EXHIBIT 4-K
-----------
PREFERRED SECURITIES GUARANTEE AGREEMENT
====================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
PACIFIC TELESIS FINANCING { }
Dated as of __________, 1995
====================================
1
CROSS REFERENCE TABLE*
Section of Section of
Trust Indenture Act Guarantee
of 1939, as amended Agreement
310(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(a)
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1(a)
310(c) . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(c) . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
312(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.8
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
313(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
313(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
313(d) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
314(b) . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
314(d) . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
314(f) . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d); 3.2(a)
315(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7(a)
315(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(c)
315(d) . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1(d)
315(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7(c)
316(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.6
316(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4(c)
316(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.6
317(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.10; 5.4
317(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7(b)
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1(b)
_________________________
* This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not have any bearing upon the interpretation of any
of its terms or provisions.
2
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT ("Guarantee Agreement"), dated as of _____________,
1995, is executed and delivered by Pacific Telesis Group, a Nevada
corporation (the "Guarantor"), and The First National Bank of Chicago, a
national banking association, as trustee (the "Preferred Guarantee Trustee"
as more fully defined herein)), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
Pacific Telesis Financing { }, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of __________, among the trustees of the Issuer
named therein, the Guarantor as sponsor and the Holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer is
issuing on the date hereof $__________ aggregate stated liquidation amount
of Preferred Securities designated the ____% Trust Originated Preferred
Securities (the "Preferred Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred Securities,
the Guarantor desires irrevocably and unconditionally to agree, to the
extent set forth in this Guarantee Agreement, to pay to the Holders of the
Preferred Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a guarantee
agreement (the "Common Securities Guarantee Agreement") in substantially
identical terms to this Guarantee Agreement for the benefit of the holders
of the Common Securities (as defined herein) except that if an Event of
Default (as defined in the Indenture (as defined herein)), has occurred and
is continuing, the rights of holders of the Common Securities to receive
Guarantee Payments under the Common Securities Guarantee are subordinated to
the rights of Holders of Preferred Securities to receive Guarantee Payments
under this Guarantee Agreement.
NOW, THEREFORE, in consideration of the purchase by each Holder of Preferred
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Guarantee Agreement, unless the context otherwise requires:
(a) Capitalized terms used in this Guarantee Agreement but not defined
in the preamble above have the respective meanings assigned to them
in this Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented
or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended, or any successor rule thereunder.
3
"Authorized Officer" of a Person (as defined herein) means any Person that
is authorized to bind such Person.
"Business Day" means any day other than a day on which banking institutions
in New York, New York or Chicago, Illinois are authorized or required by law
to close.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Direction" by a Person means a written direction signed:
(a) if the Person is a natural person, by that Person; or
(b) in any other case in the name of such Person by one or more
Authorized Officers of that Person.
"Distribution" means the periodic distribution and other payments payable to
Holders of Preferred Securities in accordance with the terms of the
Preferred Securities set forth in Exhibit A to the Declaration.
"Guarantee Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Guarantee Agreement.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Issuer: (i) any accrued and unpaid Distributions that
are required to be paid on such Preferred Securities to the extent the
Issuer shall have funds available therefor, (ii) the redemption price,
including all accrued and unpaid Distributions to the date of redemption
(the "Redemption Price")to the extent the Issuer has funds available
therefor, with respect to any Preferred Securities called for redemption by
the Issuer, and (iii) upon a voluntary or involuntary dissolution, winding-
up or termination of the Issuer (other than in connection with the
distribution of Subordinated Debentures (as defined herein) to the Holders
in exchange for Preferred Securities as provided in the Declaration or the
redemption of all the Preferred Securities upon the maturity or redemption
of the Subordinated Debentures), the lesser of (a) the aggregate of the
liquidation amount and all accrued and unpaid Distributions on the Preferred
Securities to the date of payment, and (b) the amount of assets of the
Issuer remaining available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution"). If an Event of
Default under the Indenture has occurred and is continuing, the rights of
holders of the Common Securities to receive payments under the Common
Securities Guarantee Agreement are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments.
