itself
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as the Security Registrar with respect to the Debentures; provided, however,
that upon a Distribution Event, automatically and without any further action,
The Bank of New York and not the Company shall be the Security Registrar.
(d) The Company reserves the right to change, by one or more
supplemental indentures, any such designation made pursuant to this Section
7.01.
SECTION 7.02. The proper officers of the Company may execute, with
the Paying Agent and any Authenticating Agent for the Debentures, one or more
Letters of Representations to the Depositary and any supplements or amendments
thereto necessary or desirable to make the Debentures eligible for deposit at
the Depositary; provided, however, that the Company reserves the right to
terminate any such Letter of Representations by one or more Officer's
Certificates; provided further, however, that the Company reserves the right to
enter into similar agreements with any other depositary with respect to the
Debentures by one or more Officer's Certificates.
SECTION 7.03. Notwithstanding Section 813 of the Indenture, so long
as the Partnership holds the Debentures, the Partnership may not waive any past
default without the consent, obtained as provided in the Partnership Agreement,
of the holders of at least 66% in aggregate liquidation preference of the
Preferred Securities affected.
SECTION 7.04. Notwithstanding Section 1202 of the Indenture, so long
as any Limited Partner Interests remain outstanding, the Partnership may not
consent to a supplemental indenture thereunder without the prior consent,
obtained as provided in the Partnership Agreement, of the holders of at least
66% in aggregate liquidation preference of the outstanding Limited Partner
Interests affected, considered as one class, or, in the case of any of the
changes described in clauses (a) through (e) of Section 1202 of the Indenture,
100% in aggregate liquidation preference of the outstanding Limited Partner
Interests affected, considered as one class.
SECTION 7.05. Notwithstanding Section 910 of the Indenture, so long
as any Limited Partner Interests remain outstanding, the Partnership shall not
enter into any act to remove the Trustee without the consent of the holders of
at least 66% in aggregate liquidation preference of the outstanding Limited
Partner Interests affected, considered as one class.
SECTION 7.06. So long as the Partnership holds the Debentures, any
request, demand, authorization, direction, notice, consent, election, waiver or
other action provided by the Indenture to be made, given or taken by Holders of
the Debentures may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by a Special Representative or,
alternatively, may be embodied in and evidenced by the record of Special
Representatives voting in favor thereof, either in person or by proxies duly
appointed in writing, at any meeting of such Holders duly called and held in
accordance with the provisions of Article Thirteen of the Indenture, or a
combination of such instruments and any such record.
ARTICLE EIGHT
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<PAGE>
Miscellaneous Provisions
------------------------
SECTION 8.01. Except as otherwise expressly provided in this
Supplemental Indenture or in the form of Debenture or otherwise clearly required
by the context hereof or thereof, all terms used herein or in said form of
Debenture that are defined in the Indenture shall have the several meanings
respectively assigned to them thereby.
SECTION 8.02. The Indenture, as supplemented by this Supplemental
Indenture, is in all respects ratified and confirmed, and this Supplemental
Indenture shall be deemed part of the Indenture in the manner and to the extent
herein and therein provided.
SECTION 8.03. The recitals herein contained are made by the Company
and not by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representation as to the validity or
sufficiency of this Supplemental Indenture.
SECTION 8.04. This Supplemental Indenture may be executed in any
number of counterparts each of which shall be an original; but such counterparts
shall together constitute but one and the same instrument.
-18-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, on the date or dates indicated in the
acknowledgements and as of the day and year first above written.
THE UNITED ILLUMINATING COMPANY
By: ____________________________
Attest:
________________________
THE BANK OF NEW YORK, as Trustee
By: ____________________________
Attest:
________________________
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<PAGE>
EXHIBIT 4(G)
[SUPPLEMENTAL INDENTURE ESTABLISHING DEBENTURES]
THE UNITED ILLUMINATING COMPANY
and
THE BANK OF NEW YORK,
Trustee
-------------------
[_____] SUPPLEMENTAL INDENTURE
Dated as of [_____]
to
INDENTURE
Dated as of [_____], 1994
-------------------
[__]% Junior Subordinated Deferrable Interest Debentures, Series [__], Due
[_____]
<PAGE>
[_____] SUPPLEMENTAL INDENTURE dated as of [_____] (this "Supplemental
Indenture") between THE UNITED ILLUMINATING COMPANY, a corporation duly
organized and existing under the laws of the State of Connecticut (the
"Company"), and THE BANK OF NEW YORK, a New York banking corporation organized
and existing under the laws of the State of New York, as trustee (the "Trustee")
under the Indenture dated as of [_____], 1994 between the Company and the
Trustee (as such Indenture may heretofore have been amended and supplemented,
the "Indenture"). Capitalized terms used and not defined herein are used as
defined in the Indenture.
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide for the future issuance of Securities, to be issued from
time to time in one or more series as might be determined by the Company
under the Indenture, in an unlimited aggregate principal amount that may be
authenticated and delivered thereunder as in the Indenture provided;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a new series of Securities to
be known as its [__]% Junior Subordinated Deferrable Interest Debentures,
Series [__], Due [_____] (the "Debentures"), the form and substance
thereof, and the terms, provisions and conditions thereof, to be set forth
as provided in the Indenture and this Supplemental Indenture; and
WHEREAS, the Company desires and has requested the Trustee to
join with it in the execution and delivery of this Supplemental Indenture
and all requirements necessary to make this Supplemental Indenture a valid
instrument, in accordance with its terms, and to make the Debentures, when
executed by the Company and authenticated and delivered by the Trustee, the
valid obligations of the Company, have been performed and fulfilled, and
the execution and delivery hereof have been in all respects duly
authorized.
NOW, THEREFORE, in consideration of the purchase and acceptance of the
Debentures by the holders thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Debentures and the
terms, provisions and conditions thereof, the Company covenants and agrees with
the Trustee as follows:
ARTICLE ONE
General Terms and Conditions of the Debentures
----------------------------------------------
SECTION 1.01. There shall be and is hereby authorized a series of
Securities designated the "[__]% Junior Subordinated Deferrable Interest
Debentures, Series [__], Due [_____]," the aggregate principal amount of which
shall be limited to $[_____], which amount shall be as set forth in any written
order of the Company for the authentication and delivery of
<PAGE>
Debentures. Debentures may, upon execution of this Supplemental Indenture or
from time to time thereafter, be executed by the Company and delivered to the
Trustee for authentication, and the Trustee shall thereupon authenticate and
deliver such Debentures to or upon the written order of the Company, signed by
its Chairman, its President, or any Vice President and its Treasurer or an
Assistant Treasurer, without any further action by the Company. The Debentures
shall mature and the principal thereof shall be due and payable together with
all accrued and unpaid interest thereon, on [_____], and shall be issued in the
form of registered Debentures without coupons.
