<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 18, 1995
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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WILLIAMS HOLDINGS OF DELAWARE, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 73-1455707
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
ONE WILLIAMS CENTER
TULSA, OKLAHOMA 74172
(918) 588-2000
(Address, including zip code, and telephone number, including
area code of registrant's principal executive offices)
---------------------
J. FURMAN LEWIS, ESQ.
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
THE WILLIAMS COMPANIES, INC.
ONE WILLIAMS CENTER
TULSA, OKLAHOMA 74172
(918) 588-2000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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COPY TO:
RANDALL H. DOUD, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM
919 THIRD AVENUE
NEW YORK, NEW YORK 10022
(212) 735-3000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this Registration Statement becomes effective.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. /X/
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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PROPOSED
TITLE OF EACH PROPOSED MAXIMUM
CLASS OF MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO AMOUNT TO OFFERING PRICE OFFERING REGISTRATION
BE REGISTERED BE REGISTERED PER UNIT PRICE(1) FEE
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<S> <C> <C> <C> <C>
Debt Securities....... (2) (2) $400,000,000 $137,932
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</TABLE>
(1) Estimated solely for the purpose of determining the registration fee.
(2) Not applicable pursuant to Form S-3 General Instruction II(D) under the
Securities Act of 1933.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
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<PAGE> 2
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* *
* 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 STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
SUBJECT TO COMPLETION, DATED OCTOBER 18, 1995
PROSPECTUS
WILLIAMS HOLDINGS OF DELAWARE, INC.
DEBT SECURITIES
---------------------
Williams Holdings of Delaware, Inc. (the "Company") may offer and sell from
time to time unsecured debentures, notes or other evidences of indebtedness
("Debt Securities"), with an initial offering price not to exceed $400,000,000
in the aggregate (or the equivalent in foreign denominated currency or units
based on or related to currencies, including European Currency Units). All
specific terms of the offering and sale of the Debt Securities, including the
specific designation, rights and restrictions and whether the Debt Securities
are senior or subordinated, the currencies or composite currencies in which the
Debt Securities are denominated, the aggregate principal amount, the maturity,
rate and time of payment of interest, and any conversion, exchange, redemption
or sinking fund provisions, and initial public offering price, listing on any
securities exchange, and the agents, dealers or underwriters, if any, to be
utilized in connection with the sale of the Debt Securities, will be set forth
in an accompanying Prospectus Supplement (the "Prospectus Supplement"). The Debt
Securities may be sold for U.S. dollars, foreign denominated currency or
currency units; principal of and any interest may likewise be payable in U.S.
dollars, foreign denominated currency or currency units -- in each case, as the
Company specifically designates. The managing underwriters with respect to each
series sold to or through underwriters will be named in the Prospectus
Supplement.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
---------------------
The Debt Securities may be offered through dealers, through underwriters or
through agents designated from time to time as set forth in the Prospectus
Supplement. Net proceeds to the Company will be the purchase price in the case
of a dealer, the public offering price less discount in the case of an
underwriter or the purchase price less commission in the case of an agent -- in
each case, less other expenses attributable to issuance and distribution. See
"Plan of Distribution" for possible indemnification arrangements for dealers,
underwriters and agents.
This Prospectus does not constitute an offer to sell or the solicitation of
an offer to buy any of the securities other than the Debt Securities described
in the accompanying Prospectus Supplement.
, 1995
<PAGE> 3
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") in Washington, D.C., a Registration Statement on Form S-3 under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Debt Securities offered hereby. Certain portions of the Registration
Statement have not been included in this Prospectus as permitted by the
Commission's rules and regulations. For further information, reference is made
to the Registration Statement and the exhibits thereto. The Company 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 Commission. The Registration Statement (with
exhibits), as well as such reports and other information filed by the Company
with the Commission, can be inspected and copied at the public reference
facilities maintained by the Commission at its principal offices at Judiciary
Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and its
regional offices at Northwest Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511 and 7 World Trade Center, Suite 1300, New
York, New York 10048. Copies of such material can be obtained at prescribed
rates from the Public Reference Section of the Commission at its principal
office at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
---------------------
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY UNDERWRITER, DEALER OR AGENT. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE DEBT SECURITIES IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH
JURISDICTION.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Registration Statement on Form 10 filed by the Company with the
Commission pursuant to Section 12(g) of the Exchange Act (the "Form 10") is
incorporated in and made a part of this Prospectus by reference.
All documents filed by the Company pursuant to Section 13, 14 or 15(d) of
the Exchange Act after the date of this Prospectus and prior to the termination
of this offering shall be deemed to be incorporated by reference in this
Prospectus and to be a part hereof from the date of filing of such documents.
The Company undertakes to provide without charge to each person to whom a
copy of this Prospectus has been delivered, upon the written or oral request of
any such person, a copy of any or all of the documents incorporated by reference
herein, other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into the information that this Prospectus
incorporates. Written or oral requests for such copies should be directed to:
Williams Holdings of Delaware, Inc., One Williams Center, Tulsa, Oklahoma 74172,
Attention: Corporate Secretary, (918) 588-2000.
REPORTS TO HOLDERS OF DEBT SECURITIES
The Company is not required to publish annual and quarterly reports to
stockholders. The Company's annual report on Form 10-K containing audited
financial statements will be provided to holders of Debt Securities upon
request.
---------------------
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS, IF ANY, MAY OVERALLOT
OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE DEBT
SECURITIES OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY
TIME.
2
<PAGE> 4
THE COMPANY
Williams Holdings of Delaware, Inc. (the "Company"), was incorporated under
the laws of the State of Delaware in July 1994. The principal executive offices
of the Company are located at One Williams Center, Tulsa, Oklahoma 74172
(telephone (918) 588-2000). Unless the context otherwise requires, references to
the Company herein include subsidiaries of the Company. The Company is a
wholly-owned subsidiary of The Williams Companies, Inc. ("Williams").
The Company, through subsidiaries, is engaged in natural gas gathering,
processing and production, the transportation of petroleum products, marketing
of natural gas and natural gas liquids and provides a variety of other products
and services to the energy industry. The Company's telecommunications
subsidiaries offer data, voice and video-related products and services and
customer premise equipment nationwide. The Company also has certain other equity
investments. Virtually all of the Company's assets have been transferred to the
Company by Williams since January 1, 1995, and were previously operated by
subsidiaries of Williams.
As indicated, substantially all of the Company's operations are conducted
through subsidiaries. Williams performs management, legal, financial, tax,
consultative, administrative and other services for its subsidiaries. The
Company's principal sources of cash will be from external financings, dividends
and advances from its subsidiaries, advances from Williams, investments and
interest payments from subsidiaries and Williams on cash advances. The amount of
dividends available to the Company from subsidiaries largely depends on each
subsidiary's earnings and capital requirements. Certain subsidiaries' debt
instruments with outside lenders limit the amount of dividend payments and
advances to the Company.
USE OF PROCEEDS
Unless otherwise indicated in the applicable Prospectus Supplement, the net
proceeds from the sale of the Debt Securities will be used for general corporate
purposes, including funding of the Company's capital program. The Company
anticipates that it will raise additional funds from time to time through debt
financings, including borrowings under its bank Credit Agreement.
RATIO OF EARNINGS TO FIXED CHARGES
The following table represents the Company's consolidated ratio of earnings
to fixed charges for the periods shown.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, 1995 1994 1993 1992 1991 1990
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<S> <C> <C> <C> <C> <C>
3.41 6.71 14.10 2.86 1.60 2.47
</TABLE>
For the purpose of this ratio: (i) earnings consist of income from
continuing operations before fixed charges and income taxes for the Company, its
majority-owned subsidiaries and its proportionate share of 50 percent-owned
companies, less undistributed earnings of less than 50 percent-owned companies
and (ii) fixed charges consist of interest and debt expense on all indebtedness
(without reduction of interest capitalized) and that portion of rental payments
on operating leases estimated to represent an interest factor, plus the pretax
effect of preferred dividends of subsidiaries. The ratio of earnings to fixed
charges is higher in the years 1993 and 1994 as compared to the other years
presented primarily because of gains on sales of assets and higher operating
profit.
3
<PAGE> 5
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF THE COMPANY
The following selected income statement data for the years 1994, 1993 and
1992 and balance sheet data for 1994 and 1993 have been derived from the
Company's audited consolidated financial statements appearing in the Form 10 and
incorporated herein by reference. The selected income statement data for the
six-month periods ended June 30, 1995 and 1994 and the balance sheet data for
June 30, 1995, have been derived from the Company's unaudited consolidated
financial statements appearing in the Form 10 and incorporated herein by
reference. The selected income statement data for the years 1991 and 1990 and
balance sheet data for 1992, 1991 and 1990 have been derived from the Company's
consolidated financial statements not appearing elsewhere herein or in the Form
10. The selected historical consolidated financial data shown below should be
read in conjunction with the consolidated financial statements of the Company
and related notes and the related audit report appearing in the Form 10 and
incorporated herein by reference.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
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1995(2) 1994 1994 1993 1992 1991 1990
------- ------ ------- ------- ------- ------- -------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:(1)
Total revenues............................... $1,047.9 $584.0 $1,264.3 $1,221.0 $1,283.2 $ 929.8 $ 705.8
Income from continuing operations............ 100.1(6) 76.3(3) 125.5(3) 152.3(4) 46.9(5) 20.7 23.5
Income from discontinued operations.......... 1,005.7 28.3 94.0 46.4 25.2 40.3 41.1
Net income................................... 1,105.8 98.5 213.4 198.7 83.2 61.0 64.6
BALANCE SHEET DATA:(1)
Property, plant and equipment -- net......... 1,897.6 1,585.1 2,151.1 2,157.3 1,651.8 1,532.2
Total assets................................. 3,993.4 3,440.1 2,989.4 2,869.9 2,316.2 2,089.0
Long-term debt............................... 124.2 507.0 229.4 337.1 375.9 518.4
Stockholder's equity......................... $2,143.4 $1,739.9 $1,818.0 $1,614.6 $1,262.0 $ 943.2
RATIO OF EARNINGS TO FIXED CHARGES(7)........ 3.41 6.71 14.10 2.86 1.60 2.47
</TABLE>
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(1) In the third quarter of 1994, the Company signed a definitive agreement to
enter into the sale of its network services operations (the "WNS Sale"). On
January 5, 1995, the Company consummated the transaction and the gain from
the sale was reported as discontinued operations in the 1995 first quarter
consolidated financial statements. The selected historical consolidated
financial data has been prepared to present operating results of the
operations sold in the WNS Sale as discontinued operations. Prior period
balance sheets have not been restated. For additional information see Note 2
of the Notes to Audited Consolidated Financial Statements of the Company
appearing in the Form 10 and incorporated herein by reference.
(2) On January 18, 1995, Williams acquired 60 percent of the outstanding common
stock of Transco Energy Company (Transco) in a cash tender offer. On May 1,
1995, the remaining 40 percent of Transco's outstanding common stock was
acquired through a merger, which involved the exchange of the remaining
Transco common stock for approximately 10.2 million shares of Williams
common stock. Williams then contributed the stock of Transco and Transco's
subsidiaries, except subsidiaries holding Transco's interstate natural gas
pipelines, to the Company. The consolidated financial statements as of and
for the six months ended June 30, 1995, reflect this contribution from
Williams effective January 18, 1995.
(3) Includes a pretax gain on sales of assets of $22.7 million. See Note 4 of
the Notes to Audited Consolidated Financial Statements of the Company
appearing in the Form 10 and incorporated herein by reference.
(4) Includes a pretax gain on sales of assets of $97.5 million. See Note 4 of
the Notes to Audited Consolidated Financial Statements of the Company
appearing in the Form 10 and incorporated herein by reference.
(5) Includes a pretax gain on sales of assets of $14.6 million. See Note 4 of
the Notes to Audited Consolidated Financial Statements of the Company
appearing in the Form 10 and incorporated herein by reference.
(6) Includes a pretax loss on sales of investments of $12.6 million. See Note 4
of the Notes to Unaudited Consolidated Financial Statements of the Company
for the six months ended June 30, 1995, appearing in the Form 10 and
incorporated herein by reference.
(7) For the purpose of this ratio (i) earnings consist of income from continuing
operations before fixed charges and income taxes for the Company, its
majority owned subsidiaries and its proportionate share of 50 percent-owned
companies, less undistributed earnings of less than 50 percent-owned
companies; and (ii) fixed charges consist of interest and debt expense on
all indebtedness (without reduction of interest capitalized) and that
portion of rental payments on operating leases estimated to represent an
interest factor, plus the pretax effect of preferred dividends of
subsidiaries. The ratio of earnings to fixed charges is higher in the years
1993 and 1994 as compared to the other years presented primarily because of
gains on sales of assets and higher operating profit.
4
<PAGE> 6
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will constitute either senior or subordinated debt of
the Company and will be issued, in the case of Debt Securities that will be
senior debt, under an indenture (the "Senior Debt Indenture"), between the
Company and Citibank, N.A., as Trustee, and, in the case of Debt Securities that
will be subordinated debt, under an indenture (the "Subordinated Debt
Indenture"), between the Company and Citibank, N.A., as Trustee. The Senior Debt
Indenture and the Subordinated Debt Indenture are sometimes hereinafter referred
to individually as an "Indenture" and collectively as the "Indentures."
Citibank, N.A. is hereinafter referred to as the "Trustee." The forms of the
Indentures are filed as exhibits to the Registration Statement of which this
Prospectus is a part. The following summaries of certain provisions of the
Indentures and the Debt Securities do not purport to be complete and such
summaries are subject to the detailed provisions of the applicable Indenture to
which reference is hereby made for a full description of such provisions,
including the definition of certain terms used herein, and for other information
regarding the Debt Securities. Numerical references in parentheses below are to
sections in the applicable Indenture. Wherever particular sections or defined
terms of the applicable Indenture are referred to, such sections or defined
terms are incorporated herein by reference as part of the statement made, and
the statement is qualified in its entirety by such reference. The Indentures are
substantially identical, except for the provisions relating to subordination and
the Company's limitation on liens. See "Subordinated Debt" and "Certain
Covenants of the Company." Neither Indenture contains any covenant or provisions
which affords debt holders protection in the event of a highly leveraged
transaction.
CERTAIN DEFINITIONS
Certain terms defined in Article One of the Indentures are summarized as
follows:
"Consolidated Funded Indebtedness" means the aggregate of all
outstanding Funded Indebtedness of the Company and its consolidated
Subsidiaries, determined on a consolidated basis in accordance with
generally accepted accounting principles.
"Consolidated Net Tangible Assets" means the total assets appearing on
a consolidated balance sheet of the Company and its consolidated
Subsidiaries less, in general: (i) intangible assets; (ii) current and
accrued liabilities (other than Consolidated Funded Indebtedness and
capitalized rentals or leases), deferred credits, deferred gains and
deferred income; (iii) reserves; (iv) advances to finance oil or natural
gas exploration and development to the extent that the indebtedness related
thereto is excluded from Funded Indebtedness; (v) an amount equal to the
amount excluded from Funded Indebtedness representing "production payment"
financing of oil or natural gas exploration and development; and (vi)
minority stockholder interests.
"Funded Indebtedness" means any Indebtedness which matures more than
one year after the date as of which Funded Indebtedness is being determined
less any such Indebtedness as will be retired through or by means of any
deposit or payment required to be made within one year from such date under
any prepayment provision, sinking fund, purchase fund or otherwise;
provided, however, that such term shall not include Indebtedness of the
Company or any of its Subsidiaries incurred to finance outstanding advances
to others to finance oil or natural gas exploration and development to the
extent that the latter are not in default in their obligations to the
Company or such Subsidiary, nor shall such term include Indebtedness of the
Company or any of its Subsidiaries incurred to finance oil or natural gas
exploration and development by means commonly referred to as a "production
payment" to the extent that the Company or any of its Subsidiaries have not
guaranteed the repayment of the production payment.
"Holder" means, in general, a Person in whose name the Securities are
registered, or, if not registered, the bearer thereof.
"Indebtedness" means indebtedness which is for money borrowed from
others.
"Person" means any individual, corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
5
<PAGE> 7
"Subsidiary" means any corporation at least a majority of the
outstanding securities of which having ordinary voting power shall be owned
by the Company and/or another Subsidiary or Subsidiaries.
GENERAL
Neither of the Indentures limits the amount of Debt Securities, debentures,
notes or other evidences of indebtedness that may be issued by the Company or
any of its Subsidiaries. The Debt Securities will be unsecured senior or
subordinated obligations of the Company. All of the operating assets of the
Company and its Subsidiaries are owned by its Subsidiaries. Therefore, the
Company's rights and the rights of its creditors, including Holders of Debt
Securities, to participate in the assets of any Subsidiary upon the latter's
liquidation or recapitalization will be subject to the prior claims of the
Subsidiary's creditors, except to the extent that the Company may itself be a
creditor with recognized claims against the Subsidiary. The ability of the
Company to pay principal of and interest on the Debt Securities is, to a large
extent, dependent upon the receipt by it of dividends or other payments from its
Subsidiaries. Dividends payable by Williams Pipe Line Company, one of the
principal subsidiaries of the Company, are restricted under that company's
current debt agreements.
The Indentures provide that Debt Securities may be issued from time to time
in one or more series and may be denominated and payable in foreign currencies
or units based on or relating to foreign currencies, including European Currency
Units. Special United States federal income tax considerations applicable to any
Debt Securities so denominated are described in the relevant Prospectus
Supplement.
Reference is made to the Prospectus Supplement for the following terms of
and information relating to the Debt Securities (to the extent such terms are
applicable to such Debt Securities): (i) classification as senior or
subordinated Debt Securities, the specific designation, aggregate principal
amount, purchase price and denomination; (ii) currency or units based on or
relating to currencies in which such Debt Securities are denominated and/or in
which principal, premium, if any, and/or any interest will or may be payable;
(iii) any date of maturity; (iv) interest rate or rates (or method by which such
rate will be determined), if any; (v) the dates on which any such interest will
be payable; (vi) the place or places where the principal of and interest, if
any, on the Debt Securities will be payable; (vii) any redemption or sinking
fund provisions; (viii) whether the Debt Securities will be issuable in
registered or bearer form or both and, if Debt Securities in bearer form are
issuable, restrictions applicable to the exchange of one form for another and to
the offer, sale and delivery of Debt Securities in bearer form; (ix) any
applicable United States federal income tax consequences, including whether and
under what circumstances the Company will pay additional amounts on Debt
Securities held by a Person who is not a U.S. Person (as defined in the
Prospectus Supplement) in respect of any tax, assessment or governmental charge
withheld or deducted, and if so, whether the Company will have the option to
redeem such Debt Securities rather than pay such additional amounts; and (x) any
other specific terms of the Debt Securities, including any additional events of
default or covenants provided for with respect to such Debt Securities, and any
terms which may be required by or advisable under United States laws or
regulations.
Debt Securities may be presented for exchange, and registered Debt
Securities may be presented for transfer in the manner, at the places and
subject to the restrictions set forth in the Debt Securities and the Prospectus
Supplement. Such services will be provided without charge, other than any tax or
other governmental charge payable in connection therewith, but subject to the
limitations provided in the applicable Indenture. Debt Securities in bearer form
and the coupons, if any, appertaining thereto will be transferable by delivery.
Debt Securities that bear interest will do so at a fixed rate or a floating
rate. Debt Securities bearing no interest or interest at a rate that at the time
of issuance is below the prevailing market rate will be sold at a discount below
their stated principal amount. Special United States federal income tax
considerations applicable to any such discounted Debt Securities or to certain
Debt Securities issued at par which are treated as having been issued at a
discount for United States federal income tax purposes will be described in the
relevant Prospectus Supplement.
6
<PAGE> 8
REGISTERED GLOBAL SECURITIES
The registered Debt Securities of a series may be issued in the form of one
or more fully registered global Securities (a "Registered Global Security") that
will be deposited with a depositary (the "Depositary"), or with a nominee for a
Depositary identified in the Prospectus Supplement relating to such series. In
such case, one or more Registered Global Securities will be issued in a
denomination or aggregate denominations equal to the portion of the aggregate
principal amount of outstanding registered Debt Securities of the series to be
represented by such Registered Global Security or Securities. Unless and until
it is exchanged in whole or in part for Debt Securities in definitive registered
form, a Registered Global Security may not be transferred except as a whole by
the Depositary for such Registered Global Security to a nominee of such
Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor of such Depositary or a nominee of such successor.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Registered Global
Security will be described in the Prospectus Supplement relating to such series.
The Company anticipates that the following provisions will apply to all
depositary arrangements.
Upon the issuance of a Registered Global Security, the Depositary for such
Registered Global Security will credit, on its book-entry registration and
transfer system, the respective principal amounts of the Debt Securities
represented by such Registered Global Security to the accounts of Persons that
have accounts with such Depositary ("participants"). The accounts to be credited
shall be designated by any underwriters or agents participating in the
distribution of such Debt Securities. Ownership of beneficial interests in a
Registered Global Security will be limited to participants or Persons that may
hold interests through participants. Ownership of beneficial interests in such
Registered Global Security will be shown on, and the transfer of that ownership
will be effected only through, records maintained by the Depositary for such
Registered Global Security (with respect to interests of participants) or by
participants or Persons that hold through participants (with respect to
interests of Persons other than participants). So long as the Depositary for a
Registered Global Security, or its nominee, is the registered owner of such
Registered Global Security, such Depositary or such nominee, as the case may be,
will be considered the sole owner or Holder of the Debt Securities represented
by such Registered Global Security for all purposes under the applicable
Indenture. Except as set forth below, owners of beneficial interests in a
Registered Global Security will not be entitled to have the Debt Securities
represented by such Registered Global Security registered in their names, will
not receive or be entitled to receive physical delivery of such Debt Securities
in definitive form and will not be considered the owners or Holders thereof
under the applicable Indenture.
Principal, premium, if any, and interest payments on Debt Securities
represented by a Registered Global Security registered in the name of a
Depositary or its nominee will be made to such Depositary or its nominee, as the
case may be, as the registered owner of such Registered Global Security. None of
the Company, the Trustees or any paying agent for such Debt Securities will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in such Registered
Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
The Company expects that the Depositary for any Debt Securities represented
by a Registered Global Security, upon receipt of any payment of principal,
premium or interest, will immediately credit participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of such Registered Global Security as shown on the records
of such Depositary. The Company also expects that payments by participants to
owners of beneficial interests in such Registered Global Security held through
such participants will be governed by standing instructions and customary
practices, as is now the case with the securities held for the accounts of
customers registered in "street names" and will be the responsibility of such
participants.