SECTION 1.02. (a) The Debentures shall be issued in global form (a
"Global Debenture") in an aggregate principal amount equal to the principal
amount of the Debentures, to be registered in the name of The Depository Trust
Company, New York, New York or any successor registered as a clearing agency
under the Exchange Act or other applicable statute or regulation (the
"Depositary"), or its nominee, and delivered by the Trustee to the Depositary
for crediting to the accounts of its participants pursuant to the instructions
of the Company. Payments on the Debentures issued as a Global Debenture will be
made to the Depositary.
(b) Notwithstanding the provisions of Section 3.05 of the Indenture,
the Global Debenture may be transferred, in whole but not in part, in the manner
provided in Section 3.05 of the Indenture, only by the Depositary to a nominee
of the Depositary, by a nominee of the Depositary to the Depositary or to
another nominee of the Depositary, or to a successor Depositary selected or
approved by the Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for the Debentures or if at any
time the Depositary for the Debentures shall no longer be registered under the
Exchange Act, or other applicable statute or regulation, and a successor
Depositary for the Debentures is not appointed by the Company within 90 days
after the Company receives such notice or becomes aware of such condition, as
the case may be, this Section 1.02 shall no longer be applicable to the
Debentures and the Company will execute and, subject to Section 3.05 of the
Indenture, the Trustee will authenticate and deliver Debentures in definitive
registered form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Debenture
in exchange for such Global Debenture. In addition, the Company may at any time
determine that the Debentures shall no longer be represented by a Global
Debenture, and that the provisions of this Section 1.02 shall no longer apply to
the Debentures. In such event, the Company will execute and, subject to Section
3.05 of the Indenture, the Trustee, upon receipt of an Officer's Certificate
evidencing such determination by the Company, will authenticate and deliver
Debentures in definitive registered form without coupons, in authorized
denominations, and in aggregate principal amount equal to the principal amount
of the Global Debenture in exchange for such Global Debenture. Upon exchange of
the Global Debenture for such Debentures in definitive registered form without
coupons, in authorized denominations, the Global Debenture shall be canceled by
the Trustee. Such Debentures in definitive registered form issued in exchange
for the Global Debenture pursuant to this Section 1.02(c) shall be registered in
such names and authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Trustee shall deliver such Debentures to the
Depositary for delivery to the persons in whose names such Debentures are so
registered.
-2-
<PAGE>
SECTION 1.03. If, pursuant to the provisions of Section 1.02(c)
hereof, the Debentures are issued in certificated form, principal of and
premium, if any, and interest thereon will be payable, the transfer thereof will
be registrable, and Debentures will be exchangeable for Debentures bearing
identical terms and provisions, at the office or agency of the Company in the
Borough of Manhattan, the City of New York, in any coin or currency of the
United States of America that at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest on any
of the Debentures may be made at the option of the Company by check mailed to
the Holder thereof at such address as shall appear in the Security Register.
SECTION 1.04. Each Debenture will bear interest at the rate of [__]%
per annum from its original date of issuance or from the most recent Interest
Payment Date (as defined below) to which interest has been paid or duly provided
for until the principal thereof becomes due and payable, and any overdue
principal thereof and (to the extent that payment of such interest is
enforceable under applicable law) any overdue installment of interest thereon
will bear interest at the same rate per annum, payable in arrears on the last
day of each calendar month of each year (each, an "Interest Payment Date"),
commencing on [_____], and at Maturity to the person in whose name such
Debenture or any Predecessor Security thereof is registered, at the close of
business on the Regular Record Date for such interest installment, which shall
be the close of business on the Business Day next preceding such Interest
Payment Date; provided, however, that, if the Debentures are not held by the
Depositary, the Company may select a Regular Record Date for such interest
installment that shall be any date not more than 15 days preceding an Interest
Payment Date; provided further, however, that (i) if any Debenture is
authenticated after a Regular Record Date and before the Interest Payment Date
therefor, such interest installment shall be paid on the next succeeding
Interest Payment Date to the Holder thereof on the Regular Record Date therefor
and (ii) interest payable at Maturity shall be paid to the Person to whom
principal is paid. Any such interest installment not punctually paid or duly
provided for shall forthwith cease to be payable to such Holder on such Regular
Record Date by virtue of having been such Holder, and such defaulted interest
may be paid by the Company, at its election, to the person in whose name the
Debenture (or one or more Predecessor Securities thereof) is registered at the
close of business on a Special Record Date to be fixed by the Trustee for the
payment of such defaulted interest, notice whereof shall be given to the Holders
of the Debentures not less than 10 days prior to such Special Record Date, or in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.
SECTION 1.05. "Business Day" for purposes of the Debentures shall
mean any day on which banking institutions in the City of New York, New York or
the City of New Haven, Connecticut are authorized or required by law to close.
ARTICLE TWO
Redemption of the Debentures
----------------------------
-3-
<PAGE>
SECTION 2.01. Subject to the terms of Article Four of the Indenture,
the Company shall have the right to redeem the Debentures, in whole or in part,
from time to time, on or after [_____], at the following redemption prices
(expressed in percentages of the principal amounts to be redeemed) during the
twelve-month periods commencing on [_____] of the years indicated:
Year Redemption Price
---- ----------------
plus, in each case, any accrued and unpaid interest thereon to the date of such
redemption. Any redemption pursuant to this Section 2.01 will be made upon not
less than 30 nor more than 60 days' notice. If less than all of the Debentures
are to be redeemed pursuant to this Section 2.01, the Debentures will be
redeemed pro rata or by lot or by any other method utilized by the Trustee;
provided, however, that if at the time of redemption the Debentures are in the
form of a Global Debenture, the Depositary shall determine by lot the principal
amount of such Debentures held by each holder of Debentures to be redeemed.
SECTION 2.02. The Company may not redeem (or otherwise purchase) less
than all of the Debentures if as a result of such partial redemption (or
purchase) the Debentures would be delisted from any national securities exchange
on which they are then listed, and in such case if the Company elects to redeem
(or otherwise purchase) any of the Debentures, the Company shall redeem (or
otherwise purchase) all of them. No notice of redemption with respect to the
Debentures may state that such redemption shall be conditional upon the receipt
of monies sufficient to pay the principal thereof or premium, if any, or
interest thereon, as contemplated by the last paragraph of Section 4.04 of the
Indenture.
ARTICLE THREE
Form of Debenture
-----------------
The Debentures and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the following forms:
[FORM OF FACE OF DEBENTURE]
[[If the Debenture is to be a Global Debenture, insert: This
Debenture is a Global Debenture within the meaning of the Indenture hereinafter
referred to and is registered in the name of the Depositary or a nominee of the
Depositary. This Debenture is exchangeable for Securities of the same series
registered in the name of a person other than the Depositary or its nominee only
in the limited circumstances described in the Indenture, and no transfer of this
Debenture (other than a transfer of this Debenture as a whole by the Depositary
to a nominee of the Depositary, by a nominee of the Depositary to the Depositary
or another nominee of the
-4-
<PAGE>
Depositary or by the Depositary or any such nominee to a successor Depositary
selected by the Company or such successor's nominee) may be registered except in
limited circumstances.
Unless this Debenture is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York) to the Company or its
agent for registration of transfer, exchange or payment, and any certificate to
be issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
THE UNITED ILLUMINATING COMPANY
[__]% Junior Subordinated Deferrable Interest Debenture, Series a, Due [_____]
No. _________________ CUSIP No. ___________
THE UNITED ILLUMINATING COMPANY, a corporation duly organized and
existing under the laws of the State of Connecticut (herein referred to as the
"Company," which term includes any successor corporation under the Indenture
referred to hereinafter), for value received, hereby promises to pay to
__________________, or registered assigns, the principal sum of
__________________ Dollars on [_____], and to pay interest thereon from [_____]
or from the most recent interest payment date (each such date, an "Interest
Payment Date") to which interest has been paid or duly provided for, in arrears
on the last day of each calendar month of each year, commencing [_____], and
when the principal hereof shall have become due and payable, whether at
maturity, upon call for redemption, by declaration of acceleration or otherwise
("Maturity"), at the rate of [__]% per annum until the principal hereof shall
have become so due and payable, and on any overdue principal and premium, if
any, and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the same rate per
annum. The amount of interest payable on any Interest Payment Date shall be
computed on the basis of a 360-day year of twelve 30-day months. In the event
that any date on which interest is payable on the Securities of this series is
not a Business Day, then payment of interest payable on such date will be made
on the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), with the same force and effect as
if made on such date. The interest installment so payable, and punctually paid
or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the person in whose name this Debenture (or one or more
Predecessor Securities of the same series) is registered at the close of
business on the Regular Record Date for such interest installment, which shall
be the close of business on the Business Day next preceding such Interest
Payment Date; provided, however, that if the Securities of this series are not
held by the Depositary, the Company may select a Regular Record Date for such
interest installment, which shall be any day not more than 15 days preceding an
Interest Payment Date; provided further, however, that (i) if this Debenture is
authenticated after a Regular Record Date and before the Interest Payment Date
therefor, such
-5-
<PAGE>
interest installment shall be paid on the next succeeding Interest Payment Date
to the registered holder thereof on the Regular Record Date therefor and (ii)
interest payable at Maturity shall be paid to the Person to whom principal is
paid. Any such interest installment not punctually paid or duly provided for
shall forthwith cease to be payable to the registered holders on such Regular
Record Date, and may be paid to the person in whose name this Debenture (or one
or more Predecessor Securities of the same series) is registered at the close of
business on a Special Record Date to be fixed by the Trustee for the payment of
such defaulted interest, notice whereof shall be given to the registered holders
of Securities of this series not less than 10 days prior to such Special Record
Date, or may be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities of this
series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in the Indenture hereinafter referred to. The
principal of and premium, if any, and interest on this Debenture shall be
payable at the office or agency of the Company maintained for that purpose in
the Borough of Manhattan, the City of New York, in any coin or currency of the
United States of America that at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest on this
Debenture may be made at the option of the Company by check mailed to the
registered holder hereof at such address as shall appear in the Security
Register.
The indebtedness evidenced by this Debenture is, to the extent and in
the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment of all Senior Indebtedness, and this Debenture is
issued subject to the provisions of the Indenture with respect thereto. Each
holder of this Debenture, by accepting the same, (a) agrees to and shall be
bound by such provisions, (b) authorizes and directs the Trustee on such
holder's behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination so provided and (c) appoints the
Trustee as such holder's attorney-in-fact for any and all such purposes. Each
holder hereof, by such holder's acceptance hereof, hereby waives all notice of
the acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
This Debenture shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the Certificate of Authentication hereon shall have been signed by or on
behalf of the Trustee.
The provisions of this Debenture are contained on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
-6-
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Instrument to be
executed.
Dated: ____________________
THE UNITED ILLUMINATING COMPANY
By:____________________________
Its:
Attest:
___________________________
Secretary
[FORM OF CERTIFICATE OF AUTHENTICATION]
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series of Securities referred to
in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:_______________________
Authorized Signatory
[FORM OF REVERSE OF DEBENTURE]
This [__]% Junior Subordinated Deferable Interest Debenture, Series
[__], Due [_____] (herein sometimes referred to as this "Debenture") is one of a
duly authorized series of Securities of the Company, specified in the Indenture
(as defined below), all issued or to be issued in one or more series under and
pursuant to an Indenture dated as of [_____], 1994 duly executed and delivered
between the Company and THE BANK OF NEW YORK, a New York banking corporation
duly organized and existing under the laws of the State of New York, as trustee
(herein referred to as the "Trustee"), as amended and supplemented [from time to
time, including] by the [_____] Supplemental Indenture dated as of [_____]
between the Company and the Trustee (said Indenture as so supplemented being
hereinafter referred to as the "Indenture"), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of
the rights, limitations of rights, obligations, duties and immunities thereunder
of
-7-
<PAGE>
the Trustee, the Company and the holders of the Securities of this series. By
the terms of the Indenture, the Securities are issuable in series that may vary
as to amount, date of maturity, rate of interest and in other respects as in the
Indenture provided. The Securities of this series are limited in aggregate
principal amount as specified in said Supplemental Indenture.