If the Depositary for any Debt Securities represented by a Registered
Global Security is at any time unwilling or unable to continue as Depositary and
a successor Depositary is not appointed by the Company within ninety days, the
Company will issue such Debt Securities in definitive form in exchange for such
Registered Global Security. In addition, the Company may at any time and in its
sole discretion determine not
7
<PAGE> 9
to have any of the Debt Securities of a series represented by one or more
Registered Global Securities and, in such event, will issue Debt Securities of
such series in definitive form in exchange for all of the Registered Global
Security or Securities representing such Debt Securities.
SENIOR DEBT
The Debt Securities and any coupons appertaining thereto (the "Coupons")
that will constitute part of the senior debt of the Company will be issued under
the Senior Debt Indenture and will rank equally and pari passu with all other
unsecured and unsubordinated debt of the Company.
SUBORDINATED DEBT
The Debt Securities and Coupons that will constitute part of the
subordinated debt of the Company will be issued under the Subordinated Debt
Indenture and will be subordinate and junior in right of payment, to the extent
and in the manner set forth in the Subordinated Debt Indenture, to all "Senior
Indebtedness" of the Company. The Subordinated Debt Indenture defines "Senior
Indebtedness" as obligations (other than nonrecourse obligations, the
subordinated Debt Securities or any other obligations specifically designated as
being subordinate in right of payment to Senior Indebtedness) of, or guaranteed
or assumed by, the Company for borrowed money or evidenced by bonds, debentures,
notes or other similar instruments, and amendments, renewals, extensions,
modifications and refundings of any such indebtedness or obligation.
(Subordinated Debt Indenture, Section 1.1)
In general, 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 (b) that (i) a
default shall have occurred with respect to the payment of principal, premium,
if any, or interest on or other monetary amounts due and payable on any Senior
Indebtedness or (ii) there shall have occurred an event of default (other than a
default in the payment of principal, premium, if any, or interest, or other
monetary amounts due and payable) with respect to 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 event of default shall have
continued beyond the period of grace, if any, in respect thereof, and such event
of default shall not have been cured or waived or shall not have ceased to
exist, or (c) that the principal of and accrued interest on any series of the
subordinated Debt Securities shall have been declared due and payable upon an
event of default pursuant to Section 5.1 of the Subordinated Debt Indenture and
such declaration shall not have been rescinded and annulled as provided therein,
then the holders of all Senior Indebtedness shall first be entitled to receive
payment of the full amount unpaid thereon, or provision shall be made for such
payment in money or money's worth, before the Holders of any of the subordinated
Debt Securities or Coupons are entitled to receive a payment on account of the
principal or interest on the indebtedness evidenced by such subordinated Debt
Securities (Subordinated Debt Indenture, Section 13.1) If this Prospectus is
being delivered in connection with a series of subordinated Debt Securities, the
accompanying Prospectus Supplement or the information incorporated herein by
reference will set forth the approximate amount of Senior Indebtedness
outstanding as of the end of the most recent fiscal quarter.
CERTAIN COVENANTS OF THE COMPANY
Liens. The Senior Debt Indenture provides that, subject to certain
exceptions, the Company will not, nor will it permit any Subsidiary to, issue,
assume or guarantee any Indebtedness secured by a mortgage, pledge, lien,
security interest or encumbrance ("mortgage"), upon any of its properties
without effectively providing that the senior Debt Securities issued thereunder
shall be equally and ratably secured with such Indebtedness. Among the
exceptions are certain purchase money mortgages; certain preexisting mortgages
on any property acquired or constructed by the Company or a Subsidiary and
certain mortgages created within one year after completion of such acquisition
or construction; certain mortgages created on any contract for the sale of
products or services related to the operation or use of any property acquired or
constructed within one year after completion of such acquisition or
construction; mortgages on property of a Subsidiary existing at the time it
became a Subsidiary of the Company; and mortgages, other than as specifically
excepted, in an aggregate
8
<PAGE> 10
amount which, at the time of, and after giving effect to, the incurrence does
not exceed 5 percent of the Consolidated Net Tangible Assets. (Senior Debt
Indenture, Section 3.6)
Consolidation, Merger, Conveyance of Assets. Each Indenture provides, in
general, that the Company will not consolidate with or merge into any other
corporation or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, unless the corporation formed by such
consolidation or into which the Company is merged or the Person which acquires
such assets shall expressly assume the Company's obligations under such
Indenture and the Debt Securities issued thereunder and immediately after giving
effect to 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
happened and be continuing. (Section 9.1)
EVENTS OF DEFAULT
In general, an Event of Default is defined under each Indenture with
respect to Debt Securities of any series issued under such Indenture as being:
(a) default in payment of any principal of the Debt Securities of such series,
either at maturity, upon any redemption, by declaration or otherwise; (b)
default for 30 days in payment of any interest on any Debt Securities of such
series unless otherwise provided; (c) default for 90 days after written notice
in the observance or performance of any covenant or warranty in the Debt
Securities of such series or such Indenture other than a covenant a default in
whose performance, or whose breach, is dealt with otherwise below or, if certain
conditions are met, the Events of Default described in this clause (c) are the
result of changes in generally accepted accounting principles; or (d) certain
events of bankruptcy, insolvency or reorganization of the Company. (Section 5.1)
In general, each Indenture provides that, (a) if an Event of Default
described in clauses (a), (b) or (c) above (if the Event of Default under clause
(c) is with respect to less than all series of Debt Securities then outstanding)
occurs, the Trustee or the Holders of not less than 25 percent in principal
amount of the Debt Securities of each affected series (treated as one class)
issued under such Indenture and then outstanding may then declare the entire
principal of all Debt Securities of each such affected series and interest
accrued thereon to be due and payable immediately and (b) if an Event of Default
due to a default described in clause (c) above which is applicable to all series
of Debt Securities then outstanding or due to certain events of bankruptcy,
insolvency and reorganization of the Company, shall have occurred and be
continuing, the Trustee or the Holders of not less than 25 percent in principal
amount of all Debt Securities issued under such Indenture and then outstanding
(treated as one class) may declare the entire principal of all such Debt
Securities and interest accrued thereon to be due and payable immediately, but
upon certain conditions such declarations may be annulled and past defaults may
be waived (except a continuing default in payment of principal of, premium, if
any, or interest on such Debt Securities) by the holders of a majority in
aggregate principal amount of the Debt Securities of all such affected series
then outstanding. (Sections 5.1 and 5.10)
Each Indenture contains a provision entitling the Trustee, subject to the
duty of the Trustee during a default to act with the required standard of care,
to be indemnified by the Holders of Debt Securities (treated as one class)
issued under such Indenture before proceeding, at the request of such Holders,
to exercise any right or power under such Indenture. (Section 6.2) Subject to
such provisions in each Indenture for the indemnification of the Trustee and
certain other limitations, the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of each series affected (treated as
one class) issued under such Indenture may 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. (Section 5.9)
In general, each Indenture provides that no Holder of Debt Securities
issued under such Indenture may institute any action against the Company under
such Indenture (except actions for payment of principal or interest on or after
the due date provided) unless such Holder previously shall have given to the
Trustee written notice of default and continuance thereof and unless the Holders
of not less than 25 percent in principal amount of the Debt Securities of each
affected series (treated as one class) issued under such Indenture and then
outstanding shall have requested the Trustee to institute such action and shall
have offered the Trustee reasonable indemnity and the Trustee shall not have
instituted such action within 60 days of such
9
<PAGE> 11
request and the Trustee shall not have received direction inconsistent with such
written request by the Holders of a majority in principal amount of the Debt
Securities of each affected series (treated as one class) issued under such
Indenture and then outstanding. (Sections 5.6, 5.7 and 5.9)
Each Indenture contains a covenant that the Company will file annually with
the Trustee a certificate of no default or a certificate specifying any default
that exists. (Section 3.5)
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Company can discharge or defease its obligations under each Indenture
as set forth below. (Section 10.1)
Under terms satisfactory to the Trustee, the Company may discharge certain
obligations to Holders of any series of Debt Securities issued under such
Indenture which have not already been delivered to the Trustee for cancellation
and which have either become due and payable or are by their terms due and
payable within one year (or scheduled for redemption within one year) by
irrevocably depositing with the Trustee cash or, in the case of Debt Securities
payable only in U.S. dollars, U.S. Government Obligations (as defined in such
Indenture) as trust funds in an amount certified to be sufficient to pay at
maturity (or upon redemption) the principal of and interest on such Debt
Securities.
The Company may also, upon satisfaction of the conditions listed below,
discharge certain obligations to Holders of any series of Debt Securities issued
under such Indenture at any time ("defeasance"). Under terms satisfactory to the
Trustee, the Company may instead be released with respect to any outstanding
series of Debt Securities issued under the relevant Indenture from the
obligations imposed by Sections 3.6 and 9.1, in the case of the Senior Debt
Indenture, and Section 9.1, in the case of the Subordinated Debt Indenture
(which contain the covenants described above limiting liens and consolidations,
mergers and conveyances of assets), and omit to comply with such Sections
without creating an Event of Default ("covenant defeasance"). Defeasance or
covenant defeasance may be effected only if, among other things: (i) the Company
irrevocably deposits with the Trustee cash or, in the case of Debt Securities
payable only in U.S. dollars, U.S. Government Obligations, as trust funds in an
amount certified to be sufficient to pay at maturity (or upon redemption) the
principal of and interest on all outstanding Debt Securities of such series
issued under such Indenture; (ii) the Company delivers to the Trustee an opinion
of counsel to the effect that the Holders of such series of Debt Securities will
not recognize income, gain or loss for United States federal income tax purposes
as a result of such defeasance or covenant defeasance and will be subject to
United States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if defeasance or covenant defeasance
had not occurred (in the case of a defeasance, such opinion must be based on a
ruling of the Internal Revenue Service or a change in United States federal
income tax law occurring after the date of such Indenture, since such a result
would not occur under current tax law); and (iii) in the case of the
Subordinated Debt Indenture (a) no event or condition shall exist that, pursuant
to certain provisions described under "Subordinated Debt" above, would prevent
the Company from making payments of principal of or interest on the subordinated
Debt Securities at the date of the irrevocable deposit referred to above or at
any time during the period ending on the 91st day after such deposit date and
(b) the Company delivers to the Trustee for the Subordinated Debt Indenture an
opinion of counsel to the effect that (1) the trust funds will not be subject to
any rights of holders of Senior Indebtedness and (2) after the 91st day
following the deposit, the trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally, except that, if a court were to rule under any such
law in any case or proceeding that the trust funds remained property of the
Company, then no opinion is given as to the effect of such laws on the trust
funds except as set forth in the Subordinated Indenture relating to (i)
Trustee's valid and perfected security interest in such trust funds; (ii)
adequate protection of holders of the Subordinated Debt Securities interests in
such trust funds; and (iii) no prior rights of holders of Senior Debt Securities
in property or interests granted to the Trustee or holders of the Subordinated
Debt Securities in exchange for or with respect to such trust funds.
10
<PAGE> 12
MODIFICATION OF THE INDENTURES
Each Indenture provides that the Company and the Trustee may enter into
supplemental indentures (which conform to the provisions of the Trust Indenture
Act of 1939) without the consent of the Holders to, in general: (a) secure any
Debt Securities; (b) evidence the assumption by a successor Person of the
obligations of the Company; (c) add further covenants for the protection of the
Holders; (d) cure any ambiguity or correct any inconsistency in such Indenture,
so long as such action will not adversely affect the interests of the Holders;
(e) establish the form or terms of Debt Securities of any series; and (f)
evidence the acceptance of appointment by a successor trustee. (Section 8.1)
Each Indenture also contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than the majority in
principal amount of Debt Securities of each series issued under such Indenture
then outstanding and affected (voting as one class) to, in general, add any
provisions to, or change in any manner or eliminate any of the provisions of,
such Indenture or modify in any manner the rights of the Holders of the Debt
Securities of each series so affected; provided that such changes conform to
provisions of the Trust Indenture Act of 1939 and provided that the Company and
the Trustee may not, without the consent of each Holder of outstanding Debt
Securities affected thereby, (a) extend the final maturity of the principal of
any Debt Securities, or reduce the principal amount thereof or reduce the rate
or extend the time of payment of interest thereon, or reduce any amount payable
on redemption thereof or change the currency in which the principal thereof
(including any amount in respect of original issue discount) or interest thereon
is payable, or reduce the amount of any original issue discount security payable
upon acceleration or provable in bankruptcy or alter certain provisions of such
Indenture relating to Debt Securities not denominated in U.S. dollars or for
which conversion to another currency is required to satisfy the judgment of any
court, or impair the right to institute suit for the enforcement of any payment
on any Debt Securities when due or (b) reduce the aforesaid percentage in
principal amount of Debt Securities of any series issued under such Indenture,
the consent of the Holders of which is required for any such modification.
(Section 8.2)
The Subordinated Debt Indenture may not be amended to alter the
subordination of any outstanding subordinated Debt Securities without the
consent of each Holder of Senior Indebtedness then outstanding that would be
adversely affected thereby. (Subordinated Debt Indenture, Section 8.6)
CONCERNING THE TRUSTEE
The Trustee is one of a number of banks with which the Company, its parent
and its Subsidiaries maintain ordinary banking relationships and with which the
Company and its Subsidiaries and Affiliates maintain credit facilities.
LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES
Except as may otherwise be provided in the Prospectus Supplement applicable
thereto, in compliance with United States federal income tax laws and
regulations, Debt Securities that are Bearer Debt Securities (including Debt
Securities in global form) will not be offered, sold, resold or delivered,
directly or indirectly, in connection with their original issuance, at any time,
in the United States or to United States persons (as defined below) other than
to offices located outside the United States of United States financial
institutions (as defined in United States Treasury Regulations Section
1.165-12(c)(1)(v)) that are purchasing for their own account or for the account
of a customer and that agree in writing to comply with the requirements of
Sections 165(j)(3)(A), (B) or (C) of the Internal Revenue Code and the
regulations thereunder. Any underwriters, agents and dealers participating in
the offerings of Bearer Debt Securities, directly or indirectly, must agree that
they will not, in connection with the original issuance of any Bearer Debt
Securities or during the period set forth in the Prospectus Supplement following
the original issuance of such Bearer Debt Securities offer, sell, resell or
deliver, directly or indirectly, any Bearer Debt Securities in the United States
or to United States persons (other than the financial institutions described
above). In addition, any such underwriters, agents and dealers must agree to
send a written confirmation to each purchaser from or through it of Bearer Debt
Securities in connection with their original issuance or during the period set
forth in the Prospectus Supplement following the original issuance of such
Bearer Debt Securities in every case confirming
11
<PAGE> 13
that such purchaser represents that it is not a United States person or, if it
is a United States person, that it is a financial institution described above
purchasing for its own account or the account of a customer and, if such person
is a dealer, that it will send similar confirmations to purchasers from it.
Bearer Debt Securities (other than temporary global Debt Securities) and
any Coupons appertaining thereto will bear a legend substantially to the
following effect: "Any United States person who holds this obligation will be
subject to limitations under the United States federal income tax laws,
including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code." The sections referred to in such legend provide that a
United States person (other than a United States financial institution described
above or United States person holding through such a financial institution) who
holds a Bearer Debt Security or Coupon will not be allowed to deduct any loss
realized on the sale, exchange or redemption of such Bearer Debt Security and
any gain (which might otherwise be characterized as capital gain) recognized on
such sale, exchange or redemption will be treated as ordinary income.
As used herein, "United States person" means a citizen, national or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States or any political
subdivision thereof, or an estate or trust the income of which is subject to
United States federal income taxation regardless of its source.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities in the following ways: (i) through
agents; (ii) through underwriters; (iii) through dealers; and (iv) directly to
purchasers.
Offers to purchase the Debt Securities may be solicited by agents
designated by the Company from time to time. Any such agent, who may be deemed
to be an underwriter as that term is defined in the Securities Act, involved in
the offer or sale of the Debt Securities in respect of which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent set forth, in the Prospectus Supplement. Unless otherwise indicated in the
Prospectus Supplement, any such agent will be acting on a best efforts basis for
the period of its appointment.
If any underwriters are utilized in the sale, the Company will enter into
an underwriting agreement with such underwriters at the time of sale to them and
the names of the underwriters and the terms of the transaction will be set forth
in the Prospectus Supplement, which will be used by the underwriters to make
resales to the public of the Debt Securities in respect of which this Prospectus
is delivered.
If a dealer is utilized in the sale of the Debt Securities in respect of
which this Prospectus is delivered, the Company will sell such Debt Securities
to the dealer, as principal. The dealer may then resell such Debt Securities to
the public at varying prices to be determined by such dealer at the time of
resale.
Agents, dealers and underwriters may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments which such agents, dealers or underwriters may be
required to make in respect thereof. Agents, dealers and underwriters may be
customers of, engage in transactions with, or perform services for the Company
in the ordinary course of business.
The Debt Securities may also be offered and sold, if so indicated in the
Prospectus Supplement, in connection with a remarketing upon their purchase, in
accordance with a redemption or repayment pursuant to their terms, or otherwise,
by one or more firms ("remarketing firms"), acting as principals for their own
accounts or as agents for the Company. Any remarketing firm will be identified
and the terms of its agreement, if any, with the Company and its compensation
will be described in the Prospectus Supplement. Remarketing firms may be deemed
to be underwriters in connection with the Debt Securities remarketed thereby.
Remarketing firms may be entitled under agreements which may be entered into
with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, and may be
customers of, engage in transactions with or perform services for the Company in
the ordinary course of business.
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<PAGE> 14
If so indicated in the Prospectus Supplement, the Company will authorize
agents and underwriters or dealers to solicit offers by certain purchasers to
purchase the Debt Securities from the Company at the public offering price set
forth in the Prospectus Supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the future. Such
contracts will be subject to only those conditions set forth in the Prospectus
Supplement, and the Prospectus Supplement will set forth the commission payable
for solicitation of such offers.
EXPERTS
The audited consolidated financial statements of the Company and its
subsidiaries appearing in the Company's Form 10 have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference. Such consolidated financial
statements are incorporated herein by reference in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.
The financial statements of Transco Energy Company-Contributed Assets
appearing in the Company's Form 10 filed on October 18, 1995, and incorporated
by reference in the prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said report.
The consolidated financial statements and schedules of the Company included
in or incorporated by reference in any documents filed pursuant to Section 13,
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to
the termination of the offering will be so included or incorporated by reference
in reliance upon the reports of independent auditors pertaining to such
financial statements (to the extent covered by consents filed with the
Securities and Exchange Commission) given upon the authority of such independent
auditors as experts in accounting and auditing.
LEGAL MATTERS
Certain legal matters in connection with the Debt Securities offered hereby
will be passed upon for the Company by J. Furman Lewis, Senior Vice President
and General Counsel of Williams, and for the Underwriters by Skadden, Arps,
Slate, Meagher & Flom, New York, New York. Mr. Lewis beneficially owns
approximately 15,530 shares of Williams' Common Stock and also has exercisable
options to purchase an additional 48,688 shares of Williams' Common Stock.
Pursuant to their By-laws, the Company and Williams are required to indemnify
Mr. Lewis to the fullest extent permitted by Delaware law against any expenses
actually and reasonably incurred by him in connection with any action, suit or
proceeding in which he is made party by reason of his being an officer of the
Company. The Company, through Williams, also maintains directors' and officers'
liability insurance under which Mr. Lewis is insured against certain expenses
and liabilities.
13
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Set forth below is an estimate of the approximate amount of the fees and
expenses payable by the Company in connection with the offering described in
this Registration Statement:
<TABLE>
<CAPTION>
APPROXIMATE
AMOUNT
-----------
<S> <C>
Securities and Exchange Commission registration fee...................... $ 137,932
Printing and engraving expenses.......................................... 50,000
Accounting fees and expenses............................................. 50,000
Blue Sky fees and expenses (including legal fees)........................ 15,000
Legal fees and expenses.................................................. 30,000
Trustees' fees........................................................... 20,000
Fees of rating agencies.................................................. 100,000
Miscellaneous expenses................................................... 27,068
--------
TOTAL.......................................................... $ 430,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
The Company, a Delaware corporation, is empowered by Section 145 of the
General Corporation Law of the State of Delaware, subject to the procedures and
limitations stated therein, to indemnify any person against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by them in connection with any threatened, pending or
completed action, suit or proceeding in which such person is made party by
reason of their being or having been a director, officer, employee or agent of
the Company. The statute provides that indemnification pursuant to its
provisions is not exclusive of other rights of indemnification to which a person
may be entitled under any by-law, agreement, vote of stockholders or
disinterested directors, or otherwise. The By-laws of the Company provide for
indemnification by the Company of its directors and officers to the fullest
extent permitted by the General Corporation Law of the State of Delaware. In
addition, Williams has entered into indemnity agreements with its directors and
certain officers providing for, among other things, the indemnification of and
the advancing of expenses to such individuals to the fullest extent permitted by
law, and to the extent insurance is maintained, for the continued coverage of
such individuals.
Policies of insurance are maintained by Williams under which the directors
and officers of the Company are insured, within the limits and subject to the
limitations of the policies, against certain expenses in connection with the
defense of actions, suits or proceedings, and certain liabilities which might be
imposed as a result of such actions, suits or proceedings, to which they are
parties by reason of being or having been such directors or officers.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------
<C> <S>
1.1 -- Form of Underwriting Agreement.
1.2 -- Form of Distribution Agreement.
*4.1 -- Form of Senior Debt Indenture (filed as Exhibit 4.1 to Registration
Statement on Form 10 dated October 18, 1995).
*4.2 -- Form of Subordinated Debt Indenture (filed as Exhibit 4.2 to
Registration Statement on Form 10 dated October 18, 1995).
</TABLE>
II-1
<PAGE> 16
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- -------------------- ------------------------------------------------------------------------
<C> <S>
*4.3 -- Form of Floating Rate Senior Note (filed as Exhibit 4.3 to
Registration Statement on Form 10 dated October 18, 1995).