Subject to the terms of Article Four of the Indenture, the Company
shall have the right to redeem the Securities of this series at the option of
the Company, without premium or penalty, in whole or in part at any time on or
after [_____], at the following redemption prices (expressed as percentages of
the principal amounts to be redeemed) during the twelve-month periods commencing
on [_____] of the years indicated:
Year Amount
---- ------
plus, in each case, any accrued but unpaid interest to the date of such
redemption. Any redemption pursuant to this paragraph will be made upon not
less than 30 nor more than 60 days' notice. If less than all of the Securities
of this series are to be so redeemed, the Securities of this series will be
redeemed pro rata or by lot or by any other method utilized by the Trustee;
provided, however, that if at the time of such redemption, the Securities of
this series are in the form of a Global Debenture, the Depositary shall
determine by lot the principal amount thereof held by each holder of Securities
of this series to be redeemed.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures for the unredeemed portion hereof will be issued in the
name of the holder hereof upon the cancellation hereof.
If an Event of Default with respect to the Securities of this series
shall have occurred and be continuing, the principal of all of such Securities
may be declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions for defeasance at any time of the
entire indebtedness of this Debenture upon compliance by the Company with
certain conditions set forth therein.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the Securities of each series affected at the time
outstanding, as defined in the Indenture, to execute supplemental indentures for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of modifying in any manner the rights
of the holders of Securities; provided, however, that no such supplemental
indenture shall, among other things, (i) change the Stated Maturity of any
Securities of any series, or reduce the principal amount thereof, or reduce the
rate of interest thereon, or reduce any premium payable upon the redemption
thereof or the amount of any installment of interest thereon, without the
consent of the holder of each Security so affected, (ii) reduce the aforesaid
percentage in
-8-
<PAGE>
principal amount of Securities that is required to consent to any such
supplemental indenture, without the consent of the holders of each Security then
outstanding and affected thereby or (iii) modify the subordination provisions
contained in the Indenture. The Indenture also contains provisions permitting
the holders of a majority in aggregate principal amount of the Securities of all
series at the time outstanding affected thereby, on behalf of the holders of the
Securities of such series, to waive any past default in the performance of any
of the covenants contained in the Indenture, or established pursuant to the
Indenture with respect to such series, and its consequences, except a default in
the payment of the principal of or premium, if any, or interest on any of the
Securities of such series, which default may be waived by the unanimous consent
of the holders affected. Any such consent or waiver by the registered holder of
this Debenture (unless revoked as provided in the Indenture) shall be conclusive
and binding upon such holder and upon all future holders and owners of this
Debenture and of any Security of the same series issued in exchange herefor or
in place hereof (whether by registration of transfer or otherwise), irrespective
of whether or not any notation of such consent or waiver is made upon this
Debenture.
No reference herein to the Indenture and no provision of this
Debenture 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 Debenture at the time and place and at the
rate and in the money herein prescribed.
The Company shall have the right at any time, so long as the Company
is not in default in the payment of interest on the Securities of any series, to
extend interest payment periods on all of the Securities of this series for a
period of up to 60 consecutive months, but not beyond the Maturity thereof, and
at, or at any time prior to, the end of any such extended interest payment
period, the Company shall pay all interest then accrued and unpaid thereon
(together with interest thereon at the rate specified therefor to the extent
permitted by applicable law) in the same manner as provided for the payment of
Defaulted Interest in Section 307 of the Indenture; provided, however, that
during any such extended interest payment period the Company shall not, and
shall not permit any Affiliate directly or indirectly controlled by the Company
to, declare or pay any dividend on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any capital stock of the Company or such
Affiliate or make any guarantee payments with respect to the foregoing (other
than any guarantee payments by the Company with respect to any capital stock of
any such Affiliate, provided that the proceeds of such capital stock were used
to purchase Securities); provided further, however, that any such extended
interest payment period may only be selected with respect to the Securities of
this series if an extended interest payment period of identical length is
simultaneously selected for all Securities then Outstanding under the Indenture.
Prior to the termination of any such extended interest payment period, and
subject to the foregoing requirements, the Company may further extend such
period, provided that such period together with all such further extensions
thereof may not exceed a period of 60 consecutive months and subject to the
limitations described above. Following the termination of any such extended
interest payment period, if the Company has paid all accrued and unpaid interest
(together with interest at the rate specified for the Securities of this series
to the extent permitted by applicable law) required by the Securities for such
period, the Company shall have the right to again extend the interest payment
periods on the Securities of this series for up to 60 consecutive months as
provided above.
-9-
<PAGE>
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable by the registered holder
hereof on the Security Register of the Company, upon surrender of this Debenture
for registration of transfer at the office or agency of the Company in the
Borough of Manhattan, the City of New York accompanied by a written instrument
or instruments of transfer in form satisfactory to the Company and the Trustee
duly executed by the registered holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Securities of the same
series of authorized denominations and for the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of this Debenture, the
Company, the Trustee and any agent of the Company or the Trustee may deem and
treat the registered holder hereof as the absolute owner hereof (whether or not
this Debenture shall be overdue) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and (subject to the
provisions of the Indenture) interest due hereon and for all other purposes, and
neither the Company nor the Trustee nor any agent of the Company or the Trustee
shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
premium, if any, or the interest on this Debenture, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or director, past,
present or future, as such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations herein and
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series of a different
authorized denomination, as requested by the holder surrendering the same.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE FOUR
Other Matters
-------------
SECTION 4.01. (a) The Company designates its principal office in New
Haven, Connecticut as an office at which (i) the principal of and premium, if
any, and interest on the Debentures shall be payable, (ii) registration of
transfers and exchanges of the Debentures may be effected and (iii) notices and
demands to or upon the Company in respect of the Debentures and the Indenture
may be served.
-10-
<PAGE>
(b) The Company designates the office of The Bank of New York in New
York, New York shall be an office or agency of the Company at which (i)
registration of transfers and exchanges of the Debentures may be effected and
(ii) notices and demands to or upon the Company in respect of the Debentures and
the Indenture may be served.
(c) The Company designates (i) each of (A) its principal office in
New Haven, Connecticut and (B) the office of The Bank of New York in New York,
New York as an office or agency in which a register with respect to the
Debentures shall be maintained and (ii) itself as the Security Registrar with
respect to the Debentures.