*4.4 -- Form of Fixed Rate Senior Note (filed as Exhibit 4.4 to Registration
Statement on Form 10 dated October 18, 1995).
*4.5 -- Form of Floating Rate Subordinated Note (filed as Exhibit 4.5 to
Registration Statement on Form 10 dated October 18, 1995).
*4.6 -- Form of Fixed Rate Subordinated Note (filed as Exhibit 4.6 to
Registration Statement on Form 10 dated October 18, 1995).
*4.7 -- Certificate of Incorporation of the Company (filed as Exhibit 3(i) to
Registration Statement on Form 10 dated October 18, 1995).
*4.8 -- By-laws of the Company (filed as Exhibit 3(ii) to Registration
Statement on Form 10 dated October 18, 1995).
*4.9 -- U.S. $800,000,000 Credit Agreement, dated as of February 23, 1995,
among the Company and certain of its subsidiaries, and the lenders
named therein and Citibank, N.A., as agent (filed as Exhibit 4(d) to
Williams Form 10-K for the year ended December 31, 1994).
*4.10 -- First Amendment, dated as of June 15, 1995, to Exhibit 4.11 above
(filed as Exhibit 4.9 to the Northwest Pipeline Corporation
Registration Statement on Form S-3 No. 33-62639, filed September 14,
1995).
5 -- Opinion and consent of counsel of the Company, relating to the
validity of the Debt Securities.
*12 -- Computation of Ratio of Earnings to Fixed Charges (filed as Exhibit
12 to Registration Statement on Form 10 dated October 18, 1995).
23.1 -- Consent of Ernst & Young LLP.
23.2 -- Consent of Arthur Andersen LLP.
23.3 -- Consent of counsel (contained in Exhibit 5).
24.1 -- Power of Attorney.
24.2 -- Certified copy of resolution authorizing signatures pursuant to power
of attorney.
25 -- Statement of Eligibility and Qualification on Form T-1 for Senior
Debt Indenture and Subordinated Debt Indenture.
</TABLE>
- ---------------
* Such exhibit has heretofore been filed with the Securities and Exchange
Commission as part of the filing indicated and is incorporated herein by
reference.
ITEM 17. UNDERTAKINGS.
The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) of 15(d) of the Exchange Act that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
II-2
<PAGE> 17
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereto) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) (sec.230,424(b) of this
chapter) if, in the aggregate, the changes in volume and price represent
no more than a 20 percent change in the maximum aggregate offering price
set forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that paragraphs (i) and (ii) above 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 Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at 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.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has 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 a claim for indemnification against
such liabilities (other than the payment by the Company of expenses incurred or
paid by a director, officer or controlling person of the Company in a successful
defense of any action, suit or proceeding) is asserted against the Company by
such director, officer or controlling person in connection with the securities
being registered, the Company will, unless in the opinion of its 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-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
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 Tulsa and State of Oklahoma on the 18th day of
October, 1995.
WILLIAMS HOLDINGS OF DELAWARE, INC.
(Registrant)
By /s/ DAVID M. HIGBEE
David M. Higbee
Attorney-in-Fact
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 date indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- -------------------------------------------------
<C> <S> <C>
/s/ Chairman of the Board &
Keith E. Bailey* President (principal
executive officer)
/s/ Senior Vice President,
Jack D. McCarthy* Treasurer & Assistant
Secretary (principal
financial officer)
/s/ Controller (principal
Gary R. Belitz* accounting officer)
/s/ Director
John C. Bumgarner, Jr.*
/s/ Director October 18, 1995
Stephen L. Cropper*
/s/ Director
Lloyd A. Hightower*
/s/ Director
Henry C. Hirsch*
/s/ Director
Howard E. Janzen*
*By /s/ DAVID M. HIGBEE
David M. Higbee
Attorney-in-Fact
</TABLE>
II-4
<PAGE> 19
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ---------- ------------------------------------------------------------------------
<C> <S> <C>
1.1 -- Form of Underwriting Agreement.
1.2 -- Form of Distribution Agreement.
*4.1 -- Form of Senior Debt Indenture (filed as Exhibit 4.1 to Registration
Statement on Form 10 dated October 18, 1995).
*4.2 -- Form of Subordinated Debt Indenture (filed as Exhibit 4.2 to
Registration Statement on Form 10 dated October 18, 1995).
*4.3 -- Form of Floating Rate Senior Note (filed as Exhibit 4.3 to
Registration Statement on Form 10 dated October 18, 1995).
*4.4 -- Form of Fixed Rate Senior Note (filed as Exhibit 4.4 to Registration
Statement on Form 10 dated October 18, 1995).
*4.5 -- Form of Floating Rate Subordinated Note (filed as Exhibit 4.5 to
Registration Statement on Form 10 dated October 18, 1995).
*4.6 -- Form of Fixed Rate Subordinated Note (filed as Exhibit 4.6 to
Registration Statement on Form 10 dated October 18, 1995).
*4.7 -- Certificate of Incorporation of the Company (filed as Exhibit 3(i) to
Registration Statement on Form 10 dated October 18, 1995).
*4.8 -- By-laws of the Company (filed as Exhibit 3(ii) to Registration
Statement on Form 10 dated October 18, 1995).
*4.9 -- U.S. $800,000,000 Credit Agreement, dated as of February 23, 1995,
among the Company and certain of its subsidiaries, and the lenders
named therein and Citibank, N.A., as agent (filed as Exhibit 4(d) to
Williams Form 10-K for the year ended December 31, 1994).
*4.10 -- First Amendment, dated as of June 15, 1995, to Exhibit 4.11 above
(filed as Exhibit 4.9 to the Northwest Pipeline Corporation
Registration Statement on Form S-3 No. 33-62639, filed September 14,
1995).
5 -- Opinion and consent of counsel of the Company, relating to the
validity of the Debt Securities.
*12 -- Computation of Ratio of Earnings to Fixed Charges (filed as Exhibit
12 to Registration Statement on Form 10 dated October 18, 1995).
23.1 -- Consent of Ernst & Young LLP.
23.2 -- Consent of Arthur Andersen LLP.
23.3 -- Consent of counsel (contained in Exhibit 5).
24.1 -- Power of Attorney.
24.2 -- Certified copy of resolution authorizing signatures pursuant to power
of attorney.
25 -- Statement of Eligibility and Qualification on Form T-1 for Senior
Debt Indenture and Subordinated Debt Indenture.
</TABLE>
- ---------------
* Such exhibit has heretofore been filed with the Securities and Exchange
Commission as part of the filing indicated and is incorporated herein by
reference.
II-5
<PAGE> 1
EXHIBIT 1.1
WILLIAMS HOLDINGS OF DELAWARE, INC.
(a Delaware corporation)
UNDERWRITING AGREEMENT
_________________________
______________, 199__
<PAGE> 2
UNDERWRITING AGREEMENT
_____________, 199___
Williams Holdings of Delaware, Inc.
One Williams Center
Tulsa, Oklahoma 74172
Dear Sirs:
We (the "Manager") are acting on behalf of the underwriter
or underwriters (including ourselves) named below (such underwriter or
underwriters being herein called the Underwriters"), and we understand that
Williams Holdings of Delaware, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell [indicate currency and amount] aggregate principal
amount of [full title of debt securities] (the "Securities").
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 Securities] set forth below opposite their names at a
purchase price of [_____%] of the principal amount of such Securities, plus
accrued interest from [Date of Securities] to the date of payment and delivery:
<TABLE>
<CAPTION>
Principal
Amount of
Name Securities
----------
<S> <C> <C>
[Insert syndicate list] $
Total . . . . . . . . . . . . . . $
=========
</TABLE>
<PAGE> 3
[The aggregate principal amount of Securities to be
purchased by the several Underwriters may be reduced by the aggregate principal
amount of Securities sold pursuant to delayed delivery contracts.]*
The Underwriters will pay for such Securities (less any
Securities sold pursuant to delayed delivery contracts) upon delivery thereof
at the offices of _________________ at 10:00 a.m. (New York time) on
___________, 199__, or at such other time, not later than ____ (New York time)
on _________, 199__, as shall be jointly designated by the Manager and the
Company.
The Securities shall have the terms set forth in the
Prospectus dated ___________, 199__, and the Prospectus Supplement dated
____________, 199__, including the following:
[Terms of Securities
Maturity: __________ ___, 19__
Interest Rate: ___% per annum
Redemption Provisions:
Interest Payment Dates: _________ ___, and _______ ___
commencing ______ ___, 19__
(Interest accrues from
__________ ___, 19__)
Form and Denomination:
[Other terms:]]
[The fee to be paid to the Underwriters in respect of the
Securities purchased pursuant to delayed delivery contracts arranged by the
Underwriters shall be ___% of the purchase price of the Securities so
purchased] *
All provisions contained in the document entitled Williams
Holdings of Delaware, Inc. Underwriting Agreement Standard Provisions (Debt)
dated ________, 199__, a copy of which we have previously received, are herein
incorporated by reference in their entirety and shall be deemed to be a part of
this agreement to the same extent as if such provisions had been set forth in
full herein.
__________
* To be added only if delayed delivery contracts are contemplated.
-2-
<PAGE> 4
Please confirm your agreement by having an authorized
officer sign a copy of this agreement in the space set forth below and
returning the signed copy to us.
Very truly yours,
[MANAGER]
By [MANAGER]
By __________________________
Acting severally on behalf of
itself and the other several
Underwriters named above
Accepted:
WILLIAMS HOLDINGS OF DELAWARE, INC.
By _________________________
Title:
-3-
<PAGE> 5
WILLIAMS HOLDINGS OF DELAWARE, INC.
UNDERWRITING AGREEMENT
STANDARD PROVISIONS (DEBT)
From time to time, Williams Holdings of Delaware, Inc., a
Delaware corporation (the "Company"), may enter into one or more underwriting
agreements that provide for the sale of designated securities to the several
Underwriters named therein. The standard provisions set forth herein may be
incorporated by reference in any such underwriting agreement (an "Underwriting
Agreement"). The Underwriting Agreement, including the provisions incorporated
therein by reference, is herein referred to as this Agreement. Unless
otherwise defined herein, terms defined in the Underwriting Agreement are used
herein as therein defined.
The Company proposes to issue from time to time debt
securities to be issued pursuant to the provisions of a senior debt indenture
dated as of ___________, 199__ (as it may be supplemented or amended from time
to time, the "Senior Debt Indenture") between the Company and Citibank, N.A.,
as Senior Debt Trustee and a subordinated debt indenture dated as of
___________, 199__ (as it may be supplemented or amended from time to time, the
"Subordinated Debt Indenture") between the Company and Citibank, N.A., as
Subordinated Debt Trustee.
The debt securities will have varying designations,
maturities, rates and times of payment of interest, selling prices, redemption
terms and other terms. Any such debt securities are herein sometimes
collectively referred to as the "Securities".
The Company has filed with the Securities and Exchange
Commission (the "Commission"), in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(herein referred to collectively as the "Act"), a registration statement
including a prospectus relating to the Securities [and has filed with, or
mailed for filing to, the Commission a prospectus supplement or supplements
specifically relating to the Securities pursuant to Rule 424 under the Act].
The term Registration Statement means the registration statement as amended to
the date of the Underwriting Agreement. The term Basic Prospectus means the
prospectus included in the Registration Statement. The term Prospectus means
the Basic Prospectus together with the prospectus supplement or abbreviated
term sheet (other than a preliminary prospectus supplement or preliminary
abbreviated term sheet) specifically relating to the Securities. The term
preliminary prospectus means a preliminary prospectus supplement or preliminary
abbreviated term sheet specifically relating to the Securities, together with
the Basic Prospectus. As used herein, the terms "Registration Statement",
"Basic Prospectus", "Prospectus" and "preliminary prospectus" shall include, in
each case, the material, if any, incorporated by reference therein.
The term Contract Securities means the Securities, if
<PAGE> 6
any, to be purchased pursuant to the delayed delivery contracts substantially
in the form of Schedule I hereto, with such changes therein as the Company may
authorize or approve (the "Delayed Delivery Contracts"). The term
"Underwriters' Securities" means the Securities other than Contract Securities.
The Company and the Underwriters agree as follows:
1. Sale and Purchase. If the Prospectus provides for
sales of Securities pursuant to Delayed Delivery Contracts, the Company hereby
authorizes the Underwriters to solicit offers to purchase Contract Securities
on the terms contained in the Delayed Delivery Contracts. Delayed Delivery
Contracts are to be with institutional investors approved by the Company and of
the types set forth in the Prospectus. On the Closing Date (as hereinafter
defined), the Company will pay the Manager, as compensation for the accounts of
the Underwriters, the commissions set forth in the Underwriting Agreement in
respect of the Contract Securities. The Underwriters will not have any
responsibility in respect of the validity or the performance of Delayed
Delivery Contracts.
If the Company executes and delivers Delayed Delivery
Contracts with institutional investors, the Securities comprising the Contract
Securities shall be deducted from the Securities to be purchased by the several
Underwriters, and the aggregate principal amount of Securities to be purchased
by each Underwriter shall be reduced pro rata in proportion to the principal
amount of Securities set forth opposite each Underwriter's name in the
Underwriting Agreement, except to the extent that the Manager determines that
such reduction shall be otherwise and so advises the Company.
The Company is advised by the Manager that the Underwriters
propose to make a public offering of their respective portions of the
Underwriters' Securities as soon after this Agreement is entered into as in the
Manager's judgment is advisable. The terms of the public offering of the
Underwriters' Securities are set forth in the Prospectus.
2. Payment and Delivery. Payment for the
Underwriters' Securities shall be made by certified or official bank check
payable to the order of the Company in New York Clearing House funds at the
time and place set forth in the Underwriting Agreement, upon delivery to the
Manager for the respective accounts of the several Underwriters of the
Underwriters' 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. The time and date of such payment and delivery
with respect to the Underwriters' Securities are herein referred to as the
Closing Date.
3. Certain Covenants of the Company. In further
consideration of the agreements of the Underwriters herein contained, the
Company covenants as follows:
-2-
<PAGE> 7
(a) To furnish you, without charge, three signed copies
of the Registration Statement (including exhibits thereto and
documents incorporated therein by reference) and, during the period
mentioned in paragraph (c) below, as many copies of the Prospectus,
any documents incorporated therein by reference, and any supplements
and amendments thereto as you may reasonably request. The terms
"supplement" and "amendment" or "amend" as used in this Agreement
shall include all documents subsequently filed by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), that are deemed to be incorporated by reference
in the Prospectus, including any abbreviated term sheets.
(b) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish you a copy of each such
proposed amendment or supplement and to file no such proposed
amendment or supplement to which you reasonably object in writing;
provided, that the foregoing shall not apply to amendments or
supplements that relate to securities registered under the
Registration Statement that are not Securities.
(c) If, at any time when a Prospectus relating to the
Securities is in the opinion of your counsel required by law to be
delivered under the Act, any event shall occur as a result of which it
is necessary to amend or supplement the Prospectus in order to make
the statements therein, in light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Prospectus to comply with law,
forthwith to prepare and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Securities may have been sold by you
on behalf of 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 light of the circumstances when the Prospectus is delivered to a
purchaser, be misleading or so that the Prospectus 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
you shall reasonably request and to pay all expenses (including fees
and disbursements of counsel) in connection therewith as well as all
fees, if any, payable in connection with the review of the offering of
the Securities by the National Association of Securities Dealers,
Inc. and the determination of the eligibility of the Securities for
investment under the laws of such jurisdictions as the Manager may
designate.
(e) To make generally available to the Company's
security holders as soon as practicable an earnings statement or
statements of the Company which shall satisfy
-3-
<PAGE> 8
the provisions of Section 11(a) of the Act.
(f) During the period beginning on the date of this
Agreement and continuing to and including the Closing Date, not to
offer, sell, contract to sell or otherwise dispose of any securities
of the Company substantially similar to the Securities other than the
Securities, without the prior written consent of the Manager.
4. Reimbursement of Underwriters' Expenses. 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 in any material respect, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement in any material respect, 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 the Securities.
5. Certain Covenants of the Underwriters.
Each of the several Underwriters agrees with the Company
that:
(a) it will not offer, sell, resell, or deliver,
directly or indirectly, any Securities in bearer form (including any
Security in global form that is exchangeable for Securities in bearer
form) within the United States of America, its territories and
possessions and other areas subject to its jurisdiction and the
Commonwealth of Puerto Rico (the "United States") in connection with
their original issuance or during the period set forth in the
Prospectus;
(b) it will not offer, sell, resell or deliver, directly
or indirectly, Securities in bearer form, in connection with their
original issuance or during such period, to a United States Person
(which term, as used herein, means any citizen, national or resident
of the United States, any corporation, partnership or other entity
created or organized in or under the laws of the United States or any
political subdivision thereof or any estate or trust the income of
which is subject to United States federal income taxation regardless
of its source) other than to an office located outside the United
States of a financial institution as defined in Section
1.165-12(c)(1)(v) of the Treasury Department Regulations, purchasing
for its own account or for the account of a customer and that provides
a written statement that it will comply with Section 165(j)(3)(A), (B)
or (C) of the Internal Revenue Code of 1986, as amended from time to
time, and the regulations thereunder, which financial institution, as
a condition of the purchase, agrees to provide on delivery of such
Securities (or on issuance of such Securities if not in
-4-
<PAGE> 9
definitive form) the certificate required in paragraph (c) below;
(c) it will deliver to each purchaser from it of any
Securities in bearer form (including Securities initially represented
by a temporary global certificate) a written confirmation stating
substantially the following:
"By your purchase of Securities in bearer form you represent
that you are not a United States Person or, if you are a United States Person,
that you are a financial institution as defined in Section 1.165-12(c)(1)(v) of
the Treasury Department Regulations, purchasing for your own account or for the
account of a customer and that you will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended from
time to time, and the regulations thereunder. Furthermore, if you are a
dealer, you agree that you will deliver a confirmation containing this entire
paragraph to purchasers of such Securities from you. For purposes of this
statement, 'United States Person' means any citizen, national or resident of
the United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States or any political
subdivision thereof or any estate or trust the income of which is subject to
United States federal income taxation regardless of its source, and 'United
States' means the United States of America, its territories and possessions and
other areas subject to its jurisdiction and the Commonwealth of Puerto Rico."
(d) it will deliver Securities in definitive bearer form
to the person entitled to delivery thereof (or transfer of interests
therein) only outside the United States and upon receipt of a written
confirmation stating substantially the following:
"This confirms as of the date hereof that none of the Securities
issued in bearer form delivered or credited to you for our account are being
acquired by or on behalf of, or for offer to resell or for resale to, a United
States Person, or any person inside the United States, or, if a beneficial
interest in such Securities issued in bearer form is being acquired by a United
States Person, that such person is a financial institution as defined in
Section 1.165- 12(c)(1)(v) of the Treasury Department Regulations, or is
acquiring such Securities through such a financial institution and that such
Securities are held by a financial institution that has agreed to comply with
Section 165 (j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as
amended from time to time, and the regulations thereunder, and is not
purchasing for offer to resell or for resale inside the United States. As used
herein, 'United States Person' means any citizen, national or resident of the
United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States or any political
subdivision thereof or any estate or trust the income of which is subject to
United States federal income taxation regardless of
-5-
<PAGE> 10
its source, and 'United States' means the United States of America, its
territories and possessions and other areas subject to its jurisdiction and the
Commonwealth of Puerto Rico.";
provided, however, that (i) if it has actual knowledge that the information
contained in any confirmation delivered pursuant to (c) or (d) above is false,
it shall not deliver any Securities in bearer form to, or, if applicable, cause
a transfer of an interest in any Global Security to the account of, the person
who signed or delivered the confirmation referred to in (d) above
notwithstanding the delivery of such confirmation to it, and (ii) when a
certificate is provided by a clearing organization, it must be based on
statements provided to it by its member organizations. As used herein, a
"clearing organization" is an entity that is in the business of holding
obligations for member organizations and transferring obligations among such
members by credit or debit to the account of a member without the necessity of
physical delivery of the obligation; and
(e) it will comply with or observe any other
restrictions or limitations set forth in the Prospectus on persons to
whom, or the jurisdictions in which, or the manner in which, the
Securities may be offered, sold, resold or delivered.
If Underwriters' Securities are to be distributed through a selling
group consisting of banks, brokers or dealers, the Manager agrees that it shall
cause each member of such selling group to enter into an agreement that it will
comply with this Section 5.
6. Conditions of Underwriters' Obligations. The
several obligations of the Underwriters to purchase and pay for any issue of
Underwriters' Securities hereunder are subject to the following conditions:
(a) That, at the Closing Date, the Company shall furnish
to the Manager an opinion of J. Furman Lewis, Esq., General Counsel of
the Company, dated the Closing Date, in substantially the form set
forth as Exhibit A.
(b) That, at the Closing Date, the Manager shall receive
an opinion of Skadden, Arps, Slate, Meagher & Flom, counsel for the
Underwriters, dated the Closing Date, in substantially the form set
forth as Exhibit B.
(c) That, at the Closing Date, the Company shall furnish
to the Manager a letter addressed to the Underwriters and dated the
Closing Date, in form and substance satisfactory to the Manager, from
Ernst & Young, 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 relating to the Company
contained in or incorporated by reference into the Registration
Statement and the
-6-
<PAGE> 11
Prospectus.
(d) That, at the Closing Date, the Company shall have
furnished to the Manager a certificate dated the Closing Date and
signed by an officer of the Company, to the effect set forth below.
The officer signing and delivering such certificate may rely upon the
best of his knowledge as to proceedings threatened.
(i) the representations and warranties of the
Company contained herein are true and correct in all
material respects as of the Closing Date;
(ii) no stop order suspending the effectiveness
of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or
threatened by the Commission;
(iii) subsequent to the execution and delivery of
this Agreement and prior to the Closing Date, there shall
not have occurred any downgrading, nor shall any notice have
been given of (A) any intended or potential downgrading or
(B) any review or possible change that does not indicate the
direction of a possible change, in the rating accorded any
of the Company's securities by any "nationally recognized
statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Act; and
(iv) there has not occurred any material adverse
change, or any development which could reasonably be
expected to result in a prospective material adverse change,
in the financial condition, or in the earnings, business or
operations, of the Company and its subsidiaries, taken as a
whole, from that set forth in the Registration Statement and
the Prospectus.
(e) That, the Company shall have performed in all
material respects such of its obligations under this Agreement as are
to be performed by the terms hereof at or before the time of purchase.
(f) That, the Company shall have accepted Delayed
Delivery Contracts, if any, in any case in which sales of Contract
Securities arranged by the Underwriters have been approved by the
Company.
7. Termination of Agreement. If the sale to the
Underwriters of the Underwriters' Securities, as contemplated in this
Agreement, is not carried out by the Underwriters for any reasons permitted
hereunder, or if such sale is not carried out because the Company shall be
unable to comply with any of the terms hereof, the Company shall not be under
any obligation or liability under this Agreement (except to the extent provided
in
-7-
<PAGE> 12
Sections 4 and 10 hereof), and the Underwriters shall be under no obligation or
liability to the Company under the agreement (except to the extent provided in
Section 10 hereof) or to one another hereunder.
If the Manager or any group of Underwriters elect to
terminate this Agreement as provided in this Section 7, the Company and each
other Underwriter shall be notified promptly by letter, telecopier or telegram.
8. Defaulting Underwriters. If any Underwriter or
Underwriters shall default in its or their obligation to take up and pay for
the Securities to be purchased by it or them hereunder, the non-defaulting
Underwriters shall take up and pay for (in addition to the principal amount of
Securities they are obligated to purchase hereunder) the principal amount of
Securities agreed to be purchased by all such defaulting Underwriters as
hereinafter set forth; provided, however, that in the event that the principal
amount of Securities which all Underwriters so defaulting shall have agreed but
failed to take up and pay for shall exceed 10% of the total principal amount of
Securities, the non-defaulting Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any of the Securities,
and if such non-defaulting Underwriters do not purchase all the Securities,
this Agreement will terminate without liability to any non-defaulting
Underwriter or the Company. If non-defaulting Underwriters take up and pay for
all Securities agreed to be purchased by all such defaulting Underwriters, such
Securities shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such amount or amounts as the Manager may designate with the
consent of each Underwriter so designated or, in the event no such designation
is made, such Securities shall be taken up and paid for by all non-defaulting
Underwriters pro rata in proportion to the aggregate principal amount of
Securities set opposite the names of such non-defaulting Underwriters herein.
Without relieving any defaulting Underwriter from its
obligations hereunder, the Company agrees with the non-defaulting Underwriters
that it will not sell any Securities hereunder unless all of the Underwriters'
Securities are purchased by the Underwriters (or by substituted underwriters
selected by the Manager with the approval of the Company or selected by the
Company with the Manager's approval).
If a new underwriter or underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provisions, the Company or the Manager shall have
the right to postpone the Closing Date for a period not exceeding five business
days in order that necessary changes in the Registration Statement and
Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer
to and include any underwriter substituted under this Section 8 with like
effect as if such substituted underwriter had
-8-
<PAGE> 13
originally been named herein.
9. Representations and Warranties. The Company
represents and warrants to each of the Underwriters that:
(a) each document filed or to be filed pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act") and incorporated
by reference in the Registration Statement and the Prospectus,
complied or will comply when so filed in all material respects with
the Exchange Act and the applicable rules and regulations thereunder;
(b) each part of the Registration Statement and the
Prospectus filed as part of the Registration Statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule
424 under the Act, complied when so filed in all material respects
with the Act;
(c) the Registration Statement and the Prospectus (as
amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) will comply in all material
respects with the Act and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of
circumstances under which the statements are made, not misleading;
(d) the representations and warranties set forth in this
Section 9 do not apply (1) to statements or omissions in the
Registration Statement or the Prospectus based upon information
furnished to the Company in writing by any Underwriter expressly for
use therein or (2) to that part of the Registration Statement that
constitutes a Statement of Eligibility and Qualification (Form T-1)
under the Trust Indenture Act of 1939, as amended, of the Trustee
referred to in the Registration Statement.
10. Indemnification and Contribution. (a) The Company
agrees to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of
either Section 15 of the Act, or Section 20 of the Exchange Act, from
and against any and all losses, claims, damages and liabilities caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any Basic Prospectus or any preliminary
prospectus, 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, in light of the circumstances under which
made, 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 furnished
to the Company in writing by any Underwriter expressly for use
therein.
-9-
<PAGE> 14
(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 Act, or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each 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, the Prospectus, any amendment or supplement
thereto, or any Basic Prospectus or any preliminary prospectus.
(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 of the two preceding
paragraphs, such person (hereinafter called the indemnified party)
shall promptly notify the person against whom such indemnity may be
sought (hereinafter called 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 reasonable 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 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 as shall be reasonable shall be reimbursed as they are
incurred. In the case of any such separate firm for the Underwriters
and such control persons of Underwriters, such firm shall be
designated in writing by the Manager. In the case of any such
separate firm for the Company, and such directors, officers and
control persons of the Company, such firm shall be designated in
writing by the Company. 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
-10-
<PAGE> 15
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the third sentence of this
paragraph, 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) If the indemnification provided for in paragraphs
(a) or (b) of this Section 10 is unavailable to an indemnified party
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 and the Underwriters 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 Company and of the Underwriters in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the
Company and the Underwriters shall be deemed to be in the same
respective proportions as the net proceeds from the offering (before
deducting expenses) received by the Company and the total underwriting
commissions received by the Underwriters, in each case as set forth in
the table on the cover of the Prospectus, bear to the aggregate public
offering price of the Securities. The relative fault of the Company
and the Underwriters 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.
(e) The Company and the Underwriters agree that it would
not be just and equitable if contribution pursuant to
-11-
<PAGE> 16
this Section 10 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 which does not take account of the
equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the
losses, claims, damages and liabilities referred to in paragraph (d)
above 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
10, 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 which 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 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresenta-tion. The Underwriters'
obligations to contribute pursuant to this Section 10 are several in
proportion to their respective underwriting percentages determined by
the ratio which the original purchase obligation of any Underwriter
appearing in the Underwriting Agreement (or such amount increased as
provided in Section 8 above) bears to the total purchase obligations
of the Underwriters set forth therein.
(f) The indemnity and contribution agreements contained in
this Section 10 and the representations and warranties of the Company
contained herein shall remain operative and in full force and effect
regardless of (1) any termination of this Agreement, (2) any
investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the Company, its
officers or directors or any other person controlling the Company and
(3) acceptance of and payment for any of the Securities.
11. Termination in Certain Events. This Agreement shall be
subject to termination in the Manager's absolute discretion, by notice given 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
Williams Companies, Inc. 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
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<PAGE> 17
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.
12. Counterparts. This Agreement may be signed by the
parties in counterparts which together shall constitute one and the same
agreement between the parties and shall become effective at such time as each
of the parties shall have signed such counterparts and shall have notified the
other party thereof.
13. Construction. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York.
14. Parties at Interest. This Agreement has been and is
made solely for the benefit of the Underwriters and the Company, and the
controlling persons, directors and officers referred to in Section 10 hereof,
and their respective successors, assigns, executors and administrators. No
other person shall acquire or have any right under or by virtue of this
Agreement.
15. Section Headings. The Section headings in this
Agreement have been inserted as a matter of convenience of reference and are
not a part of this Agreement.
-13-
<PAGE> 18
SCHEDULE I
DELAYED DELIVERY CONTRACT
Williams Holdings of Delaware, Inc.
One Williams Center
Tulsa, Oklahoma 74172
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from Williams
Holdings of Delaware, Inc., a Delaware corporation (the "Company"), and the
Company agrees to sell to the undersigned
$______________________________________________
principal amount of the Company's [title of issue] (the "Securities") offered
by the Company's Prospectus dated , 199__ and Prospectus Supplement or
abbreviated term sheet dated , 199__, receipt of copies of which are hereby
acknowledged, at a purchase price equal to ______% of the principal amount of
such Securities [plus accrued interest on the Securities from ,
199 , to the delivery date or dates thereof] [and accrued amortization of
original issue discount from _____________, 199__ to the date of payment and
delivery] and on the further terms and conditions set forth in this contract.
The undersigned does not contemplate selling Securities prior to making payment
therefor.
The undersigned will purchase from the Company the principal
amounts of Securities on the delivery dates (the "Delivery Dates") set forth
below:
<TABLE>
<CAPTION>
[Plus Accrued
Interest From] [and]
[Amortization of
[Principal Amount] Original Issue
Discount From]
<S> <C> <C>
__________________ $___________________ ____________________
__________________ $___________________ ____________________
__________________ $___________________ ____________________
</TABLE>
Payment for the Securities which the undersigned has
<PAGE> 19
agreed to purchase on each Delivery Date shall be made to the Company or its
order by certified or official bank check in New York Clearing House funds at
the office of __________________________, New York, New York (or at such other
place as the undersigned and the Company shall agree) at 10:00 A.M., New York
City time, on such Delivery Date, upon delivery to the undersigned of the
Securities to be purchased by the undersigned on such Delivery Date, in such
denominations and registered in such names as the undersigned may designate by
written or telegraphic communication addressed to the Company not less than
five full business days prior to such Delivery Date.
The obligation of the undersigned to take delivery of and
make payment for the Securities on each Delivery Date shall be subject to the
conditions that (1) the purchase of Securities to be made by the undersigned
shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which the undersigned is subject and (2) the Company shall have
sold and had delivered to the underwriters (the "Underwriters") named in the
Prospectus Supplement referred to above such part of the Securities as is to be
sold to them.
Promptly after completion of sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned at its
address set forth below notice to such effect, accompanied by copies of the
opinions of counsel for the Company delivered to the Underwriters in connection
therewith.
Failure to take delivery of and make payment for Securities
by any purchaser under any other Delayed Delivery Contract shall not relieve
the undersigned of its obligations under this contract.
The undersigned represents and warrants that, (a) as of the
date of this contract, the undersigned is not prohibited under the laws of the
jurisdictions to which the undersigned is subject from purchasing the
Securities hereby agreed to be purchased and (b) the undersigned does not
contemplate selling the Securities which it has agreed to purchase hereunder
prior to the Delivery Date therefor.
This contract will inure to the benefit of and be binding
upon the parties hereto and their respective successors, but will not be
assignable by either party hereto without the written consent of the other.
This contract shall be governed by and construed in accordance with the laws of
the State of New York. This contract may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
It is understood that the acceptance of any Delayed Delivery
Contract is in the Company's sole discretion and, without limiting the
foregoing, need not be on a first-come, first-served basis. If the contract is
acceptable to the Company, it is requested that the Company sign the form of
-2-
<PAGE> 20
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding
contract, as of the date first above written, between the Company and the
undersigned when such counterpart is so mailed or delivered.
Yours very truly,
_______________________________________
Purchaser
By: ___________________________________
_______________________________________
(Title)
_______________________________________
(Address)
Accepted, as of the date
first above written:
Williams Holdings of Delaware, Inc.
By: _______________________
-3-
<PAGE> 21
PURCHASER--PLEASE COMPLETE AT TIME OF SIGNING
The name, telephone number and department of the
representative of the Purchaser with whom details of delivery on the Delivery
Date may be discussed are as follows:
(Please print.)
Name (Including Area Code) Department
- ---- --------------------- ----------
-4-
<PAGE> 22
EXHIBIT A
FORM OF
OPINION OF
J. FURMAN LEWIS, ESQ.
GENERAL COUNSEL OF THE COMPANY
______________, 19______
[MANAGER]
as Manager for the several Underwriters
[ADDRESS] ________
__________________
__________________
Dear Sirs:
I have acted as counsel to Williams Holdings of Delaware,
Inc., a Delaware corporation (the "Company"), in connection with the
Underwriting Agreement dated _____________, 199__ (the "Underwriting
Agreement") between you and the Company, pursuant to which the Underwriters
severally agree to purchase from the Company an aggregate of [$] [symbol for
foreign currency or currency unit] __________ principal amount of the
debtsecurities of the Company (the "Securities") issued or to be issued
pursuant to a [senior] [subordinated] indenture dated as of ____________ ___,
199__ (the Indenture") between the Company and Citibank, N.A., as Trustee (the
"Trustee") to be issued pursuant to the Indenture. I, or persons responsible
to me, have examined originals or copies, certified or otherwise identified to
my satisfaction, and such documents, corporate records, certificates of public
officials and other instruments as I have deemed necessary or advisable for the
purpose of rendering this opinion. Defined terms herein unless otherwise
specified shall have the meaning specified in the Underwriting Agreement.
I have also examined copies of the Registration Statement on
Form S-3 (File No. 33- ) relating to up to $ aggregate principal amount of
securities filed with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended (the "Securities Act"), exhibits
thereto and documents incorporated by reference therein. Such Registration
Statement is now effective, and is herein called the "Registration Statement".
The prospectus constituting a part thereof, in the form filed with the
Commission pursuant to Rule 424 of the rules and regulations under the Act,
together with the [prospectus supplement] [abbreviated term sheet] (other than
a [preliminary prospectus supplement] [abbreviated term sheet]) specifically
relating to the Securities, as filed with,
<PAGE> 23
or mailed for filing to, the Commission pursuant to Rule 424, is herein called
the "Prospectus".
Based upon the foregoing, I am of the opinion that:
(1) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State of
Delaware and is duly qualified to do 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 upon the Company and its subsidiaries, taken as a whole.
(2) Each of [Williams Field Services Group, Inc., Williams
Pipe Line Company, Williams Energy Services Company, Williams Energy Ventures,
Inc., Williams Telecommunications Services, Inc., and Vyvx, Inc.] (the
"Material Subsidiaries") has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation 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.
(3) Each of the Company and the Material Subsidiaries has all
consents, authorizations, approvals, orders, certificates and permits of and
from, and has made all declarations and filings with, all federal, state, local
and other governmental authorities, and all courts or other tribunals,
necessary to conduct its business in the manner described in the Prospectus,
except to the extent that the lack of such consents, authorizations, approvals,
orders, certificates or permits would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(4) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming due authorization, execution and
authentication by the Trustee is a valid and binding agreement of the Company
enforceable in accordance with its terms subject, as to enforcement, to
bankruptcy, insolvency, reorganization, and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
The Indenture has been duly qualified under the Trust Indenture Act of 1939.
(5) The Securities have been duly authorized and, when
executed and authenticated in accordance with the provisions of the Indenture,
and delivered to and paid for by the Underwriters [or by institutional
investors pursuant to Delayed Delivery Contracts] will be valid and binding
obligations of the Company, enforceable in accordance with their respective
terms subject, as
-2-
<PAGE> 24
to enforcement, to bankruptcy, insolvency, reorganization, and other laws of
general applicability relating to or affecting creditors' rights and to general
equity principles, and will be entitled to the benefits of such Indenture.
(6) The Underwriting 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 bankruptcy, insolvency, reorganization, and other laws of
general applicability relating to or affecting creditors' rights and to general
equity principles, and except as rights to indemnity and contribution
thereunder may be limited under applicable law.
(7) The execution, delivery and performance of the
Underwriting Agreement and the Indenture and any applicable terms agreement
will not contravene any provision of applicable law or the Certificate of
Incorporation or By-laws of the Company or any material agreement or other
material instrument binding upon the Company, and no consent, approval or
authorization of any governmental body or agency other than pursuant to any
state securities or Blue Sky law is required for the performance of the
Underwriting Agreement and the issuance and sale of the Securities pursuant to
the Underwriting Agreement;
(8) The statements (1) in the Prospectus [under the captions
"Description of Debt Securities" (in the Prospectus Supplement), "Description
of Debt Securities" (in the Basic Prospectus) and "Plan of Distribution" (in
the Prospectus Supplement and in the Basic Prospectus)], (2) in the
Registration Statement under Item 15 and (3) in the Company's [Form 10] [most
recent Annual Report on Form 10-K under "Business" and "Legal Proceedings" and
in "Note 8 - Contingent Liabilities" in the Company's most recent quarterly
report on Form 10-Q], 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;
(9) After due inquiry, I do not know of any legal or
governmental proceeding 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 which is required to be described or of any
contract or other document which is required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required; and
(10) I (a) am of the opinion that (except as to financial
statements included therein, as to which I do not express any opinion) each
document, if any, filed pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and incorporated by reference in the Registration
Statement and the Prospectus complied when so filed as to form in all material
-3-
<PAGE> 25
respects with the Exchange Act and the rules and regulations of the Commission
thereunder, (b) am of the opinion that the Registration Statement and
Prospectus, as amended or supplemented, if applicable (except as to financial
statements included therein, as to which I do not express any opinion), comply
as to form in all material respects with the Securities Act and the applicable
rules and regulations thereunder, (c) believe that (except as to financial
statements and except for that part of the Registration Statement that
constitutes a Statement of Eligibility and Qualification (Form T-1) under the
Trust Indenture Act of 1939, as amended, as to which I do not express any
belief), each part of the Registration Statement when such part became
effective or was incorporated by reference into the Registration Statement did
not contain, and as of the date this 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, and (d) believe that (except as to financial statements, and except
for that part of the Registration Statement that constitutes a Form T-1
heretofore referred to as to which I do not express any belief) the
Registration Statement and the Prospectus, as amended or supplemented, if
applicable, do 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
light of the circumstances under which they were made, not misleading.
Yours very truly,
-4-
<PAGE> 26
[SASM&F Letterhead]
EXHIBIT B
_______, 199__
[Manager]
as Manager for the
Several Underwriters
[ADDRESS]_____________
______________________
______________________
Dear Sirs:
We have acted as special counsel for you, as Manager for the
several underwriters (the "Underwriters") named in the Underwriting Agreement,
dated _____________, 199__ (the "Underwriting Agreement"), with Williams
Holdings of Delaware, Inc., a Delaware corporation (the "Company"), in
connection with purchase by the several Underwriters of [$] [symbol for foreign
currency or currency unit] _________ principal amount of [Full Title of
Securities] (the "Debt Securities") of the Company to be issued pursuant to the
[senior] [subordinated] indenture, dated as of ________, 199__ (the
"Indenture") between the Company and Citibank, N.A., as Trustee.
This opinion is being furnished pursuant to Section 6(b) of the
Underwriting Agreement.
In connection with this opinion, we have examined originals or
copies, certified or otherwise identified to our satisfaction, of (i) the
Registration Statement on Form S-3 (File No. 33-____) relating to $400,000,000
aggregate principal amount of Debt Securities filed with the Securities and
Exchange Commission (the "Commission") on ____________ , 1995 under the
Securities Act of 1933, as amended (the "Act"), and [list all amendments
thereto] (such Registration Statement, as amended to the date of the
Underwriting Agreement, being hereinafter referred to as the "Registration
Statement"); (ii) the order of the Commission declaring the Registration
Statement effective under the Act and the Indenture qualified under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"); (iii) the
documents incorporated by reference in the Registration Statement; (iv) the
Prospectus, dated __________________ (the "Prospectus"), as supplemented by the
[Prospectus Supplement][Abbreviated Term Sheet], dated ___________________ (the
"Prospectus Supplement"), filed with the Commission pursuant to Rule 424 of the
General Rules and Regulations under the Act (the "Rules and Regulations"); (v)
the Statement of Eligibility and Qualification under the Trust Indenture Act on
Form T-1 of the Trustee (the "Form T-1"); (vi) an executed copy of the
Indenture; (vii) an executed copy of the Underwriting Agreement; (viii) the
<PAGE> 27
form of the Debt Securities and specimen certificates thereof; (ix) the
Certificate of Incorporation and By-laws of the Company, in each case, as
amended to date; and (x) certain resolutions of the Board of Directors of the
Company [and a Pricing Committee [of] [appointed by] the Board of Directors of
the Company]. We have also examined the originals or copies, certified or
otherwise identified to our satisfaction, of such records of the Company and
such agreements, certificates of public officials, certificates of officers or
other representatives of the Company and others, and such other documents,
certificates and records as we have deemed necessary or appropriate as a basis
for the opinions set forth herein.
In our examination, we have assumed the legal capacity of all
natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. In making our
examination of documents executed by parties other than the Company, we have
assumed that such parties had the power, corporate or other, to enter into and
perform all obligations thereunder and have also assumed the due authorization
by all requisite action, corporate or other, and execution and delivery by such
parties of such documents and the validity and binding effect thereof. As to
any facts material to the opinions expressed herein which were not
independently established or verified, we have relied upon oral or written
statements and representations of officers and other representatives of the
Company and others.
Members of our firm are admitted to the bar in the States of
New York and Delaware and we do not express any opinion as to the laws of any
other jurisdiction other than the laws of the United States of America to the
extent referred to specifically herein.
Based upon and subject to the limitations, qualifications,
exceptions and assumptions set forth herein, we are of the opinion that:
1. The Indenture has been duly authorized, executed and
delivered by the Company and, assuming due authorization, execution
and delivery thereof by the Trustee, is a valid and binding agreement
of the Company enforceable against the Company in accordance with its
terms, except to the extent that enforcement thereof may be limited by
(i) bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating
to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at
law or in equity).
2. The Debt Securities have been duly authorized and, when
executed and authenticated in accordance with the provisions of the
Indenture, and delivered to and paid for by the Underwriters [or by
institutional investors pursuant to
-2-
<PAGE> 28
Delayed Delivery Contracts] will be valid and binding obligations of
the Company entitled to the benefits of such Indenture and enforceable
against the Company in accordance with their respective terms except
to the extent that enforcement thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating
to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at
law or in equity).
3. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company and is a valid and binding
agreement of the Company, enforceable against the Company in
accordance with its terms except to the extent that (a) enforcement
thereof may be limited by (i) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity) and (b) the
indemnification and contribution provisions thereof may be limited by
Federal or state securities laws or the public policy underlying such
laws.
4. The Registration Statement, as of its effective date, and
the Prospectus as amended and supplemented by the Prospectus
Supplement, as of the date of the Prospectus Supplement, appeared on
their face to be appropriately responsive in all material respects to
the requirements of the Act and the Rules and Regulations, except that
in each case we express no opinion as to the financial statements,
schedules and other financial and statistical data included therein or
excluded therefrom, the documents incorporated by reference therein or
the exhibits to the Registration Statement, including the Form T-1,
and we do not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement,
the Prospectus or the Prospectus Supplement.