SECTION 4.02. The proper officers of the Company may execute, with
the Paying Agent and any Authenticating Agent for the Debentures, one or more
Letters of Representations to the Depositary and any supplements or amendments
thereto necessary or desirable to make the Debentures eligible for deposit at
the Depositary; provided, however, that the Company reserves the right to
terminate any such Letter of Representations by one or more Officer's
Certificates; provided further, however, that the Company reserves the right to
enter into similar agreements with any other depositary with respect to the
Debentures by one or more Officer's Certificates.
ARTICLE FIVE
Miscellaneous Provisions
------------------------
SECTION 5.01. Except as otherwise expressly provided in this
Supplemental Indenture or in the form of Debenture or otherwise clearly required
by the context hereof or thereof, all terms used herein or in said form of
Debenture that are defined in the Indenture shall have the several meanings
respectively assigned to them thereby.
SECTION 5.02. The Indenture, as supplemented by this Supplemental
Indenture, is in all respects ratified and confirmed, and this Supplemental
Indenture shall be deemed part of the Indenture in the manner and to the extent
herein and therein provided.
SECTION 5.03. The recitals herein contained are made by the Company
and not by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representation as to the validity or
sufficiency of this Supplemental Indenture.
SECTION 5.04. This Supplemental Indenture may be executed in any
number of counterparts each of which shall be an original; but such counterparts
shall together constitute but one and the same instrument.
-11-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, on the date or dates indicated in the
acknowledgements and as of the day and year first above written.
THE UNITED ILLUMINATING COMPANY
By:____________________________
Attest:
________________________
THE BANK OF NEW YORK, as Trustee
By:____________________________
Attest:
________________________
-12-
<PAGE>
EXHIBIT 4.(j)
PAYMENT AND GUARANTEE AGREEMENT
PAYMENT AND GUARANTEE AGREEMENT ("Guarantee Agreement"), dated as of
________________, 1994, is executed and delivered by The United Illuminating
Company, a Connecticut corporation (the "Guarantor"), for the benefit of the
Holders (as defined below) from time to time of the Preferred Securities (as
defined below) of United Capital Funding Partnership L.P., a Delaware limited
partnership (the "Issuer").
WHEREAS, the Issuer will issue from time to time its limited partnership
interests in one or more series ("Preferred Securities"), and the Guarantor
desires to issue this Guarantee Agreement for the benefit of the Holders thereof
from time to time, as provided herein;
WHEREAS, the Issuer will loan the proceeds from the issuance and sale of
the Preferred Securities to the Guarantor in return for Debentures (as defined
below) that will be issued by the Guarantor pursuant to the Indenture (as
defined below); and
WHEREAS, the Guarantor desires hereby irrevocably and unconditionally to
agree to the extent set forth herein to pay to the Holders the Guarantee
Payments (as defined below) and to make certain other payments on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the purchase by each Holder of the
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders.
ARTICLE I
As used in this Guarantee Agreement, the terms set forth below shall,
unless the context otherwise requires, have the following meanings. Capitalized
terms used but not otherwise defined herein shall have the meanings assigned to
such terms in the Amended and Restated Agreement of Limited Partnership of the
Issuer dated as of _______________, 1994, as it may be amended from time to time
(the "Partnership Agreement").
"Additional Amounts" shall mean amounts of money payable in respect of
the Preferred Securities in order that the net amount of any payments received
by the holders of the Preferred Securities, after any withholding or deduction
of taxes, duties, assessments or governmental charges imposed or levied by or on
behalf of the United States, any state thereof, or any other jurisdiction
through which or from which such
<PAGE>
payments are made, or any authority thereon or thereof having power to tax, as a
consequence of (i) the Debentures not being treated as indebtedness for United
States Federal income tax purposes or (ii) the Issuer not being treated as a
partnership for United States Federal income tax purposes, will equal the
amounts of money that would have been receivable in respect of the Preferred
Securities in the absence of such withholding or deduction.
"Debentures" shall mean junior subordinated deferrable interest debentures of
the Guarantor issued in one or more series under the Indenture and having
certain payment terms that correspond to the terms of the related series of
Preferred Securities.
"Guarantee Payments" shall mean the following payments, without duplication,
to the extent not paid by the Issuer: (i) any accumulated and unpaid Dividends
on the Preferred Securities of any series, but only to the extent that the
Issuer has (a) funds legally available for the payment of such Dividends, as
determined by the General Partner, and (b) cash on hand sufficient to make such
payment; (ii) any unpaid Additional Amounts payable in respect of the Preferred
Securities of any series, but only to the extent that the Issuer has (2) funds
legally available for the payment of such Dividends, as determined by the
General Partner, and (b) cash on hand sufficient to make such payment; (iii) the
Redemption Price (as defined below) payable with respect to any Preferred
Securities called for redemption by the Issuer, but only to the extent that the
Issuer has (a) funds legally available for the payment of such Redemption Price,
as determined by the General Partner, and (b) cash on hand sufficient to make
such payment; and (iv) upon a liquidation of the Issuer, the lesser of (a) the
Liquidation Distribution (as defined below) and (b) the amount of assets of the
Issuer legally available to the Issuer for distribution to holders of Preferred
Securities.
"Holder" shall mean a Person in whose name an LP Certificate evidencing a
Preferred Security is registered on the books and records of the Issuer;
provided, however, that in determining whether the Holders of the requisite
percentage of Preferred Securities have given any request, notice, consent or
waiver hereunder, "Holder" shall not include the Guarantor or any Affiliate of
the Guarantor.
"Indenture" shall mean the Indenture, dated as of the date hereof, as it may
be amended and supplemented from time to time, between the Guarantor and The
Bank of New York, as trustee, pursuant to which the Guarantor will issue, among
other things, Debentures from time to time to evidence the loan or loans of the
proceeds received by the Issuer from (i) the issuance and sale from time to time
of the Preferred Securities and (ii) the related capital contributions made by
the Guarantor to the Issuer.
-2-
<PAGE>
"Liquidation Distribution" shall mean the aggregate of the liquidation
preference of $25 per Preferred Security, plus an amount equal to any
accumulated and unpaid Dividends, with any interest payable thereon, and any
unpaid Additional Amounts, to the date of payment.
"Redemption Price" shall mean $25 per Preferred Security, plus an amount equal
to any accumulated and unpaid Dividends, with any interest payable thereon, and
any unpaid Additional Amounts, to the date fixed for redemption.