In addition, we have participated in conferences with officers
and other representatives of the Company, counsel for the Company,
representatives of the independent accountants of the Company and you at which
the contents of the Registration Statement, the Prospectus and the Prospectus
Supplement and related matters were discussed and, although we are not passing
upon, and do not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus as supplemented by the Prospectus Supplement and have made no
independent check or verification thereof, on the basis of the foregoing, no
facts have come to our attention that have led us to believe that the
Registration Statement, at the time it became effective, contained an untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Prospectus as supplemented by the Prospectus Supple-
-3-
<PAGE> 29
ment, as of the date of the Prospectus Supplement and as of the date hereof,
contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, except that we express no opinion or belief with respect to the
financial statements, schedules and other financial and statistical data
included therein or excluded therefrom or the exhibits to the Registration
Statement, including the Form T-1.
This opinion is furnished to you solely for your benefit in
connection with the closing under the Underwriting Agreement occurring today
and is not to be used, circulated, quoted or otherwise referred to for any
other purpose without our express written permission.
Very truly yours,
-4-
<PAGE> 1
EXHIBIT 1.2
Williams Holdings of Delaware, Inc.
$________________
Medium-Term Notes
Due More Than 9 Months from Date of Issue
U.S. DISTRIBUTION AGREEMENT
______________ 199__
[Underwriter ____________
_________________________
_________________________]
Dear Sirs:
Williams Holdings of Delaware, Inc., a Delaware corporation
(the "Company"), confirms its agreement with you with respect to the issue and
sale by the Company of up to $______________ (or the equivalent thereof in a
foreign currency or composite currency) aggregate initial public offering price
of its Medium-Term Notes due more than 9 months from date of issue (the
"Notes"). The Notes may be issued as senior indebtedness (the "Senior Notes")
or as subordinated indebtedness (the "Subordinated Notes") of the Company. The
Senior Notes will be issued pursuant to the provisions of a senior debt
indenture dated as of ___________ 199__ (as it may be supplemented or amended
from time to time, the "Senior Debt Indenture"), between the Company and
Citibank, N.A., as trustee. The Subordinated Notes will be issued pursuant to
the provisions of a subordinated debt indenture dated as of ___________, 199__
(as it may be supplemented or amended from time to time, the "Subordinated Debt
Indenture"), between the Company and Citibank, N.A., as trustee. The Senior
Debt Indenture and the Subordinated Debt Indenture are sometimes hereinafter
referred to individually as an "Indenture" and collectively as the
"Indentures", and Citibank, N.A. is sometimes referred to as the "Trustee".
The Notes will be issued in denominations of $100,000 (or, in the case of Notes
not denominated in U.S. dollars, the equivalent thereof in such foreign
currency or composite currency, rounded down to the nearest 1,000 units of such
foreign currency or composite currency) or any amount in excess thereof which
is an integral multiple of $1,000 (or, in the case of Notes not denominated in
U.S. dollars, 1,000 units of such foreign currency or composite currency). The
Notes will bear interest at rates to be provided in a supplement to the Basic
Prospectus referred to below.
The Company hereby appoints you as its exclusive agent for the purpose
of soliciting offers to purchase Notes from the Company by
<PAGE> 2
others and, on the basis of the representations and warranties herein
contained, but subject to terms and conditions herein set forth, you agree to
use your best efforts to solicit offers to purchase Notes upon terms acceptable
to the Company at such times and in such amounts as the Company shall from time
to time specify. In addition, you may also purchase Notes as principal for
resale to others, and, if requested by you, the Company will enter into a Terms
Agreement relating to such sale (a "Terms Agreement") in accordance with the
provisions of Section 2(b) hereof.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to the
Notes. Such registration statement, including the exhibits thereto, as amended
at the date of this Agreement, is hereinafter referred to as the "Registration
Statement". The Company proposes to file with the Commission from time to
time, pursuant to Rule 424 under the Securities Act of 1933, as amended (the
"Securities Act"), supplements to the prospectus included in the Registration
Statement that will describe certain terms of the Notes. The prospectus in the
form in which it appears in the Registration Statement is hereinafter referred
to as the "Basic Prospectus". The term "Prospectus" means the Basic Prospectus
together with the prospectus supplement or supplements (each a "Prospectus
Supplement") specifically relating to Notes, as filed with, or transmitted for
filing to, the Commission pursuant to Rule 424. As used herein, the terms
"Registration Statement", "Basic Prospectus", "Prospectus" and "Prospectus
Supplement" shall include in each case the documents, if any, incorporated by
reference therein. The terms "supplement" and "amendment" or "amend" as used
herein shall include all documents filed by the Company pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), subsequent to
the date of the Basic Prospectus that are deemed to be incorporated by
reference in the Prospectus.
1. Representations and Warranties. The Company
represents and warrants to you as of the Commencement Date (as hereinafter
defined), as of each date on which the Company accepts an offer to purchase
Notes, as of each date the Company issues and sells Notes and as of each date
the Registration Statement or the Basic Prospectus is amended or supplemented,
as follows (it being understood that such representations and warranties shall
be deemed to relate to the Registration Statement, the Basic Prospectus and the
Prospectus, each as amended and supplemented to each such date):
(a) The Registration Statement has become effective; no
stop order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or, to the
knowledge of the Company, threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed
pursuant to the Exchange Act and incorporated by reference in the Registration
Statement and the Prospectus complied or will comply when
2
<PAGE> 3
so filed in all material respects with the Exchange Act and the applicable
rules and regulations thereunder, (ii) each part of the Registration Statement,
when such part became effective or was incorporated by reference into the
Registration Statement, did not contain and each such part, 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, in light of circumstances under which
they were made, 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 applicable rules and
regulations thereunder and (iv) the Registration Statement and the Prospectus
do 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(b) do not apply (i) to statements or
omissions in the Registration Statement or the Prospectus based upon
information concerning the Agent furnished to the Company in writing by you
expressly for use therein or (ii) to that part of the Registration Statement
that constitutes the Statements of Eligibility and Qualification (Form T-1)
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"),
of the Trustees.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State of
Delaware 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, considered as one
enterprise.
(d) Each of [Williams Field Services, Inc., Williams Pipe
Line Company, Williams Energy Services Company, Williams Energy Ventures, Inc.,
Williams Telecommunications Services, Inc. and Vyvx, Inc.] (the "Material
Subsidiaries") has been duly incorporated, is validly existing as a corporation
in good standing under the laws of the jurisdiction of its incorporation 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, considered as one enterprise.
(e) Each of this Agreement and any applicable Terms
Agreement has been duly authorized, executed and delivered by the Company and
is a valid and binding agreement of the Company, except
3
<PAGE> 4
as rights to indemnity and contribution hereunder or thereunder may be limited
under applicable law.
(f) The Indenture pursuant to which the Notes will be
issued has been duly authorized, executed and delivered by the Company, is a
valid and binding agreement of the Company and has been duly qualified under
the Trust Indenture Act.
(g) The forms of Notes have been duly authorized, and,
when the Notes have been executed and authenticated in accordance with the
provisions of the relevant Indenture and delivered to and duly paid for by the
purchasers thereof, they will be valid and legally binding obligations of the
Company and will be entitled to the benefits of such Indenture.
(h) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement, the
Indentures, the Notes and any applicable Terms Agreement will not contravene
any provision of applicable law or the certificate of incorporation or by-laws
of the Company or any agreement or other instrument binding upon the Company or
any of its subsidiaries that is material to the Company and its subsidiaries,
considered as one enterprise, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any
subsidiary, and no consent, approval or authorization of any governmental body
or agency is required for the performance by the Company of its obligations
under this Agreement, the Indentures, the Notes or any applicable Terms
Agreement, 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 Notes.
(i) There has not been any material adverse change, or
any development which could reasonably be expected to result in a prospective
material adverse change, in the financial condition, or in the earnings,
business or operations of the Company and its subsidiaries, considered as one
enterprise, from that set forth in the Registration Statement.
(j) There are no legal or governmental proceeding pending
or, to the knowledge of the Company, 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 as an
exhibit to the Registration Statement that are not described or filed as
required.
(k) Each of the Company and its subsidiaries has all
necessary consents, authorizations, approvals, orders, certificates and permits
of and from, and has made all declarations and filings
4
<PAGE> 5
with, all federal, state, local and other governmental authorities and all
courts and other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the Prospectus,
as then amended or supplemented, except to the extent that the failure to
obtain or file would not have a material adverse effect on the Company and its
subsidiaries, considered as one enterprise.
2. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. In connection with your
actions as Agent hereunder, you will use your best efforts to solicit offers to
purchase Notes upon the terms and conditions set forth in the Prospectus as
then amended or supplemented.
The Company reserves the right, in its sole discretion, to
instruct you to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase Notes. Upon receipt of at least one
business day's prior notice from the Company, you will forthwith suspend
solicitations of offers to purchase Notes from the Company until such time as
the Company has advised you that such solicitation may be resumed. During the
period of time that such solicitation is suspended, the Company shall not be
required to deliver any certificates, opinions or letters in accordance with
Sections 5(a), 5(b) and 5(c); provided, however, that if the Registration
Statement or Prospectus is amended or supplemented (other than by an amendment
or supplement providing solely for a change in the interest rates, redemption
provisions, amortization schedules or maturities offered on the Notes or for a
change deemed immaterial in your reasonable opinion) during the period of
suspension, you shall not be required to resume soliciting offers to purchase
Notes until the Company has delivered such certificates, opinions and letters
as you may request.
The Company agrees to pay to you, as consideration for the
sale of each Note resulting from a solicitation made by you, a commission in
the form of a discount from the purchase price of such Note equal to between
.___% and .___% of such purchase price, depending upon such Note's maturity.
You are authorized to solicit offers to purchase Notes only in
the principal amount of $100,000 (or, in the case of Notes not denominated in
U.S. dollars, the equivalent thereof in such foreign currency or composite
currency, rounded down to the nearest 1,000 units of such foreign currency or
composite currency)' or any amount in excess thereof which is an integral
multiple of $1,000 (or, in the case of Notes not denominated in U.S. dollars,
1,000 units of such foreign currency or composite currency). You shall
communicate to the Company, orally or in writing, each offer to purchase Notes
received by you as agent that in your judgment should be considered by the
Company. The Company shall have the sole right to accept offers to purchase
Notes and may reject any offer in whole or in part. You
5
<PAGE> 6
shall have the right to reject any offer to purchase Notes that you consider to
be unacceptable, and any such rejection shall not be deemed a breach of your
agreements contained herein.
(b) Purchases as Principal. If requested by you in connection
with a sale of Notes directly to you as principal for resale to others, the
Company will enter into a separate Terms Agreement (with terms acceptable to it
and to you) that will provide for the sale of such Notes to and the purchase
and re-offering thereof by you in accordance with the terms of this Agreement
and the Terms Agreement. Each Terms Agreement shall be substantially in the
form of Exhibit A hereto but may take the form of an exchange of any form of
written telecommunication between you and the Company.
Your commitment to purchase Notes as principal shall be deemed
to have been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and conditions
herein set forth. Each agreement by you to purchase Notes as principal
(whether or not set forth in a Terms Agreement) shall specify the principal
amount of Notes to be purchased by you pursuant thereto, the maturity date
thereof, the price to be paid to the Company for such Notes and the time and
place of delivery of and payment for such Notes (each such date, a "Settlement
Date"). Each such agreement shall also specify any requirements for officers'
certificates, opinions of counsel and letters from the independent public
accountants of the Company pursuant to Section 4 hereof.
(c) Procedures. You and the Company agree to perform the
respective duties and obligations specifically provided to be performed in the
Medium Term Notes Administrative Procedures (attached hereto as Exhibit B) (the
"Procedures"), as amended from time to time. The Procedures may be amended
only by written agreement of the Company and you.
(d) Delivery. The documents required to be delivered by
Section 4 of this Agreement shall be delivered at the office of Skadden, Arps,
Slate, Meagher & Flom, your counsel, not later than 4 p.m., New York time, on
the date hereof, or at such other time and/or place as you and the Company may
agree upon in writing (the "Commencement Date").
3. Agreements. The Company agrees with you that:
(a) Prior to the termination of the offering of the Notes
pursuant to this Agreement or any Terms Agreement, the Company will not file
any Prospectus Supplement relating to the Notes or any amendment to the
Registration Statement unless the Company has previously furnished to you a
copy thereof for your review and will not file any such proposed supplement or
amendment to which you reasonably object; provided, however, that the foregoing
requirement shall not apply to any of the Company's periodic filings with the
Commission which may be required to be filed pursuant to Section
6
<PAGE> 7
13(a), 13(c), 13(f), 14 or 15(d) of the Exchange Act, copies of which filings,
if any, the Company will cause to be delivered to you promptly after being
transmitted for filing with the Commission. Subject to the foregoing sentence,
the Company will promptly cause each Prospectus Supplement to be filed with or
transmitted for filing to the Commission in accordance with Rule 424(b). The
Company will promptly advise you (i) of the filing of any amendment or
supplement to the Basic Prospectus, (ii) of the filing and effectiveness of any
amendment to the Registration Statement, (iii) of any request by the Commission
for any amendment of the Registration Statement or any amendment of or
supplement to the Basic Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the institution or threatening of any
proceeding for that purpose and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Notes
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose. The Company will use its best efforts to prevent the
issuance of any such stop order or notice of suspension of qualification and,
if issued, to obtain as soon as possible the withdrawal thereof. If the Basic
Prospectus is amended or supplemented as a result of the filing under the
Exchange Act of any document incorporated by reference in the Prospectus, you
shall not be obligated to solicit offers to purchase Notes so long as you are
not reasonably satisfied with such document.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Securities Act, any event occurs or
condition exists as a result of which the Registration Statement or the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact, or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances when the Prospectus, as
then amended or supplemented, is delivered to a purchaser, not misleading, or
if, in the opinion of the Company, it is necessary at any time to amend or
supplement the Registration Statement or the Prospectus, as then amended or
supplemented, to comply with law, the Company will immediately notify you by
telephone (with confirmation in writing) to suspend solicitation of offers to
purchase Notes and, if so notified by the Company, you shall forthwith suspend
such solicitation and cease using the Prospectus as then amended or
supplemented. If in your opinion it is necessary at any time to amend or
supplement the Registration Statement or the Prospectus, as then amended or
supplemented, to comply with law, you shall so notify the Company by telephone
(with confirmation in writing) and may suspend solicitation of offers to
purchase Notes. If the Company shall decide to amend or supplement the
Registration Statement or Prospectus as then amended or supplemented, it shall
so advise you promptly by telephone (with confirmation in writing) and, at its
expense, shall prepare and cause to be filed promptly with the Commission an
amendment or supplement to the Registration Statement or Prospectus as then
amended or supplemented that will correct such statement or omission or effect
7
<PAGE> 8
such compliance and will supply such amended or supplemented Prospectus to you
in such quantities as you may reasonably request. If such amendment or
supplement and any documents, certificates, opinions and letters furnished to
you pursuant to paragraph (f) below and Sections 5(a), 5(b) and 5(c) in
connection with the preparation and filing of such amendment or supplement are
satisfactory in all respects to you, upon the filing of such amendment or
supplement with the Commission or effectiveness of an amendment to the
Registration Statement, you will resume the solicitation of offers to purchase
Notes hereunder. Notwithstanding any other provision of this Section 3(b),
until the distribution of any Notes you may have purchased as principal for
resale pursuant to Section 2(b) has been completed, if any event described
above in this paragraph (b) occurs, the Company will, at its own expense,
forthwith prepare and cause to be filed promptly with the Commission an
amendment or supplement to the Registration Statement or Prospectus as then
amended or supplemented, satisfactory in all respects to you, and will supply
such amended or supplemented Prospectus to you in such quantities as you may
reasonably request. If such amendment or supplement and any documents,
certificates, opinions and letters furnished to you pursuant to paragraph (f)
below and Sections 5(a), 5(b) and 5(c) in connection with the preparation and
filing of such amendment or supplement are satisfactory in all respects to you,
upon the filing of such amendment or supplement with the Commission or
effectiveness of an amendment to the Registration Statement, you may resume
your resale of Notes as principal.
(c) The Company will make generally available to its
security holders and to you as soon as practicable earnings statements that
satisfy the provisions of Section 11(a) of the Securities Act covering twelve
month periods beginning, in each case, not later than the first day of the
Company's fiscal quarter next following the "effective date" (as defined in
Rule 158 under the Securities Act) of the Registration Statement with respect
to each sale of Notes. If such fiscal quarter is the last fiscal quarter of the
Company's fiscal year, such earning statements 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.
(d) The Company will furnish to you without charge two
signed copies of the Registration Statement and all amendments thereto,
including exhibits and any documents incorporated by reference therein, and
during the period mentioned in Section 3(b) above, as many copies of the
Prospectus, any documents incorporated by reference therein and any supplements
and amendments thereto as you may reasonably request.
(e) The Company will qualify the Notes for offer and sale
under the securities or blue sky laws of such jurisdictions as you shall
reasonably request, will maintain such qualifications for as long as you shall
reasonably request and will pay all expenses
8
<PAGE> 9
(including fees and disbursements of counsel) in connection with such
qualification and in connection with the determination of the eligibility of
the Notes for investment under the laws of such jurisdictions as you may
designate.
(f) During the term of this Agreement, the Company shall
furnish to you such relevant documents and certificates of officers of the
Company relating to the business, operations and affairs of the Company, the
Registration Statement, the Basic Prospectus, any amendments or supplements
thereto, the Indentures, the Notes, this Agreement, the Procedures, any Terms
Agreement and the performance by the Company of its obligations hereunder or
thereunder as you may from time to time reasonably request and shall notify you
promptly in writing of any downgrading or of its receipt of any notice of (A)
any intended or potential downgrading or (B) any review or possible change that
does not indicate the direction of a possible change in the rating accorded any
of the Company's securities by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2) under the
Securities Act.
(g) The Company will, whether or not any sale of Notes is
consummated, pay all reasonable expenses incident to the performance of its
obligations under this Agreement and any Terms 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 Notes, (iii) the reasonable fees and disbursements of the Company's
counsel and accountants and of the Trustees and their counsel, (iv) the
qualification of the Notes under securities or blue sky laws in accordance with
the provisions of Section 3(e), including filing fees and the reasonable fees
and disbursements of your counsel in connection therewith and in connection
with the preparation of any Blue Sky Memoranda, (v) the printing and delivery
to you in quantities as hereinabove stated of copies of the Registration
Statement and all amendments thereto, and of the Basic Prospectus and any
amendments or supplements thereto, (vi) the printing and delivery to you of
copies of the Indentures and any Blue Sky Memoranda, (vii) any fees charged by
rating agencies for the rating of the Notes, (viii) the fees and expenses, if
any, incurred with respect to any filing with the National Association of
Securities Dealers, Inc., (ix) the reasonable fees and disbursements of your
counsel incurred in connection with the offering and sale of the Notes and (x)
any reasonable out-of-pocket expenses incurred by you, including any
advertising expenses incurred by you with the approval of the Company.
(h) Between the date of any agreement pursuant to Section
2(b) by you to purchase Notes as principal and the Settlement Date with respect
to such agreement, the Company will not, without your prior consent, offer,
sell, contract to sell or otherwise dispose of any debt securities of the
Company substantially similar to the Notes (other than (i) the Notes that are
to be sold pursuant to such
9
<PAGE> 10
agreement and (ii) commercial paper issued in the ordinary course of business),
except as may otherwise be provided in such agreement.
4. Conditions of the Obligations of the Agent. Your
obligations to solicit offers to purchase Notes as agent of the Company, your
obligations to purchase Notes pursuant to any Terms Agreement or otherwise and
the obligations of any other purchaser to purchase Notes will be subject to the
accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the statements of the Company's officers made in
each certificate furnished pursuant to the provisions hereof prior to or
concurrently with any such solicitation or purchase, to the performance and
observance by the Company of all covenants and agreements herein contained on
its part to be performed and observed, in each case, at the time of such
solicitation or purchase and to the following additional conditions precedent:
(a) (i) There shall not have occurred any material
adverse change, or any development which could reasonably be expected to result
in a prospective material adverse change, in the financial condition, or in the
earnings, business or operations, of the Company and its subsidiaries, taken as
a whole, from that set forth in the Registration Statement and the Prospectus.
(ii) Since the date of this Agreement, there shall not
have occurred any (A) suspension or material limitation of trading generally on
or by, as the case may be, the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (B) suspension of trading of any securities of the Company on any
exchange or in the over-the-counter market, (C) declaration of a general
moratorium on commercial banking activities in New York by either Federal or
New York State authorities or (D) any outbreak or escalation of any hostilities
or any change in financial markets or any calamity or crisis that, in your
judgment, is material and adverse and, in the case of any of the events
described in clauses (ii) (A) through (D), such event, singly or together with
any other such event, makes it, in your judgment, impracticable to market the
Notes on the terms and in the manner contemplated by the Prospectus, as amended
or supplemented.
(iii) As of each Settlement Date, there shall not have been,
since the date of this Agreement, any downgrading, nor any notice given of (A)
any intended or potential downgrading or (B) any review or possible change that
does not indicate the direction of a possible change, in the rating accorded
any of the Company's securities by any "nationally recognized statistical
rating organization", as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act, except as disclosed to you in writing by the Company
prior to the date the Company accepted the offer to purchase the Notes to be
issued on such Settlement Date.
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<PAGE> 11
(b) On the Commencement Date and, if called for by any
agreement by you to purchase Notes as principal, on the corresponding
Settlement Date, you shall have received:
(i) The opinion, dated as of such date, of J. Furman
Lewis, Esq., General Counsel of the Company, to the effect that:
(A) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of Delaware 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;
(B) each of [Williams Field Services, Inc., Williams Pipe
Line Company, Williams Energy Services Company, Williams Energy
Ventures, Inc., Williams Telecommunications Services, Inc., and Vyvx,
Inc.] (the "Material Subsidiaries") has been duly incorporated, is
validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation 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;
(C) each of the Company and the Material Subsidiaries has
all consents, authorizations, approvals, orders, certificates and
permits of and from, and has made all declarations and filings with,
all federal, state, local and other governmental authorities, and all
courts and other tribunals, necessary to conduct its business in the
manner described in the Prospectus, except to the extent that the lack
of such consents, authorizations, approvals, orders, certificates or
permits would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(D) each Indenture pursuant to which the Notes will be
issued (i) has been duly authorized, executed and delivered by the
Company, (ii) assuming due authorization, execution and authentication
by the Trustee, is a valid and binding agreement of the Company,
enforceable in accordance with its terms and (iii) has been duly
qualified under the Trust Indenture Act of 1939, as amended;
(E) the forms of Notes have been duly authorized and,
when executed and authenticated in accordance with the provisions of
11
<PAGE> 12
the relevant Indenture and delivered to and paid for by the purchasers
thereof, will be valid and legally binding obligations of the Company,
enforceable in accordance with their respective terms, and will be
entitled to the benefits of such Indenture;
(F) each of this Agreement and any applicable Terms
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, except as rights to
indemnity and contribution hereunder or thereunder may be limited
under applicable law;
(G) the execution, delivery and performance of this
Agreement, the Indentures, the Notes and any applicable Terms
Agreement will not contravene any provision of applicable law or the
Certificate of Incorporation or By-laws of the Company or any material
agreement or other material instrument binding upon the Company, and
no consent, approval or authorization of any governmental body or
agency other than pursuant to any state securities or Blue Sky law is
required for the performance of this Agreement and the issuance and
sale of the Notes pursuant to this Agreement;
(H) the statements (l) in the Prospectus under the
captions "Description of Notes" (in the Prospectus Supplement),
"Description of Debt Securities" (in the Basic Prospectus) and "Plan
of Distribution" (in the Prospectus Supplement and in the Basic
Prospectus), (2) in the Registration Statement under Item 15 and (3)
in the Company's [Form 10] [most recent Annual Report on Form 10-K]
under "Business" and "Legal Proceedings" [and in "Note 8 - Contingent
Liabilities in the Company's most recent quarterly report on Form 10-
Q, 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;
(I) after due inquiry, such counsel does not know of any
legal or governmental proceeding 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 which
is required to be described in the Registration Statement or the
Prospectus and is not so described or of any contract or other
document which is required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required;
and
(J) such counsel (l) is of the opinion that each
document, if any, filed pursuant to the Securities Exchange Act of
1934,
12
<PAGE> 13
as amended (the "Exchange Act") (except as to financial statements
included therein, as to which such counsel need not express any
opinion), and incorporated by reference in the Registration Statement
and the Prospectus, as amended or supplemented, complied when so filed
as to form in all material respects with the Exchange Act and the
rules and regulations of the Commission thereunder, (2) believes that
(except as to financial statements and except for that part of the
Registration Statement that constitutes the Statements of Eligibility
and Qualification ("Form T-1") under the Trust Indenture Act of 1939,
as amended, as to all of which such counsel need not express any
belief) each part of the Registration Statement, as amended, if
applicable, when such part became effective or was incorporated by
reference into the Registration Statement 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, in light of the
circumstances under which they were made, not misleading, (3) is of
the opinion that the Registration Statement and Prospectus, as amended
or supplemented, if applicable (except as to financial statements
included therein and except for that part of the Registration
Statement that constitutes the Form T- 1, as to all of which such
counsel need not express any opinion), comply as to form in all
material respects with the Securities Act and the applicable rules and
regulations thereunder and (4) believes that (except as to financial
statements, and except for that part of the Registration Statement
that constitutes the Form T-1 heretofore referred to as to all of
which such counsel need not express any belief) the Registration
Statement and the Prospectus, as amended or supplemented, if
applicable, as of the Commencement Date or the date of your agreement
to purchase Notes as principal pursuant to Section 2(b), as the case
may be, did not, and as of the date such opinion is delivered, do 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
light of the circumstances under which they were made, not misleading.
In rendering such opinions, such counsel may qualify any
opinions as to enforceability by stating that such enforceability may be
limited by bankruptcy, insolvency, reorganization, liquidation, moratorium and
other similar laws affecting the rights and remedies of creditors and is
subject to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law). Such counsel
may rely, as to all matters governed by the laws of jurisdictions other than
the State of Oklahoma, the Delaware General Corporation Law, and the federal
law of the United States, upon the opinions of your and other counsel (copies
of which shall be delivered to you), who shall be counsel satisfactory to your
counsel, in which case the opinion shall state
13
<PAGE> 14
that such counsel believes he and you are entitled so to rely. Such counsel
may also state that, insofar as such opinion involves factual matters, he has
relied, to the extent he deems proper, upon certificates of officers of the
Company and its subsidiaries and certificates of public officials.
(ii) The opinion, dated as of such date, of Skadden, Arps,
Slate, Meagher & Flom, counsel to you, in substantially the form as set forth
as Exhibit C hereto.
[(iv) The opinion, dated as of such date, of
_____________________, special tax counsel to the Company, confirming the
accuracy of the opinion of such counsel set forth under the caption "United
States Federal Taxation" in the Prospectus Supplement.]
(c) On the Commencement Date and, if called for by any
agreement by you to purchase Notes as principal pursuant to Section 2(b), on
the corresponding Settlement Date, you shall have received a certificate, dated
such Commencement Date or Settlement Date, as the case may be, signed by an
officer of the Company to the effect that the representations and warranties of
the Company contained herein are true and correct as of such date and 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 such date.
The officer signing and delivering such certificate may rely
upon the best knowledge of the Company as to proceedings threatened.
(d) On the Commencement Date and, if called for by any
agreement by you to purchase Notes as principal pursuant to Section 2(b), on
the corresponding Settlement Date, the Company's independent public accountants
shall have furnished to you a letter or letters, dated as of the Commencement
Date or such Settlement Date, as the case may be, in form and substance
satisfactory to you containing statements and information of the type
ordinarily included in accountant's "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Registration Statement and the
Prospectus, as amended or supplemented.
(e) On the Commencement Date and on each Settlement Date
of a purchase pursuant to Section 2(b), the Company shall have furnished to you
such appropriate further information, certificates and documents as you may
reasonably request.
5. Additional Agreements of the Company. (a) Each time
the Registration Statement or Prospectus is amended or supplemented (other than
by an amendment or supplement providing solely for a change in the interest
rates, redemption provisions, amortization schedules or maturities offered on
the Notes or for a change deemed immaterial in your reasonable opinion), the
Company will deliver or
14
<PAGE> 15
cause to be delivered forthwith to you a certificate signed by an officer of
the Company, dated the date of such amendment or supplement, as the case may
be, in form reasonably satisfactory to you, of the same tenor as the
certificate referred to in Section 4(c) relating to the Registration Statement
or the Prospectus as amended and supplemented to the time of delivery of such
certificate.
(b) Each time the Company furnishes a certificate
pursuant to Section 5(a), the Company shall furnish or cause to be furnished
forthwith to you a written opinion of counsel for the Company. Any such
opinion shall be dated the date of such amendment or supplement, as the case
may be, shall be in a form satisfactory to you and shall be of the same tenor
as the opinion referred to in Section 4(b)(i), but modified to relate to the
Registration Statement or the Prospectus as amended and supplemented to the
time of delivery of such opinion. In lieu of such opinion, counsel last
furnishing such an opinion to you may furnish to you a letter to the effect
that you may rely on such last opinion to the same extent as though it were
dated the date of such letter (except that statements in such last opinion will
be deemed to relate to the Registration Statement or the Prospectus as amended
and supplemented to the time of delivery of such letter.)
(c) Each time the Registration Statement or the
Prospectus is amended or supplemented to set forth amended or supplemental
financial information or such amended or supplemental information is
incorporated by reference in the Registration Statement or the Prospectus, the
Company shall cause its independent public accountants forthwith to furnish you
with a letter, dated the date of such amendment or supplement, as the case may
be, in form satisfactory to you, of the same tenor as the letter referred to in
Section 4(d), with regard to the amended or supplemental financial information
included or incorporated by reference in the Registration Statement or the
Prospectus as amended or supplemented to the date of such letter.
6. Indemnification and Contribution. (a) The Company
agrees to indemnify and hold harmless you and each person, if any, who controls
you 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 or
liabilities caused by any untrue statement or allegedly untrue statement of a
material fact contained in the Registration Statement or in any amendment
thereof 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 allegedly untrue statement or omission based upon
information relating to you furnished to the Company in writing by you
expressly for use therein.
15
<PAGE> 16
(b) You agree 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 the Company to you, but only with reference to
information relating to you furnished to the Company in writing by you
expressly for use in the Registration Statement or 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) above, 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 reasonable 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 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 you in the case of parties indemnified pursuant to the second
preceding paragraph and by the Company in the case of parties indemnified
pursuant to the first preceding paragraph. 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 third
sentence of this paragraph, 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
16
<PAGE> 17
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) If 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 in
connection with any offering of Notes, 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 and you
from the offering of such Notes or (ii) if the allocation provided by clause
(i) 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 and you 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 and you in connection with the offering of such Notes shall be
deemed to be in the same respective proportions as the net proceeds from the
offering of such Notes before deducting expenses received by the Company and
the total discounts and commissions received by you in respect thereof, in each
case as set forth in the Prospectus Supplement relating to such Notes, bear to
the aggregate public offering price of such Notes. The relative fault of the
Company and of you shall be determined by reference to, among other things,
whether the untrue or allegedly 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 you and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
(e) The Company and you agree that it would not be just or
equitable if contribution pursuant to this Section 6 were determined by pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in paragraph (d) above. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in paragraph (d) above 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, you shall not be required to contribute any
amount in excess of the amount by which the total price at which the Notes
referred to in paragraph (d) above that were offered and sold to the public
through you exceeds the amount of any damages that you have otherwise been
required to pay by reason of such
17
<PAGE> 18
untrue or allegedly 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. Position of the Agent. In soliciting offers to
purchase the Notes, you are acting solely as agent for the Company, and not as
principal, and do not assume any obligation towards or relationship of agency
or trust with any purchaser of Notes. You shall make reasonable efforts to
assist the Company in obtaining performance by each purchaser whose offer to
purchase Notes has been solicited by you and accepted by the Company, but you
shall not have any liability to the Company in the event any such purchase is
not consummated for any reason. If the Company shall default in its
obligations to deliver Notes to a purchaser whose offer it has accepted, the
Company shall hold you harmless against any loss, claim, damage or liability
arising from or as a result of such default and shall, in particular, pay to
you the commission you would have received had such sale been consummated.
8. Termination. This Agreement may be terminated at any
time either by the Company or by you upon the giving of written notice of such
termination to the other party hereto. Any Terms Agreement shall be subject to
termination on the terms set forth therein. The termination of this Agreement
shall not require termination of any agreement by you to purchase Notes as
principal, and the termination of any such agreement shall not require
termination of this Agreement. If this Agreement is terminated, the provisions
of the third paragraph of Section 2(a), the last two sentences of Section 3(b)
and Sections 3(c), 3(g), 6, 7 and 9 shall survive; provided that if at the time
of termination an offer to purchase Notes has been accepted by the Company but
the time of delivery to the purchaser or its agent of such Notes has not
occurred, the provisions of Sections 2(c), 3(a) and 3(f) shall also survive.
If any Terms Agreement is terminated, the provisions of Sections 3(c), 3(g), 6
and 9 and the last two sentences of Section 3(b) (which shall have been
incorporated by reference in such Terms Agreement) shall survive.
9. Representations and Indemnities to Survive. The
respective indemnity and contribution agreements, representations, warranties
and other statements of the Company, its officers and you set forth in or made
pursuant to this Agreement or any agreement by you to purchase Notes as
principal will remain in full force and effect, regardless of any termination
of this Agreement, any investigation made by or on behalf of you or the Company
or any of the officers, directors or controlling persons referred to in Section
6 and delivery of and payment for the Notes.
18
<PAGE> 19
10. Notices. All communications hereunder will be in
writing and effective only on receipt, and, if sent to you, will be mailed,
delivered or telegraphed and confirmed to you at _____________________, with a
copy to Skadden, Arps, Slate, Meagher & Flom, 919 Third Avenue, New York, New
York 10022, Attention: Randall Doud or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at One Williams Center,
Tulsa, Oklahoma 74172 Attention: Chief Financial Officer, with a copy to its
General Counsel at the same address.
11. Successors. This Agreement and any Terms Agreement
will inure 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 the purchasers of Notes (to the extent expressly
provided in Section 4), and no other person will have any right or obligation
hereunder.
12. 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.
13. Applicable Law. This Agreement will be governed by
and construed in accordance with the internal laws of the State of New York.
14. 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.
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Company and you.
19
<PAGE> 20
Very truly yours,
WILLIAMS HOLDINGS OF DELAWARE, INC.
By________________________________
Title:
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
[UNDERWRITER]
By_________________________
Title:
20
<PAGE> 21
Exhibit A
WILLIAMS HOLDINGS OF DELAWARE, INC.
MEDIUM-TERM NOTES
TERMS AGREEMENT
___________________, 19___
Williams Holdings of Delaware, Inc.
One Williams Center
Tulsa, OK 74172
Attention:
Re: Distribution Agreement dated ________, 199__
(the Distribution Agreement")
The undersigned agrees to purchase the following principal
amount of your Medium-Term Notes: $
<TABLE>
<CAPTION>
Floating
Fixed Rate Rate
All Notes: Notes: Notes:
- ---------- ------ --------
<S> <C> <C>
Purchase Interest Base rate:
price: Rate:
Settlement Applicability Applicability
date and time: of modified of modified
payment upon following
Place of acceleration banking
delivery: day convention:
Amortization
Specified schedule: Index
currency: maturity:
Maturity Spread:
date:
Spread
Interest multiplier:
payment dates:
Alternate rate
Original issue event spread:
discount
provisions: Initial interest
rates:
Redemption
provisions: Initial interest
reset date:
</TABLE>
<PAGE> 22
<TABLE>
<S> <C>
Ranking:
Interest reset
Other terms: dates:
Maximum rate:
Minimum rate:
Interest reset
period:
Calculation agent:
</TABLE>
The provisions of Sections l, 2(b), 2(c), 2(d), 3, 4, 5, 6 and
8 through 14 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required: _______________
[UNDERWRITER]
By _____________________________
Title:
Accepted:
WILLIAMS HOLDINGS OF DELAWARE, INC.
By ______________________
Title:
2
<PAGE> 23
EXHIBIT B
WILLIAMS HOLDINGS OF DELAWARE, INC.
MEDIUM-TERM NOTES, ADMINISTRATIVE PROCEDURES
Explained below are the administrative procedures and specific
terms of the offering of Medium-Term Notes (the "Notes") on a continuous basis
by The Williams Companies, Inc. (the "Company") pursuant to the Distribution
Agreement, dated as of _____________, 199__ (the "Distribution Agreement")
between the Company and __________________ (the "Agent"). The Notes may be
issued as senior indebtedness (the "Senior Notes") or subordinated indebtedness
(the "Subordinated Notes") of the Company, and as used herein the term "Notes"
includes the Senior Notes and the Subordinated Notes. Subordinated Notes will
be subordinate to all Senior Notes. In the Distribution Agreement, the Agent
has agreed to use its best efforts to solicit purchases of the Notes. [The
Agent, as principal, may purchase Notes for its own account and if requested by
the Agent, the Company and the Agent will enter into a terms agreement, as
contemplated by the Distribution Agreement.]
The Senior Notes will be issued pursuant to the provisions of
a senior debt indenture dated as of ___________ 1990 (as it may be supplemented
or amended from time to time, the "Senior Debt Indenture"), between the Company
and Citibank, N.A. ("Citibank"), as trustee. The Subordinated Notes will be
issued pursuant to the provisions of a subordinated debt indenture dated as of
________________ 1995 (as it may be supplemented or amended from time to time,
the "Subordinated Debt Indenture"), between the Company and Citibank, as
trustee. The Senior Debt Indenture and the Subordinated Debt Indenture are
sometimes hereinafter referred to individually as an "Indenture" and
collectively as the "Indentures." Citibank, will be the Registrar, the
Calculation Agent, Authenticating Agent, and Paying Agent for both the Senior
Notes and the Subordinated Notes and will perform the duties specified herein.
Notes will bear interest at a fixed rate (the "Fixed Rate Notes"), which may be
zero in the case of certain original issue discount notes (the "OID Notes"), or
at floating rates (the "Floating Rate Notes"). Fixed Rate Notes may pay a
level amount in respect of both interest and principal amortized over the life
of the Notes (the "Amortizing Notes"). The Notes will be issued in U.S.
dollars or other currencies, including composite currencies such as the
European Currency Unit (the "Specified Currency"). Each Note will be
represented by either a Global Security (as defined below) delivered to
Citibank, as agent for the Depository Trust Company ("DTC"), and recorded in
the book-entry system maintained by DTC (a "Book-Entry Note") or a certificate
delivered to the holder thereof or a person designated
<PAGE> 24
by such holder (a "Certificated Note"). Except in limited circumstances, an
owner of a Book-Entry Note will not be entitled to receive a Certificated Note.
Book-Entry Notes, which may only be denominated and payable in
U.S. dollars, will be issued in accordance with the administrative procedures
set forth in Part I hereof as they may subsequently be amended as the result of
changes in DTC'S operating procedures, and Certificated Notes will be issued in
accordance with the administrative procedures set forth in Part II hereof.
Unless otherwise defined herein, terms defined in the Indentures or the Notes
shall be used herein as therein defined.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes
for eligibility in the book-entry system maintained by DTC, Citibank will
perform the custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representation from the Company and Citibank to DTC, dated as of the date
hereof (the "Letter of Representation"), and a Medium Term Note Certificate
Agreement between Citibank and DTC, dated as of _______________, and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: On any date of settlement (as defined under
"Settlement" below) for one or more Book-Entry Notes,
the Company will issue a single global security in
fully registered form without coupons (a "Global
Security") representing up to $100,000,000 principal
amount of all such Notes that have the same Maturity
Date, redemption provisions, ranking, Interest
Payment Dates, Original Issue Date, original issue
discount provisions (if any) and, in the case of
Fixed Rate Notes, Interest Rate and amortization
schedule (if any) or, in the case of Floating Rate
Notes, Initial Interest Rate, Base Rate, Index
Maturity, Interest Reset Period, Interest Reset
Dates, Spread or Spread Multiplier (if any), Minimum
Interest Rate (if any) and Maximum Interest Rate (if
any) and, in each case, any other relevant terms
(collectively "Terms"). Each Global Security will be
dated and issued as of the date of its authentication
by Citibank. Each Global Security will bear an
"Interest Accrual Date," which will be
2
<PAGE> 25
(i) with respect to an original Global Security (or
any portion thereof), its original issuance date and
(ii) with respect to any Global Security (or any
portion thereof) issued subsequently upon exchange of
a Global Security, or in lieu of a destroyed, lost or
stolen Global Security, the most recent Interest
Payment Date to which interest has been paid or duly
provided for on the predecessor Global Security or
Securities (or if no such payment or provision has
been made, the original issuance date of the
predecessor Global Security), regardless of the date
of authentication of such subsequently issued Global
Security. Book-Entry Notes may only be denominated
and payable in U.S. dollars. No Global Security will
represent any Certificated Note.
Identification The Company has arranged with the CUSIP
Numbers: Service Bureau of Standard & Poor's Corporation (the
"CUSIP Service Bureau") for the reservation of a
series of CUSIP numbers (including tranche numbers)
for each of the Senior Notes and the Subordinated
Notes, each of which series consists of approximately
900 CUSIP numbers and relates to Global Securities
representing the Book-Entry Notes. The Company has
obtained from the CUSIP Service Bureau a written list
of each series of reserved CUSIP numbers and has
delivered to Citibank and DTC the written list of 900
CUSIP numbers of each such series. Citibank will
assign CUSIP numbers to Global Securities as
described below under Settlement Procedure "B". DTC
will notify the CUSIP Service Bureau periodically of
the CUSIP numbers that Citibank has assigned to
Global Securities. At any time when fewer than 100
of the reserved CUSIP numbers of either series remain
unassigned to Global Securities, Citibank shall so
advise the Company and, if it deems necessary, the
Company will reserve additional CUSIP numbers for
assignment to Global Securities representing
Book-Entry Notes. Upon obtaining such additional
CUSIP numbers, the Company shall deliver a list
3
<PAGE> 26
of such additional CUSIP numbers to Citibank and DTC.
Registration: Each Global Security will be registered in the name
of Cede & Co., as nominee for DTC, on the Security
register maintained under the relevant Indenture.
The beneficial owner of a Book- Entry Note (or one or
more indirect participants in DTC designated by such
owner) will designate one or more participants in DTC
(with respect to such Note, the "Participants") to
act as agent or agents for such owner in connection
with the book-entry system maintained by DTC, and DTC
will record in book-entry form, in accordance with
instructions provided by such Participants, a credit
balance with respect to such beneficial owner in such
Note in the account of such Participants. The
ownership interest of such beneficial owner in such
Note will be recorded through the records of such
Participants or through the separate records of such
Participants and one or more indirect participants in
DTC.
Transfers: Transfers of a Book-Entry Note will be accompanied by
book entries made by DTC and, in turn, by
Participants (and in certain cases, one or more
indirect participants in DTC) acting on behalf of
beneficial transferors and transferees of such Note.
Exchanges: Citibank may deliver to DTC and the CUSIP Service
Bureau at any time a written notice of consolidation
specifying (i) the CUSIP numbers of two or more
Outstanding Global Securities that represent
Book-Entry Notes having the same Terms and for which
interest has been paid to the same date, (ii) a date,
occurring at least thirty days after such written
notice is delivered and at least thirty days before
the next Interest Payment Date for such Book-Entry
Notes, on which such Global Securities shall be
exchanged for a single replacement Global Security
and (iii) a new CUSIP number to be assigned to such
replacement Global Security. Upon receipt of such a
notice,
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<PAGE> 27
DTC will send to its Participants (including
Citibank) a written reorganization notice to the
effect that such exchange will occur on such date.
Prior to the specified exchange date, Citibank will
deliver to the CUSIP Service Bureau a written notice
setting forth such exchange date and the new CUSIP
number and stating that, as of such exchange date,
the CUSIP numbers of the Global Securities to be
exchanged will no longer be valid. On the specified
exchange date, Citibank will exchange such Global
Securities for a single Global Security bearing the
new CUSIP number and a new Interest Accrual -Date,
and the CUSIP numbers of the exchanged Global
Securities will, in accordance with CUSIP Service
Bureau procedures, be cancelled and not immediately
reassigned. Not withstanding the foregoing, if the
Global Securities to be exchanged exceed $100,000,000
in aggregate principal amount, one Global Security
will be authenticated and issued to represent each
$100,000,000 principal amount of the exchanged Global
Security and an additional Global Security will be
authenticated and issued to represent any remaining
principal amount of such Global Securities (see
"Denominations" below).