ARTICLE II
SECTION 2.01. The Guarantor irrevocably and unconditionally agrees to
pay in full to the Holders the Guarantee Payments, as and when due, regardless
of any defense, right of set-off or counterclaim which the Issuer may have or
assert. The Guarantor's obligation to make a Guarantee Payment may be satisfied
by direct payment of the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION 2.02. All Guarantee Payments will be made without withholding
or deduction for or on account of any present or future taxes, duties,
assessments or governmental charges of whatever nature imposed or levied upon or
as a result of such payment by or on behalf of the United States, any state
thereof or any other jurisdiction through which or from which such payment is
made, or any authority therein or thereof having power to tax, unless the
withholding or deduction of such taxes, duties, assessments or governmental
charges is required by law. In the event that any such withholding or deduction
is required as a consequence of (i) the Debentures not being treated as
indebtedness for United States Federal income tax purposes or (ii) the Issuer
not being treated as a partnership for United States Federal income tax
purposes, the Guarantor will pay such additional amounts as may be necessary in
order that the net amounts received by the holders of the Preferred Securities
after such withholding or deduction will equal the amount that would have been
receivable in respect of the Preferred Securities in the absence of such
withholding or deduction, except that no such additional amounts will be payable
to a holder of Preferred Securities (or a third party on such holder's behalf)
if:
(a) such holder is liable for such taxes, duties, assessments or
governmental charges in respect of the Preferred Securities by reason of
such holder's having a connection with the United States, any state thereof
or any other jurisdiction through which or from which such payment is made,
or in which such holder resides, conducts business
-3-
<PAGE>
or has other contacts, other than being a holder of Preferred Securities,
or
(b) the Issuer or the Guarantor has notified such holder of the obligation
to withhold or deduct taxes and requested but not received from such holder
a declaration of non-residence, a valid taxpayer identification number or
other claim for exemption, and such withholding or deduction would not have
been required had such declaration, taxpayer identification number or claim
been received.
SECTION 2.03. The Guarantor hereby waives notice of acceptance of this
Guarantee Agreement and of any liability to which it applies or may apply,
presentment, demand for payment, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
SECTION 2.04. The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee Agreement shall in no way be affected or impaired
by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Preferred Securities
to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Dividends, Additional Amounts, Redemption Price, Liquidation
Distribution or any other sums payable under the terms of the Preferred
Securities, or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities (other than any extension arising out of a permitted extension
of any interest payment periods for the Debentures);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt, of, or other similar proceedings affecting, the
Issuer or any of the assets of the Issuer;
-4-
<PAGE>
(e) any invalidity of, or defect or deficiency in, any of the Preferred
Securities; or
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred.
There shall be no obligation of the Holders to give notice to, or obtain consent
of, the Guarantor with respect to the happening of any of the foregoing.
SECTION 2.05. This Guarantee Agreement is a guarantee of payment and not
of collection. A Holder may enforce this Guarantee Agreement directly against
the Guarantor, and the Guarantor hereby waives any right or remedy to require
that any action be brought against the Issuer or any other person or entity
before proceeding against the Guarantor. Subject to Section 2.06, all waivers
herein contained shall be without prejudice to the Holders' right at the
Holders' option to proceed against the Issuer, whether by separate action or by
joinder. The Guarantor agrees that this Guarantee Agreement shall not be
discharged except by payment of the Guarantee Payments in full and by complete
performance of all obligations of the Guarantor contained in this Guarantee
Agreement.
SECTION 2.06. The Guarantor hereby releases the Holders from all, and
agrees not to assert or enforce (whether by or in a legal or equitable
proceeding or otherwise) any, "claims" (as defined in Section 101(4) of the
United States Bankruptcy Code) against the Issuer, whether arising under
applicable law or otherwise, to which the Guarantor is or would at any time be
entitled (by virtue of its obligations hereunder or any payment made pursuant
hereto, including any such claims to which the Guarantor may be entitled as a
result of any right of subrogation or any indemnity, reimbursement or other
agreement); provided, however, that, to the extent such rights are not so
released, the Guarantor shall not (except to the extent required by mandatory
provisions of law) exercise any such rights (including by way of subrogation or
any indemnity, reimbursement or other agreement), in all cases as a result of a
payment under this Guarantee Agreement, if, at the time of any such payment, any
amounts are due and unpaid under this Guarantee Agreement. To the extent that
any amounts shall be paid to the Guarantor in violation of the preceding
sentence, such amounts shall be held in trust by the Guarantor for the benefit
of the Holders and not commingled with any of the Guarantor's other funds and
the Guarantor agrees to pay over such amounts to the Holders.
SECTION 2.07. The Guarantor acknowledges that its obligations hereunder
are independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and sole debtor
hereunder
-5-
<PAGE>
to make Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (f), inclusive, of Section 2.04 hereof.
SECTION 2.08. The Guarantor expressly acknowledges that (a) this
Guarantee Agreement will be deposited with the General Partner, to be held for
the benefit of the Holders, and (b) in the event of the appointment of a Special
Representative pursuant to the Partnership Agreement, such Special
Representative may enforce this Guarantee Agreement on behalf of the Holders and
take possession of this Guarantee Agreement for such purpose. The Guarantor,
upon request of such Special Representative, agrees to execute and deliver such
documents as may be necessary, appropriate or convenient for such Special
Representative with respect to such enforcement.
ARTICLE III
SECTION 3.01. So long as any Preferred Securities remain outstanding,
the Guarantor shall not, and shall not permit any Affiliate (as defined in the
Indenture) directly or indirectly owned by the Guarantor to, declare or pay any
dividend on, or redeem, purchase, acquire or make a liquidation payment with
respect to, any capital stock of the Guarantor or such affiliate, or make
any guarantee payments with respect to the foregoing (other than payments under
this Guarantee Agreement), if at such time the Guarantor shall be in default
with respect to its payment or other obligations hereunder or there shall have
occurred and be continuing any event that, with notice or lapse of time or both,
would become an Event of Default (as defined in the Indenture) under the
Indenture. The Guarantor will take all actions necessary to ensure that its
subsidiaries comply with this Section 3.01.
SECTION 3.02. The Guarantor covenants, so long as any Preferred
Securities remain outstanding, that it will: (i) maintain direct or indirect
ownership of any and all partnership interests in the Issuer other than the
Preferred Securities, (ii) not voluntarily (to the extent permitted by law)
dissolve, liquidate or wind-up the Issuer; (iii) remain the sole General Partner
of the Issuer and timely perform all of its duties as General Partner of the
Issuer (including the duty to declare and pay dividends on the Preferred
Securities and the duty to pay all costs and expenses of the Issuer), provided
that any permitted successor of the Guarantor under the Indenture may succeed to
the Guarantor's duties as General Partner; (iv) use its reasonable efforts to
cause the Issuer to remain a limited partnership and otherwise continue to be
treated as a partnership for Federal income tax purposes; and (v) use its best
efforts to conduct the
-6-
<PAGE>
affairs of and operate the Issuer in such a way that the Issuer would not be an
"investment company" required to be registered under the Investment Company Act
of 1940, as amended; provided that the Guarantor may permit the Issuer to
consolidate or merge with or into another limited partnership or other permitted
successor in accordance with the terms and provisions of the Partnership
Agreement, so long as the Guarantor agrees to comply with the covenants set
forth in (i) through (v) above with respect to such successor limited
partnership or other permitted successor.
SECTION 3.03. This Guarantee Agreement will constitute an unsecured
obligation of the Guarantor and will rank subordinate in right of payment to all
Senior Indebtedness (as defined in the Indenture), but senior in right of
payment to all of the Guarantor's preferred and common stock. Each Holder shall
be deemed to agree, by its acceptance hereof, and likewise covenants and agrees
that (1) any amounts payable hereunder are hereby expressly subordinated, to the
same extent as payments of principal of and premium, if any, and interest on
each and all of the Debentures issued under the Indenture, in right of payment
to payment of all Senior Indebtedness, and (2) it accepts the provisions of
Article Fifteen of the Indenture applicable to and binding the Debenture
holders, as if it were a Debenture holder and such provisions applied to it and
to the same extent that such provisions apply to and bind the Debenture holders.
ARTICLE IV
This Guarantee Agreement shall terminate and be of no further force and
effect upon full payment of the Redemption Price of all Preferred Securities or
upon full payment of the Liquidation Distribution with respect to all Preferred
Securities upon liquidation of the Issuer; provided, however, that this
Guarantee Agreement shall continue to be effective or shall be reinstated, as
the case may be, if at any time any Holder of Preferred Securities must restore
payment of any sums paid under the Preferred Securities or under this Guarantee
Agreement for any reason whatsoever.
ARTICLE V
SECTION 5.01. All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall enure to the benefit of the Holders.
The Guarantor may not assign any of its rights or obligations under this
Guarantee Agreement, except as contemplated by and in accordance with Article
Eleven of the Indenture.
-7-
<PAGE>
SECTION 5.02. Except with respect to any changes that do not adversely
affect the rights of holders of Preferred Securities of any series (in which
case no vote will be required), this Guarantee Agreement may only be amended by
an instrument in writing signed by the Guarantor with the prior approval of the
Holders of not less than 66-2/3 % in aggregate liquidation preference of the
outstanding Preferred Securities of each such affected series (voting together
as one class), obtained in the manner provided in the Partnership Agreement.
SECTION 5.03. Any notice, request or other communication required or
permitted to be given hereunder to the Guarantor shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail) or telex, addressed to the Guarantor, as follows (and if so
given, shall be deemed given when mailed or upon receipt of an answer-back, if
sent by telex):
The United Illuminating Company
157 Church Street
P.O. Box 1564
New Haven, CT 06506-0901
Facsimile No.: (203) 499-2414
Attention: Treasurer and Secretary
Any notice, request or other communication required or permitted to be
given hereunder to the Holders shall be given by the Guarantor in the same
manner as notices sent by the Issuer to the Holders.
SECTION 5.04. This Guarantee Agreement is solely for the benefit of the
Holders and is not separately transferable from the Preferred Securities.
SECTION 5.05. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
This Guarantee Agreement is executed as of the day and year first above
written.
THE UNITED ILLUMINATING COMPANY
By ________________________
Name:
Title:
-8-
<PAGE>
EXHIBIT 12
Page 1 of 2
THE UNITED ILLUMINATING COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(In Thousands)
<TABLE>
<CAPTION>
Twelve
Months
Year Ended December 31, Ended
------------------------------------------------------------------------------ June 30,
1989 1990 1991 1992 1993 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
EARNINGS
Net Income (Loss) $(73,350) $ 54,048 $ 55,550 $ 56,768 $ 40,481 $ 35,873
Federal Income Taxes (64,216) 17,053 20,844 19,276 22,342 22,989
Connecticut Corp. Bus. Tax (18,560) 9,037 12,647 16,878 4,645 4,959
Fixed charges 118,778 115,997 107,548 109,449 97,928 92,185
-------- -------- -------- -------- -------- --------
Earnings available
for fixed charges(1) $(37,348) $196,135 $196,589 $202,371 $165,396 $156,006
======== ======== ======== ======== ======== ========
FIXED CHARGES
Interest on long-term debt $ 91,126 $ 94,056 $ 90,296 $ 88,666 $ 80,030 $ 76,971
Other Interest 22,849 15,468 9,847 12,882 12,260 10,469
Interest on nuclear fuel burned 211 1,533 2,440 2,963 928 352
One third of rental charges 4,592 4,940 4,965 4,938 4,710 4,393
-------- -------- -------- -------- -------- --------
$118,778 $115,997 $107,548 $109,449 $ 97,928 $ 92,185
======== ======== ======== ======== ======== ========
RATIO OF EARNINGS TO FIXED -- 1.69 1.83 1.85 1.69 1.69
CHARGES -------- -------- -------- -------- -------- --------
DEFICIENCY OF EARNINGS TO
FIXED CHARGES $156,126 -- -- -- -- --
======== ======== ======== ======== ======== ========
- - - ------------
</TABLE>
(1) Reflects the after-tax effects of write-offs of costs of nuclear generating
units pursuant to SFAS No. 90 of ($1,551,000), ($1,965,000), ($2,304,000)
and $152,147,000 for the twelve months ended December 31, 1992, 1991, 1990
and 1989, respectively.