Maturities: Each Book-Entry Note will mature on a date more than
nine months after the settlement date for such Note.
Notice of Citibank will give notice to DTC
Redemption Dates: prior to each Redemption Date (as specified in the
Note), if any, at the time and in the manner set
forth in the Letter of Representation.
Denominations: Book-Entry Notes will be issued in principal amounts
of $100,000 or any amount in excess thereof that is
an integral multiple of $1,000. Global Securities
will be denominated in principal amounts not in
excess of $100,000,000. If one or more Book-Entry
Notes having an aggregate principal amount in excess
of $100,000,000 would, but for the preceding
sentence, be
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<PAGE> 28
represented by a single Global Security, then one
Global Security will be issued to represent each
$100,000,000 principal amount of such Book-Entry Note
or Notes and an additional Global Security will be
issued to represent any remaining principal amount of
such Book-Entry Note or Notes. In such a case, each
of the Global Securities representing such Book-Entry
Note or Notes shall be assigned the same CUSIP
number.
Interest: General. Interest on each Book-Entry Note will
accrue from the Interest Accrual Date of the Global
Security representing such Note. Each payment of
interest on a Book-Entry Note will include interest
accrued to but excluding the Interest Payment Date;
provided that in the case of Floating Rate Notes that
reset daily or weekly, interest payments will include
interest accrued to and including the Record Date
immediately preceding the Interest Payment Date,
except that at maturity or earlier redemption, the
interest payable will include interest accrued to,
but excluding, the maturity date or the date of
redemption, as the case may be. Interest payable at
the maturity or upon redemption of a Book-Entry Note
will be payable to the person to whom the principal
of such Note is payable. Standard & Poor's
Corporation will use the information received in the
pending deposit message described under Settlement
Procedure "C" below in order to include the amount of
any interest payable and certain other.information
regarding the related Global Security in the
appropriate weekly bond report published by Standard
& Poor's Corporation.
Record Date. The Record Date with respect to any
Interest Payment Date shall be the date fifteen
calendar days immediately preceding such Interest
Payment Date.
Fixed Rate Book-Entry Notes. Interest payments on
Fixed Rate Book-Entry Notes
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<PAGE> 29
other than Amortizing Notes will be made semiannually
on March l and September 1 of each year and at
maturity and Book-Entry Amortizing Notes will pay
principal and interest semiannually each March 1 and
September l, or quarterly each March l, June 1,
September 1, and December l, and at maturity;
provided, however, that in the case of a Fixed Rate
Book-Entry Note issued between a Record Date and an
Interest Payment Date, the first interest payment
will be made on the Interest Payment Date following
the next succeeding Record Date.
Floating Rate Book-Entry Notes. Interest payments
will be made on Floating Rate Book-Entry Notes
monthly, quarterly, annually or annually. Unless
otherwise agreed upon, interest will be payable, in
the case of Floating Rate Book-Entry Notes with a
daily, weekly or monthly Interest Reset Date, on the
third Wednesday of each month or on the third
Wednesday of March, June, September and December, as
specified pursuant to Settlement Procedure "A" below;
in the case of Notes with a quarterly Interest Reset
Date, on the third Wednesday of March, June,
September and December of each year; in the case of
Notes with a semi annual Interest Reset Date, on the
third Wednesday of the two months specified pursuant
to Settlement Procedure "A" below; and in the case of
Notes with an annual Interest Reset Date, on the
third Wednesday of the month specified pursuant to
Settlement Procedure "A" below; provided however,
that if an Interest Payment Date for Floating Rate
Book-Entry Notes would otherwise be a day that is not
a Business Day with respect to such Floating Rate
Book-Entry Notes, such Interest Payment Date will be
the next succeeding Business Day with respect to such
Floating Rate Book-Entry Notes, except in the case of
a LIBOR Note if such Business Day is in the next
succeeding calendar month, such Interest Payment Date
will be the immediately preceding Business Day;
andprovided, further, that in the case of a
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<PAGE> 30
Floating Rate Book-Entry Note issued between a Record
Date and an Interest Payment Date, the first interest
payment will be made on the Interest Payment Date
following the next succeeding Record Date.
Notice of Interest Payment and Record Dates. On the
first Business Day of January, April, July and
October of each year, Citibank will deliver to the
Company and DTC a written list of Record Dates and
Interest Payment Dates that will occur with respect
to Book-Entry Notes during the six-month period
beginning on such first Business Day.
Calculation of Fixed Rate Book-Entry Notes.
Interest: Interest on Fixed Rate Book-Entry Notes (including
interest for partial periods) will be calculated on
the basis of a year of twelve thirty-day months.
Floating Rate Book-Entry Notes. Interest rates on
Floating Rate Book-Entry Notes will be determined as
set forth in the form of Notes. Interest on Floating
Rate Book-Entry Notes will be calculated on the basis
of actual days elapsed and a year of 360 days except
that in the case of Treasury Rate Notes, interest
will be calculated on the basis of the actual number
of days in the year.
Payments of Payments of Interest. Promptly after each
Principal and after each Record Date, Citibank
Interest: will deliver to the Company and DTC a written notice
specifying by CUSIP number the amount of interest to
be paid on each Global Security (other than an
Amortizing Note) on the following Interest Payment
Date (other than an Interest Payment Date coinciding
with maturity) and the total of such amounts. DTC
will confirm the amount payable on each such Global
Security on such Interest Payment Date by reference
to the daily bond reports published by Standard &
Poor's Corporation. In the case of Amortizing Notes,
Citibank will provide separate written notice to DTC
prior to each
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<PAGE> 31
Interest Payment Date at the times and in the manner
set forth in the better of Representation. The
Company will pay to Citibank, as paying agent, the
total amount of interest due on such Interest Payment
Date (and, in the case of an Amortizing Note,
principal and interest) (other than at maturity), and
Citibank will pay such amount to DTC at the times and
in the manner set forth below under "Manner of
Payment." If any Interest Payment Date for a Fixed
Rate Book- Entry Note is not a Business Day, the
payment due on such day shall be made on the next
succeeding Business Day and no interest shall accrue
on such payment for the period from and after such
Interest Payment Date.
Payments at Maturity or Upon Redemption. On or about
the first Business Day of each month, Citibank will
deliver to the Company and DTC a written list of
principal and interest to be paid on each Global
Security (other than an Amortizing Note) maturing
either at maturity or on a redemption date in the
following month. The Company and DTC will confirm
the amounts of such principal and interest payments
with respect to each such Global Security on or about
the fifth Business Day preceding the Maturity Date or
redemption date of such Global Security. In the case
of Amortizing Notes, Citibank will provide separate
written notice to DTC prior to each Interest Payment
Date at the times and in the manner set forth in the
Letter of Representation. The Company will pay to
Citibank, as the paying agent, the principal amount
of such Global Security, together with interest due
at such Maturity Date or redemption date. Citibank
will pay such amounts to DTC at the times and in the
manner set forth below under "Manner of Payment." If
any Maturity Date or redemption date of a Global
Security representing Book-Entry Notes is not a
Business Day, the payment due on such day shall be
made on the next succeeding Business Day and, in the
case of Fixed Rate Notes, no interest shall accrue on
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<PAGE> 32
such payment for the period from and after such
Maturity Date or redemption date. Promptly after
payment to DTC of the principal and interest due on
the Maturity Date or redemption date of such Global
Security, Citibank will cancel such Global Security
in accordance with the terms of the relevant
Indenture and deliver it to the Company with a
certificate of cancellation.
Manner of Payment. The total amount of any principal
and interest due on Global Securities on any Interest
Payment Date or at maturity or upon redemption shall
be paid by the Company to Citibank in funds available
for immediate use by Citibank as of 9:30 A.M. (New
York City time) on such date. The Company will make
such payment on such Global Securities by instructing
Citibank to withdraw funds from an account maintained
by the Company at Citibank. The Company will confirm
such instructions in writing to Citibank. Prior to 10
A.M. (New York City time) on each Maturity Date or
redemption date or as soon as possible thereafter,
Citibank will pay by separate wire transfer (using
Fedwire message entry instructions in a form
previously specified by DTC) to an account at the
Federal Reserve Bank of New York previously specified
by DTC, in funds available for immediate use by DTC,
each payment of interest or principal (together with
interest thereon) due on Global Securities on any
Maturity Date or redemption date. On each Interest
Payment Date, interest payments (and, in the case of
Amortizing Notes, interest and principal payments)
shall be made to DTC in same day funds in accordance
with existing arrangements between Chemical and DTC.
Thereafter on each such date, DTC will pay, in
accordance with its SDFS operating procedures then in
effect, such amounts in funds available for immediate
use to the respective Participants in whose names the
Book-Entry Notes represented by such Global
Securities are recorded in the book-entry system
maintained by DTC. Neither the Company
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<PAGE> 33
nor Citibank shall have any responsibility or
liability for the payment by DTC to such Participants
of the principal of and interest on the Book-Entry
Notes.
Withholding Taxes. The amount of any taxes required
under applicable law to be withheld from any interest
payment on a Book-Entry Note will be determined and
withheld by the Participant, indirect participant in
DTC or other person responsible for forwarding
payments directly to the beneficial owner of such
Note.
Preparation of If any order to purchase a Book-Entry
Pricing Note is accepted by or on behalf of the
Supplement: Company, the Company will prepare a pricing
supplement (a "Pricing Supplement") reflecting the
terms of such Note and will arrange to file 10 copies
of such Pricing Supplement with the Commission in
accordance with the applicable paragraph of Rule
424(b) under the Act, will deliver the number of
copies of such Pricing Supplement to the Agent as the
Agent shall request by the close of business on the
following Business Day and will, on the Agent's
behalf, file five copies of such Pricing Supplement
with the National Association of Securities Dealers,
Inc. (the "NASD"). The Agent will cause such Pricing
Supplement to be delivered to the purchaser of the
Note.
In each instance that a Pricing Supplement is
prepared, the Agent will affix the Pricing Supplement
to Prospectuses prior to their use. Outdated Pricing
Supplements, and the Prospectuses to which they are
attached (other than those retained for files), will
be destroyed.
Settlement: The receipt by the Company of immediately available
funds in payment for a Book-Entry Note and the
authentication and issuance of the Global Security
representing such Note shall constitute "settlement"
with respect to such Note.
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<PAGE> 34
All orders accepted by the Company will be settled on
the fifth Business Day pursuant to the timetable for
settlement set forth below unless the Company and the
purchaser agree to settlement on another day which
shall be no earlier than the next Business Day.
Settlement Settlement Procedures with regard to
Procedures: each Book-Entry Note sold by the Company to or
through the Agent, (except pursuant to a Terms
Agreement, as defined in the Distribution Agreement),
shall be as follows:
A. The Agent will advise the Company by
telephone that such Note is a Book-Entry Note
and of the following settlement information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed Rate
Book-Entry Note, the interest rate
and whether such Note is an
Amortizing Note, or in the case of a
Floating Rate Book-Entry Note, the
Initial Interest Rate (if known at
such time), Base Rate, Index
Maturity, Interest Reset Period,
Initial Interest Reset Date,
Interest Reset Dates, Spread or
Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any), the
Alternate Rate Event Spread (if any)
and the applicability of the
Modified Following Banking Day
Convention.
4. Interest Payment Dates.
5. Redemption provisions, if any.
6. Ranking.
7. Settlement date.
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<PAGE> 35
8. Price.
9. Agent's commission, if any,
determined as provided in the
Distribution Agreement.
10. Whether the Note is an OID Note, and
if it is an OID Note, the total
amount of OID, the yield to
maturity, the initial accrual period
OID and the applicability of
Modified Payment upon Acceleration.
11. Any other applicable Terms.
B. The Company will advise Citibank by telephone
or electronic transmission (confirmed in
writing at any time on the same date) of the
information set forth in Settlement Procedure
"A" above. Citibank will then assign a CUSIP
number to the Global Security representing
such Note and will notify the Company and the
Agent of such CUSIP number by telephone as
soon as practicable.
C. Citibank will enter a pending deposit message
through DTC's Participant Terminal System,
providing the following settlement
information to DTC, the Agent and Standard &
Poor's Corporation:
1. The information set forth in
Settlement Procedure "A".
2. The Initial Interest Payment Date
for such Note, the number of days by
which such date succeeds the related
DTC Record Date (which in the case
of Floating Rate Notes which reset
daily or weekly, shall be the date
five calendar days immediately
preceding the applicable Interest
Payment Date and, in the case of all
other Notes, shall be the Record
Date as defined in the Note) and
amount of interest
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<PAGE> 36
payable on such Initial Interest
Payment Date.
3. The CUSIP number of the Global
Security representing such Note.
4. Whether such Global Security will
represent any other Book-Entry Note
(to the extent known at such time).
5. Whether such Note is an Amortizing
Note (by appropriate notation in the
comments field of DTC's Participant
Terminal System).
D. Citibank will complete and authenticate the
Global Security representing such Note.
E. DTC will credit such Note to Citibank's
participant account at DTC.
F. Citibank will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC to (i) debit such Note to
Citibank's participant account and credit
such Note to the Agent's participant account
and (ii) debit the Agent's settlement account
and credit Chemical's settlement account for
an amount equal to the price of such Note
less the Agent's commission, if any. The
entry of such a deliver order shall
constitute a representation and warranty by
Chemical to DTC that (a) the Global Security
representing such Book-Entry Note has been
issued and authenticated and (b) Citibank is
holding such Global Security pursuant to the
Medium Term Note Certificate Agreement
between Citibank and DTC.
G. Unless the Agent purchased such Note as
principal, the Agent will enter an SDFS
deliver order through DTC's
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<PAGE> 37
Participant Terminal System instructing DTC
(i) to debit such Note to the Agent's
participant account and credit such Note to
the participant accounts of the Participants
with respect to such Note and (ii) to debit
the settlement accounts of such Participants
and credit the settlement account of the
Agent for an amount equal to the price of
such Note.
H. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures "F" and "G" will be settled in
accordance with SDFS operating procedures in
effect on the settlement date.
I. Citibank will credit to the account of the
Company maintained at Citibank Bank, New
York, New York, in funds available for
immediate use in the amount transferred to
Citibank in accordance with Settlement
Procedure "F".
J. Unless the Agent purchased such Note as
principal, the Agent will confirm the
purchase of such Note to the purchaser either
by transmitting to the Participants with
respect to such Note a confirmation order or
orders through DTC's institutional delivery
system or by mailing a written confirmation
to such purchaser.
K. Monthly, Citibank will send to the Company a
statement setting forth the principal amount
of Notes Outstanding as of that date under
the Indentures and setting forth a brief
description of any sales of which the Company
has advised Citibank but which have not yet
been settled.
Settlement For sales by the Company of Book-
Procedures Entry Notes to or through the Agent
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<PAGE> 38
Timetable: (except pursuant to a Terms Agreement) for settlement
on the first Business Day after the sale date,
Settlement Procedures 'A" through "J" set forth above
shall be completed as soon as possible but not later
than the respective times (New York City time) set
forth below:
Settlement
Procedure Time
---------- ----
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one Business Day
after the sale date, Settlement Procedures "A", "B"
and "C" shall be completed as soon as practicable but
no later than 11:00 A.M., 12 Noon and 2:00 P.M.,
respectively, on the first Business Day after the
sale date. If the Initial Interest Rate for a
Floating Rate Book-Entry Note has not been determined
at the time that Settlement Procedure "A" is
completed, Settlement Procedure "B" and "C" shall be
completed as soon as such rate has been determined
but no later than 12 Noon and 2:00 P.M.,
respectively, on the second Business Day before the
settlement date. Settlement Procedure "H" is subject
to extension in accordance with any extension of
Fedwire closing deadlines and in the other events
specified in the SDFS operating procedures in effect
on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
cancel led, Citibank, after receiving notice from the
Company or the Agent, will deliver to DTC, through
DTC's Participant Terminal System, a cancellation
message to such effect by no later than 2:00 P.M. on
the
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<PAGE> 39
Business Day immediately preceding the scheduled
settlement date.
Failure to If Citibank fails to enter an SDFS
Settle: deliver order with respect to a Book-Entry Note
pursuant to Settlement Procedure "F", Citibank may
deliver to DTC, through DTC's Participant Terminal
System, as soon as practicable withdrawal message
instructing DTC to debit such Note to Citibank's
participant account, provided that Citibank's
participant account contains a principal amount of
the Global Security representing such Note that is at
least equal to the principal amount to be debited. If
a withdrawal message is processed with respect to all
the Book-Entry Notes represented by a Global
Security, Citibank will mark such Global Security
"cancel led," make appropriate entries in Citibank's
records and send such cancel led Global Security to
the Company. The CUSIP number assigned to such
Global Security shall, in accordance with CUSIP
Service Bureau procedures, be cancel led and not
immediately reassigned. If a withdrawal message is
processed with respect to one or more, but not all,
of the Book-Entry Notes represented by a Global
Security, Citibank will exchange such Global Security
for two Global Securities, one of which shall
represent such Book-Entry Note or Notes and shall be
cancel led immediately after issuance and the other
of which shall represent the remaining Book-Entry
Notes previously represented by the surrendered
Global Security and shall bear the CUSIP number of
the surrendered Global Security.
If the purchase price for any Book-Entry Note is not
timely paid to the Participants with respect to such
Note by the beneficial purchaser thereof (or a
person, including an indirect participant in DTC,
acting on behalf of such purchaser), such
Participants and, in turn, the Agent may enter SDFS
deliver orders through DTC's Participant Terminal
System reversing the orders entered pursuant to
Settlement Procedures "F" and
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<PAGE> 40
"G", respectively. Thereafter, Citibank will deliver
the withdrawal message and take the related actions
described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Book-Entry Note, DTC may
take any actions in accordance with its SDFS
operating procedures then in effect.
In the event of a failure to settle with respect to
one or more, but not all, of the Book-Entry Notes to
have been represented by a Global Security, Citibank
will provide, in accordance with Settlement
Procedures "D" and "F", for the authentication and
issuance of a Global Security representing the
Book-Entry Notes to be represented by such Global
Security and will make appropriate entries in its
records.
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
Citibank will serve as registrar in connection with the
Certificated Notes.
Issuance: Each Certificated Note will be dated and issued as of
the date of its authentication by Citibank. Each
Certificated Note will bear an Original Issue Date,
which will be (i)with respect to an original
Certificated Note (or any portion thereof), its
original issuance date (which will be the settlement
date) and (ii) with respect to any Certificated Note
(or portion thereof) issued subsequently upon
transfer or exchange of a Certificated Note or in
lieu of a destroyed, lost or stolen Certificated
Note, the original issuance date of the predecessor
Certificated Note, regardless of the date of
authentication of such subsequently issued
Certificated Note.
Registration: Certificated Notes will be issued only in fully
registered form without coupons.
Transfers and A Certificated Note may be presented
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<PAGE> 41
Exchanges: for transfer or exchange at the corporate trust
office of Citibank. Certificated Notes will be
exchange-able for other Certificated Notes having
identical terms but different denominations without
service charge. Certificated Notes will not be
exchangeable for Book-Entry Notes.
Maturities: Each Certificated Note will mature on a date more
than nine months from the settlement date for such
Note.
Currency: The currency denomination with respect to any
Certificated Note and the payment of interest and the
repayment of principal with respect to any such
Certificated Note shall be as set forth therein and
in the applicable Pricing Supplement.
Denominations: The denomination of any Certificated Note will be a
minimum of U.S. $100,000 or any amount in excess
thereof that is an integral multiple of U.S. $1,000
or the equivalent, as determined pursuant to the
provisions of the applicable Prospectus Supplement,
of U.S. $100,000 (rounded down to an integral
multiple of 1,000 units of such Specified Currency)
and any amount in excess thereof which is an integral
multiple of 1,000 units of such Specified Currency.
Interest: General. Interest on each Certificated Note will
accrue from the Original Issue Date of such Note for
the first interest period and from the most recent
date to which interest has been paid for all
subsequent interest periods. Each payment of
interest on a Certificated Note will include interest
accrued to but excluding the Interest Payment Date;
provided that in the case of Floating Rate Notes
which reset daily or weekly, interest payments will
include the Record Date immediately preceding the
Interest Payment Date, except that at maturity or
earlier redemption, the interest payable will include
interest accrued to, but excluding the Maturity Date
or the date of redemption, as the case may be.
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<PAGE> 42
Fixed Rate Certificated Notes. Unless otherwise
specified pursuant to Settlement Procedure "A" below,
interest payments on Fixed Rate Certificated Notes
other than Amortizing Notes will be made
semi-annually on March 1 and September 1 of each year
and at maturity and Certificated Amortizing Notes
will pay principal and interest semi-annually each
March l and September l, or quarterly each March l,
June l, September 1, and December l, and at maturity;
provided, however, that in the case of Certificated
Fixed Rate Notes issued between a Record Date and an
Interest Payment Date, the first interest payment
will be made on the Interest Payment Date following
the next succeeding Record Date.
Floating Rate Certificated Notes. Interest payments
will be made on Floating Rate Certificated Notes
monthly, quarterly, semi-annually or annually.
Interest will be payable, in the case of Floating
Rate Certificated Notes with a daily, weekly or
monthly Interest Reset Date, on the third Wednesday
of each month or on the third Wednesday of March,
June, September and December, as specified pursuant
to settlement procedure "A" below; in the case of
Notes with a quarterly interest Payment Reset Date,
on the third Wednesday of March, June, September and
December of each year; in the case of Notes with a
semi-annual Interest Reset Date, on the third
Wednesday of the two months specified pursuant to
Settlement Procedure All below; and in the case of
Notes with an annual Interest Reset Date, on the
third Wednesday of the month specified pursuant to
Settlement Procedure "A" below; provided, however,
that if an Interest Payment Date for Floating Rate
Certificated Notes would otherwise be a day that is
not a Business Day with respect to such Floating Rate
Certificated Notes, such Interest Payment Date will
be the next succeeding Business Day with respect to
such Floating Rate Certificated Notes, except in the
case of a LIBOR Note if such Business Day is in
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<PAGE> 43
the next succeeding calendar month, such Interest
Payment Date will be the immediately preceding
Business Day; andprovided, further, that in the case
of a Floating Rate Certificated Note issued between a
Record Date wand an Interest Payment Date, the first
interest payment will be made on the Interest Payment
Date following the next succeeding Record Date.
Calculation of Fixed Rate Certificated Notes.
Interest: Interest on Fixed Rate Certificated Notes (including
interest for partial periods) will be calculated on
the basis of a year of twelve thirty-day months.
Floating Rate Certificated Notes.
Interest rates on Floating Rate Certificated Notes
will be determined as set forth in the form of Notes.
Interest on Floating Rate Certificated Notes will be
calculated on the basis of actual days elapsed and a
year of 360 days except that in the case of Treasury
Rate Notes, interest will be calculated on the basis
of the actual number of days in the year.
Payments of Citibank will pay the principal
Principal and amount of each Certificated Note at
Interest: maturity or upon redemption upon presentation and
surrender of such Note to Citibank. Such payment,
together with payment of interest due at maturity or
upon redemption of such Note, will be made in funds
available for immediate use by Citibank and in turn
by the holder of such Note. Certificated Notes
presented to Citibank at maturity or upon redemption
for payment will be cancel led by Citibank and
delivered to the Company with a certificate of
cancellation. All interest payments on a
Certificated Note (other than interest due at
maturity or upon redemption) will be made by check
drawn on Citibank (or another person appointed by
Citibank) and mailed by Citibank to the person
entitled thereto as provided in such Note and the
relevant Indenture; provided, however, that the
holder of $10,000,000 or more of Notes having the
same Interest Payment Date
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<PAGE> 44
will be entitled to receive payment by wire transfer
of immediately available funds. Following each
Record Date, Citibank will furnish the Company with a
list of interest payments to be made on the following
Interest Payment Date for each Certificated Note and
in total for all Certificated Notes. Interest at
maturity or upon redemption will be payable to the
person to whom the payment of principal is payable.
Citibank will provide monthly to the Company lists of
principal and interest, to the extent ascertainable,
to be paid on Certificated Notes maturing or to be
redeemed in the next month. Citibank will be
responsible for withholding taxes on interest paid on
Certificated Notes as required by applicable law.
If any Interest Payment Date or the Maturity Date or
redemption date of a Fixed-Rate Certificated Note is
not a Business Day, the payment due on such day shall
be made on the next succeeding Business Day and no
interest shall accrue on such payment for the period
from and after such Interest Payment Date, Maturity
Date or redemption date, as the case may be. If any
Interest Payment Date or the Maturity Date or
redemption date for any Certificated Floating Rate
Note would fall on a day that is not a Business Day
with respect to such Note, such Interest Payment
Date, Maturity Date or redemption date will be the
following day that is a Business Day with respect to
such Note, except that, in the case of a Certificated
LIBOR Note, if such Business Day is in the next
succeeding calendar month, such Interest Payment Date
shall be the immediately preceding day that is a
Business Day with respect to such Certificated LIBOR
Note.
Preparation of If any order to purchase a Certificated
Pricing Note is accepted by or on behalf of the
Supplement: Company, the Company will prepare a pricing
supplement (a "Pricing Supplement") reflecting the
terms of such Note and will arrange to file 10 copies
of such Pricing Supplement with the
22
<PAGE> 45
Commission in accordance with the applicable
paragraph of Rule 424(b) under the Act, will deliver
the number of copies of such Pricing Supplement to
the Agent as the Agent shall request by the close of
business on the following Business Day and will, on
the Agent's behalf, file five copies of such Pricing
Supplement with the NASD. The Agent will cause such
Pricing Supplement to be delivered to the purchaser
of the Note.
In each instance that a Pricing Supplement is
prepared, the Agent will affix the Pricing Supplement
to Prospectuses prior to their use. Outdated Pricing
Supplements, and the Prospectuses to which they are
attached (other than those retained for files), will
be destroyed.
Settlement: The receipt by the Company of immediately available
funds in exchange for an authenticated Certificated
Note delivered to the Agent and the Agent's delivery
of such Note against receipt of immediately available
funds shall constitute "settlement" with respect to
such Note. All orders accepted by the Company will
be settled on or before the fifth Business Day next
succeeding the date of acceptance pursuant to the
timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on
another date.
Settlement Settlement Procedures with regard to each
Procedures: Certificated Note sold by the Company to or through
the Agent (except pursuant to a Terms Agreement)
shall be as follows:
A. The Agent will advise the Company by
telephone that such Note is a Certificated
Note and of the following settlement
information:
l. Name in which such Note is to be
registered ("Registered Owner").
23
<PAGE> 46
2. Address of the Registered Owner and
address for payment of principal and
interest.
3. Taxpayer identification number of
the Registered Owner (if available).
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed Rate
Certificated Note, the interest rate
and whether such Note is an
Amortizing Note or, in the case of a
Floating Rate Certificated Note, the
Initial Interest Rate (if known at
such time), Base Rate, Index
Maturity, Interest Reset Period,
Initial Interest Reset Date,
Interest Reset Dates, Spread or
Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any), the
Alternate Rate Event Spread (if any)
and the applicability of the
Modified Following Banking Day
Convention.
7. Interest Payment Dates.
8. Redemption provisions, if any.
9. Ranking.
10. Settlement date.
11. Price.
12. Agent's commission if any,
determined as provided in the
Distribution Agreement between the
Company and the Agent.
13. Whether the Note is an OID Note, and
if it is an OID Note, the total
amount of OID, the yield to
maturity, the initial accrual period
OID and the
24
<PAGE> 47
applicability of Modified Payment
upon Acceleration.
14. Any other applicable Terms.
B. The Company will advise Citibank by telephone
or electronic transmission (confirmed in
writing at any time on the sale date) of the
information set forth in Settlement Procedure
"A" above.
C. The Company will have delivered to Citibank a
pre-printed four-ply packet for such Note,
which packet will contain the following
documents in forms that have been approved by
the Company, the Agent and the Trustee:
1. Note with customer confirmation.
2. Stub One - For Citibank.
3. Stub Two - For Agent.
4. Stub Three - For the Company.
D. Citibank will complete such Note and
authenticate such Note and deliver it (with
the confirmation) and Stubs One and Two to
the Agent, and the Agent will acknowledge
receipt of the Note by stamping or otherwise
marking Stub One and returning it to
Citibank. Such delivery will be made only
against such acknowledgment of receipt and
evidence that instruct ions have been given
by the Agent for payment to the account of
the Company at Citibank Bank, New York, New
York, in funds available for immediate use,
of an amount equal to the price of such Note
less the Agent's commission, if any. In the
event that the instructions given by the
Agent for payment to the account of the
Company are revoked, the Company will as
promptly as possible wire
25
<PAGE> 48
transfer to the account of the Agent an
amount of immediately available funds equal
to the amount of such payment made.
E. Unless the Agent purchased such Note as
principal, the Agent will deliver such Note
(with confirmation) to the customer against
payment in immediately payable funds. The
Agent will obtain the acknowledgment of
receipt of such Note by retaining Stub Two.
F. Citibank will send Stub Three to the Company
by first-class mail. Periodically, Citibank
will also send to the Company a statement
setting forth the principal amount of the
Notes Outstanding as of that date under each
Indenture and setting forth a brief
description of any sales of which the Company
has advised Citibank but which have not yet
been settled.
Settlement For sales by the Company of Certificated
Procedures Notes to or through the Agent (except
Timetable: Agent (except pursuant to a Terms Agreement),
Settlement Procedures "A" through "F" set forth above
shall be completed on or before the respective times
(New York City time) set forth below:
Settlement
Procedure Time
--------- ----
A 2:00 P.M. on day before
settlement date
B 3:00 P.M. on day before
settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
Failure to If a purchaser fails to accept delivery
Settle: of and make payment for any Certificated Note, the
Agent will notify the Company and Citibank by
telephone and return such Note to Citibank. Upon
receipt of such
26
<PAGE> 49
notice, the Company will immediately wire transfer to
the account of the Agent an amount equal to the
amount previously credited thereto in respect of such
Note. Such wire transfer will be made on the
settlement date, if Possible, and in any event not
later than the Business Day following the settlement
date. If the failure shall have occurred for any
reason other than a default by the Agent in the
performance of its obligations hereunder and under
the Distribution Agreement with the Company, then the
Company will reimburse the Agent or Citibank, as
appropriate, on an equitable basis for its loss of
the use of the funds during the Period when they were
credited to the account of the Company. Immediately
upon receipt of the Certificated Note in respect of
which such failure occurred, Citibank will mark such
Note "cancelled," make appropriate entries in
Citibank's records and send such Note to the Company.
27
<PAGE> 1
EXHIBIT 5
October 18, 1995
Williams Holdings of Delaware, Inc.
One Williams Center
Tulsa, Oklahoma 74172
Gentlemen:
You have requested me, as General Counsel of The Williams Companies, Inc.,
to render my opinion regarding certain matters in connection with the
preparation and filing of a registration statement by Williams Holdings of
Delaware, Inc. (the "Company") on Form S-3 (the "Registration Statement") under
the Securities Act of 1933, as amended, with respect to $400,000,000 aggregate
initial offering price of debt securities ("Securities"). The Securities are to
be issued from time to time as either senior indebtedness of the Company under
an indenture between the Company and Citibank, N.A., as trustee, or as
subordinated indebtedness of the Company under an indenture between the Company
and Citibank, N.A., as trustee (collectively, the "Indentures"). The forms of
the Indentures and the Securities are filed as exhibits to the Registration
Statement.
I am familiar with the Certificate of Incorporation and the By-laws, each
as amended to date, of the Company and have examined the originals, or copies
certified or otherwise identified to my satisfaction, of corporate records of
the Company, statutes and other instruments and documents as the basis for the
opinion expressed herein. In addition, I am, or someone under my supervision is,
familiar with the forms of the Indentures and the Securities.
Based upon the foregoing, and having regard for such legal considerations
as I have deemed relevant, I am of the opinion that, when the Securities have
been duly authorized by the Board of Directors of the Company, the Indentures
have been duly executed and delivered and the Securities have been duly issued
in accordance with the provisions of the Indentures and duly paid for by the
purchasers thereof, all required corporate action will have been taken with
respect to the issuance and sale of the Securities, and the Securities will have
been validly issued and will constitute valid and binding obligations of the
Company enforceable in accordance with their terms except as enforceability may
be limited by bankruptcy, insolvency, reorganization or other laws relative to
or affecting generally the enforcement of creditor's rights and by principles of
equity.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to the undersigned appearing under
the caption "Legal Matters" in the related Prospectus.
Very truly yours,
/s/ J. FURMAN LEWIS
J. Furman Lewis
JFL/RHH/sa
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 and related Prospectus of Williams Holdings
of Delaware, Inc. for the registration of $400 million of debt securities and to
the incorporation by reference therein of our report dated July 14, 1995, with
respect to the consolidated financial statements and schedule of Williams
Holdings of Delaware, Inc. included in its Form 10 filed with the Securities and
Exchange Commission.
ERNST & YOUNG LLP
Tulsa, Oklahoma
October 18, 1995
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated February 20, 1995
(except with respect to the matters discussed in Notes A and C, as to which the
date is July 25, 1995), on the Transco Energy Company-Contributed Assets
combined financial statements for the year ended December 31, 1994 included in
Williams Holdings of Delaware, Inc.'s Form 10 incorporated by reference in this
registration statement and to all references to our Firm included in or made a
part of this registration statement.
ARTHUR ANDERSEN LLP
Houston, Texas
October 18, 1995
<PAGE> 1
EXHIBIT 24.1
WILLIAMS HOLDINGS OF DELAWARE, INC.
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each of the undersigned individuals, in
their capacity as a director or officer, or both, as hereinafter set forth below
their signature, of WILLIAMS HOLDINGS OF DELAWARE, INC., a Delaware corporation
("Williams"), does hereby constitute and appoint J. FURMAN LEWIS, BOBBY E. POTTS
and DAVID M. HIGBEE their true and lawful attorneys and each of them (with full
power to act without the others) their true and lawful attorneys for them and in
their name and in their capacity as a director or officer, or both, of Williams,
as hereinafter set forth below their signature, to sign a registration statement
on Form S-3 for the registration of debt securities of Williams with an initial
aggregate offering price not to exceed four hundred million dollars
($400,000,000), and any and all amendments to said registration statement and
any and all instruments necessary or incidental in connection therewith; and
THAT the undersigned Williams does hereby constitute and appoint J. FURMAN
LEWIS, BOBBY E. POTTS and DAVID M. HIGBEE its true and lawful attorneys and each
of them (with full power to act without the others) its true and lawful attorney
for it and in its name and on its behalf to sign said registration statement and
any and all amendments thereto and any and all instruments necessary or
incidental in connection therewith.
Each of said attorneys shall have full power of substitution and
resubstitution, and said attorneys or any of them or any substitute appointed by
any of them hereunder shall have full power and authority to do and perform in
the name and on behalf of each of the undersigned, in any and all capacities,
every act whatsoever requisite or necessary to be done in the premises, as fully
to all intents and purposes as each of the undersigned might or could do in
person, the undersigned hereby ratifying and approving the acts of said
attorneys or any of them or of any such substitute pursuant hereto.
IN WITNESS WHEREOF, the undersigned have executed this instrument, all as
of the 9th day of October, 1995.
<TABLE>
<S> <C>
/s/ KEITH E. BAILEY /s/ JACK D. McCARTHY
------------------------------- -----------------------------
Keith E. Bailey Jack D. McCarthy
Chairman of the Board, President Senior Vice President
and Chief Executive Officer (Principal Financial Officer)
(Principal Executive Officer) and Director
/s/ GARY R. BELITZ /s/ JOHN C. BUMGARNER, JR.
------------------------------- -----------------------------
Gary R. Belitz John C. Bumgarner, Jr.
Controller Director
(Principal Accounting Officer)
/s/ STEPHEN L. CROPPER /s/ LLOYD A. HIGHTOWER
------------------------------- -----------------------------
Stephen L. Cropper Lloyd A. Hightower
Director Director
/s/ HENRY C. HIRSCH /s/ HOWARD E. JANZEN
------------------------------- -----------------------------
Henry C. Hirsch Howard E. Janzen
Director Director
</TABLE>
<PAGE> 2
WILLIAMS HOLDINGS OF DELAWARE, INC.
By /s/ JAMES R. HERBSTER
------------------------
James R. Herbster
Senior Vice President
ATTEST:
/s/ DAVID M. HIGBEE
---------------------
David M. Higbee
Secretary
<PAGE> 1
EXHIBIT 24.2
WILLIAMS HOLDINGS OF DELAWARE, INC.
I, the undersigned, DAVID M. HIGBEE, Secretary of WILLIAMS HOLDINGS OF
DELAWARE, INC., a Delaware corporation (hereinafter called the "Corporation"),
do hereby certify that pursuant to Section 141(f) of the General Corporation Law
of the State of Delaware, the Board of Directors of this Corporation unanimously
consented, as of October 10th, 1995, to the following:
RESOLVED that the officers of the Company be, and they hereby
are, authorized to execute and file with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, a
shelf Registration Statement on Form S-3, and all amendments and
supplements thereto and all required exhibits and documents in
connection therewith, and the Prospectus contained therein, and all
amendments or supplements thereto (the "Registration Statement"),
with respect to not more than four hundred million dollars
($400,000,000) aggregate principal amount of Debt Securities, and
to do, or cause to be done, all such other acts and things as, in
their opinion or in the opinion of any of them, may be necessary or
desirable and proper in order to effect such filing or in order
that such Registration Statement and any such amendment or
amendments may become effective and may remain in effect as long as
shall be required.
RESOLVED that the form of power of attorney circulated with
this Consent for use in connection with the execution and filing,
for and on behalf of the Company, of the Registration Statement and
any such amendments thereto referred to in the preceding
resolution, is hereby approved, and the Chairman of the Board, the
President or any Vice President of the Company is hereby authorized
to execute said power of attorney in the form so presented for and
on behalf of the Company.
RESOLVED that J. Furman Lewis, Senior Vice President and
General Counsel of The Williams Companies, Inc. be, and he hereby
is, designated as the person authorized to receive notices and
communications from the Securities and Exchange Commission with
respect to the Registration Statement and any amendments thereto
and that he be, and he hereby is, designated the agent for service
in connection with any and all matters relating to the Registration
Statement; and that there hereby is conferred upon him the powers
enumerated in Rule 478 of the Rules and Regulations promulgated
under the Securities Act of 1933, as amended.
I further certify that the foregoing resolutions have not been modified,
revoked or rescinded and are in full force and effect.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of
WILLIAMS HOLDINGS OF DELAWARE, INC., this 11th day of October, 1995.
/s/ DAVID M. HIGBEE
-----------------------
David M. Higbee
Secretary
(CORPORATE SEAL)
<PAGE> 1
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an application to determine eligibility of a Trustee pursuant to
Section 305(b)(2) _____
____________________
CITIBANK, N.A.
(Exact name of trustee as specified in its charter)
13-5266470
(I.R.S. employer
identification no.)
399 Park Avenue, New York, New York 10043
(Address of principal executive office) (Zip Code)
____________________
Williams Holdings of Delaware, Inc.
(Exact name of obligor as specified in its charter)
Delaware 73-1455707
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
One Williams Center
Tulsa, Oklahoma 74172
(Address of Principal Executive Offices) (Zip Code)
____________________
Senior Debt Securities
Subordinated Debt Securities
(Title of the indenture securities)
<PAGE> 2
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
<TABLE>
<CAPTION>
Name Address
---- -------
<S> <C>
Comptroller of the Currency, Washington, D.C.
Federal Reserve Bank of New York New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
Item 16. List of Exhibits.
Exhibit 1 - Copy of Articles of Association of the Trustee,
as now in effect. (Exhibit 1 to T-1 to Registration Statement
No. 2-79983)
Exhibit 2 - Copy of certificate of authority of the Trustee
to commence business.. (Exhibit 2 to T-1 to Registration
Statement No. 2-29577)
Exhibit 3 - Copy of authorization of the Trustee to exercise
corporate trust powers. (Exhibit 3 to T- 1 to Registration
Statement No. 2-55519)
Exhibit 4 - Copy of existing By-Laws of the Trustee.
(Exhibit 4 to T-1 to Registration Statement No. 33-34988)
Exhibit 5 - Not applicable.
Exhibit 6 - The consent of the Trustee required by Section
321(b) of the Trust Indenture Act of 1939. (Exhibit 6 to T-1
to Registration Statement No. 33-19227.)
2
<PAGE> 3
Exhibit 7 - Copy of the latest Report of Condition of
Citibank, N.A (as of June 30, 1995 -attached).
Exhibit 8 - Not applicable.
Exhibit 9 - Not applicable.
_________________________
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, Citibank, N.A., a national banking association organized and existing
under the laws of the United States of America, 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 11th day
of September, 1995.
CITIBANK, N.A.
By: s/Robert Kirchner
-----------------
Robert Kirchner
Vice President
3
<PAGE> 4
Charter No. 1461
Comptroller of the Currency
Northeastern District
REPORT OF CONDITION CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF
Citibank, N.A. of New York in the State of New York, at the close of business
on June 30, 1995, published in response to call made by Comptroller of the
Currency, under Title 12, United States Code, Section 161. Charter Number 1461
Comptroller of the Currency Northeastern District.
<TABLE>
<CAPTION>
ASSETS Thousands of dollars
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin . . . . . . . . . . . . . . . . . . . . . $ 7,397,000
Interest-bearing balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,242,000
Securities:
Held-to-maturity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,013,000
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,199,000
Federal funds sold and securities purchased under agreements to resell in domestic offices of the
bank and of its Edge and Agreement subsidiaries, and in IBFs:
Federal funds sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,468,000
Securities purchased under agreements to resell . . . . . . . . . . . . . . . . . . . . . . . 519,000
Loans and leases financing receivables:
Loans and leases, net of unearned income . . . . . . . . . . . . . . . . . . . . . . . . . $136,294,000
LESS: Allowance for loan and lease losses . . . . . . . . . . . . . . . . . . . . . . . . . . 4,401,000
Loans and leases, net of unearned income, allowance, and reserve . . . . . . . . . . . . . . 131,893,000
Trading assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,328,000
Premises and fixed assets (including capitalized leases) . . . . . . . . . . . . . . . . . . . . 3,463,000
Other real estate owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,299,000
Investments in unconsolidated subsidiaries and associated companies . . . . . . . . . . . . . . . 1,039,000
Customers liability to this bank on acceptances outstanding . . . . . . . . . . . . . . . . . . 1,408,000
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,000
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,825,000
------------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $217,107,000
============
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 33,302,000
Noninterest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11,799,000
Interest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,503,000
In foreign offices, Edge and Agreement subsidiaries, and IBFs . . . . . . . . . . . . . . . . 116,776,000
Noninterest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,429,000
Interest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108,347,000
Federal funds purchased and securities sold under agreements to repurchase in domestic offices
of the bank and of its Edge and Agreement subsidiaries, and in IBFs:
Federal funds purchased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,756,000
Securities sold under agreements to repurchase . . . . . . . . . . . . . . . . . . . . . . 675,000
Trading liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,079,000
Other borrowed money:
With original maturity of one year or less . . . . . . . . . . . . . . . . . . . . . . . . . 8,224,000
With original maturity of more than one year . . . . . . . . . . . . . . . . . . . . . . . . 4,321,000
Mortgage indebtedness and obligations under capitalized leases . . . . . . . . . . . . . . . . . 107,000
Bank s liability on acceptances executed and outstanding . . . . . . . . . . . . . . . . . . . . 1,418,000
Subordinated notes and debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,700,000
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,752,000
------------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $202,110,000
============
EQUITY CAPITAL
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 751,000
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,686,000
Undivided profits and capital reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,855,000
Net unrealized holding gains (losses) on available-for-sale securities . . . . . . . . . . . . . 246,000
Cumulative foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . . . . . (541,000)
-----------
TOTAL EQUITY CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 14,997,000
============
TOTAL LIABILITIES, LIMITED LIFE PREFERRED STOCK, AND EQUITY CAPITAL . . . . . . . . . . . . . . . $217,107,000
============
</TABLE>
I, Roger W. Trupin, Controller of the abovenamed bank do hereby declare that
this Report of Condition is true and correct to the best of my knowledge and
belief.
ROGER W. TRUPIN We, the undersigned directors, attest to the correctness of
this Report of Condition. We 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 and is true and correct.
PAUL J. COLLINS
CHRISTOPHER J. STEFFEN
WILLIAM R. RHODES
Directors