<PAGE>
EXHIBIT 12
Page 2 of 2
THE UNITED ILLUMINATING COMPANY
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
(In Thousands)
<TABLE>
<CAPTION>
Twelve
Months
Year Ended December 31, Ended
------------------------------------------------------------------------------ June 30,
1989 1990 1991 1992 1993 1994
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
EARNINGS
Net Income (Loss) $(73,350) $ 54,048 $ 55,550 $ 56,768 $ 40,481 $ 35,873
Federal Income Taxes (64,216) 17,053 20,844 19,276 22,342 22,989
Connecticut Corp. Bus. Tax (18,560) 9,037 12,647 16,878 4,645 4,959
Fixed Charges 118,778 115,997 107,548 109,449 97,928 92,185
-------- -------- -------- -------- -------- --------
Earnings available for
combined fixed charges and
preferred stock dividend
requirements (1) $(37,348) $196,135 $196,589 $202,371 $165,396 $156,006
======== ======== ======== ======== ======== ========
FIXED CHARGES AND PREFERRED
STOCK DIVIDEND REQUIREMENTS
Interest on long-term debt $ 91,126 $ 94,056 $ 90,296 $ 88,666 $ 80,030 $ 76,971
Other Interest 22,849 15,468 9,847 12,882 12,260 10,469
Interest on nuclear fuel burned 211 1,533 2,440 2,963 928 352
One third of rental charges 4,592 4,940 4,965 4,938 4,710 4,393
Preferred Stock
Dividend Requirements (2) 15,331 7,049 7,260 7,100 7,197 7,096
-------- -------- -------- -------- -------- --------
$134,109 $123,046 $114,808 $116,549 $105,125 $ 99,281
======== ======== ======== ======== ======== ========
RATIO OF EARNINGS TO FIXED
CHARGES AND PREFERRED
STOCK DIVIDEND REQUIREMENTS -- 1.59 1.71 1.74 1.57 1.57
-------- -------- -------- -------- -------- --------
DEFICIENCY OF EARNINGS TO
COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDEND
REQUIREMENTS $171,457 -- -- -- -- --
======== ======== ======== ======== ======== ========
- - - ------------
</TABLE>
(1) Reflects the after-tax effects of write-offs of costs of nuclear generating
units pursuant to SFAS No. 90 of ($1,551,000), ($1,965,000), ($2,304,000)
and $152,147,000 for the twelve months ended December 31, 1992, 1991, 1990
and 1989, respectively.
(2) Preferred Stock Dividends increased to reflect the pre-tax earnings
required to cover such dividend requirements.
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement of
The United Illuminating Company on Form S-3 (File No. ) of our report dated
January 24, 1994, on our audits of the consolidated financial statements and
financial statement schedules of The United Illuminating Company as of December
31, 1993, 1992 and 1991, and for the three years then ended which report is
included in the Annual Report on Form 10-K. We also consent to the reference to
our Firm under the caption "Experts".
/s/ Coopers & Lybrand L.L.P.
Hartford, Connecticut
September 12, 1994
<PAGE>
CONFORMED COPY
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
------------------
THE UNITED ILLUMINATING COMPANY
(Exact name of obligor as specified in its charter)
Connecticut 25-071808
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
157 Church Street
New Haven, Connecticut 06506-0901
(Address of principal executive offices) (Zip code)
------------------
The United Illuminating Company Junior Subordinated
Deferrable Interest Debentures
(Title of the indenture securities)
================================================================================
<PAGE>
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.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such affilia-
tion.
None. (See Note on page 3.)
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the
Commission's Rules of Practice.
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
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<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the
Trustee of all facts on which to base a responsive answer to Item 2, the answer
to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
- 3 -
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank 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 12th day of September, 1994.
THE BANK OF NEW YORK
By: /s/ ROBERT F. MCINTYRE
-----------------------------------
Name: Robert F. McIntyre
Title: Assistant Vice President
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<PAGE>
Exhibit 7
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Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business
June 30, 1994, published in accordance with a call made by the
Federal Reserve Bank of this District pursuant to the provisions
of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin .................. $ 7,071,756
Interest-bearing balances .......... 695,722
Securities:
Held-to-maturity securities ........ 1,396,356
Available-for-sale securities ...... 1,495,522
Federal funds sold in domestic
offices of the bank ................ 874,129
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................25,607,366
LESS: Allowance for loan and
lease losses ..............688,226
LESS: Allocated transfer risk
reserve .....................29,781
Loans and leases, net of unearned
income, allowance, and reserve 24,889,359
Assets held in trading accounts ...... 2,427,515
Premises and fixed assets (including
capitalized leases) ................ 634,514
Other real estate owned .............. 51,996
Investments in unconsolidated
subsidiaries and associated
companies .......................... 164,558
Customers' liability to this bank on
acceptances outstanding ............ 1,212,402
Intangible assets .................... 80,153
Other assets ......................... 1,512,404
-----------
Total assets ......................... $42,506,386
===========
LIABILITIES
Deposits:
In domestic offices ................ $19,454,858
Noninterest-bearing .......7,576,391
Interest-bearing .........11,878,467
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ... 10,753,958
Noninterest-bearing ..........51,653
Interest-bearing .........10,702,305
Federal funds purchased and secu-
rities sold under agreements to re-
purchase in domestic offices of
the bank and of its Edge and
Agreement subsidiaries, and in
IBFs:
Federal funds purchased ............ 1,150,270
Securities sold under agreements
to repurchase .................... 49,603
Demand notes issued to the U.S.
Treasury ........................... 300,000
Trading liabilities .................. 1,757,487
Other borrowed money:
With original maturity of one year
or less .......................... 2,452,009
With original maturity of more than
one year ......................... 33,969
Bank's liability on acceptances exe-
cuted and outstanding .............. 1,212,877
Subordinated notes and debentures .... 1,062,320
Other liabilities .................... 1,348,031
-----------
Total liabilities .................... 39,575,382
-----------
EQUITY CAPITAL
Common stock ........................ 942,284
Surplus ............................. 525,666
Undivided profits and capital
reserves .......................... 1,495,590
Net unrealized holding gains
(losses) on available-for-sale
securities ........................ ( 26,172)
Cumulative foreign currency transla-
tion adjustments .................. ( 6,364)
-----------
Total equity capital ................ 2,931,004
-----------
Total liabilities and equity
capital ........................... $42,506,386
===========
I, Robert E. Keilman, Senior Vice President and Comptroller of
the above-named bank do hereby declare that this Report of
Condition has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this
Report of Condition 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 Board of Governors
of the Federal Reserve System and is true and correct.
Alan R. Griffith )
Thomas A. Renyi ) Directors
J. Carter Bacot )