"Holder" shall mean any registered owner shown on the register of the Issuer
of any Preferred Securities; provided however, that in determining whether
the holders of the requisite percentage of Preferred Securities have given
any request, notice, consent or waiver hereunder, "Holder" shall not include
the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Preferred Guarantee Trustee, any Affiliate of
the Preferred Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives or agents of the Preferred
Guarantee Trustee.
"Indenture" means the Indenture dated as of ___________, 1995, as
supplemented by the First Supplemental Indenture dated as of ___________,
1995 (the "First Supplemental Indenture"), each being among Pacific Telesis
Group as issuer (the "Subordinated Debenture Issuer") and The First National
Bank of Chicago, as trustee and any indenture supplemental thereto pursuant
to which certain subordinated debt securities of the Subordinated Debenture
Issuer are to be issued to the Property Trustee (as defined in the
Declaration) of the Issuer.
"Majority in liquidation amount of the Preferred Securities" means, except
as provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of more than 50% of the
liquidation amount (including the stated amount that would be paid on
4
redemption, liquidation or otherwise, plus accrued and unpaid Distributions
to the date upon which the voting percentages are determined) of all
Preferred Securities. In determining whether the Holders of the requisite
amount of Preferred Securities have voted, Preferred Securities which are
owned by the Guarantor or any Affiliate of the Guarantor or any other
obligor on the Preferred Securities shall be disregarded for the purpose of
any such determination.
"Officer's Certificate" means, with respect to any Person, a certificate
signed by an Authorized Officer of such Person. Any Officer's Certificate
delivered with respect to compliance with a condition or covenant provided
for in this Guarantee Agreement shall include:
(a) a statement that such officer signing the Officer's Certificate has
read the covenant or condition and the definition relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation on which the statements or opinions contained in such
Officer's Certificate are based;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company,
limited liability company, trust, unincorporated association, or government
or any agency, authority or political subdivision thereof.
"Preferred Guarantee Trustee" means The First National Bank of Chicago until
a Successor Preferred Guarantee Trustee (as defined herein) has been
appointed and has accepted such appointment pursuant to the terms of this
Guarantee Agreement and thereafter means each such Successor Preferred
Guarantee Trustee.
"Responsible Officer" means, with respect to the Preferred Guarantee
Trustee, any vice-president, any assistant vice-president, the secretary,
any assistant secretary, the treasurer, any assistant treasurer, any trust
officer or assistant trust officer or any other officer of the corporate
trust department of the Preferred Guarantee Trustee customarily performing
functions similar to those performed by any of the above designated officers
and also means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of that officer's
knowledge of and familiarity with the particular subject.
"66 2/3% in liquidation amount of the Preferred Securities" means, except as
provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of 66 2/3% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation or otherwise, plus accrued and unpaid Distributions to the date
upon which the voting percentages are determined) of all Preferred
Securities. In determining whether the Holders of the requisite amount of
Preferred Securities have voted, Preferred Securities which are owned by the
Guarantor or any Affiliate of the Guarantor or any other obligor on the
Preferred Securities shall be disregarded for the purpose of any such
determination.
"Subordinated Debentures" means the series of subordinated debt securities
of the Guarantor designated the ___% Subordinated Deferrable Interest
Debentures due ____ held by the Property Trustee.
"Subsidiary" means any corporation of which at the time of determination the
Guarantor, directly and/or indirectly through one or more Subsidiaries owns
more than 50% of the shares of the voting stock of such corporation.
"Successor Preferred Guarantee Trustee" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred
Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended to
the date of this Guarantee Agreement.
5
6
"25% in liquidation amount of the Preferred Securities" means, except as
provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting separately as a class, of 25% of the liquidation amount
(including the stated amount that would be paid on redemption, liquidation
or otherwise, plus accrued and unpaid Distributions to the date upon which
the voting percentages are determined) of all Preferred Securities. In
determining whether the Holders of the requisite amount of Preferred
Securities have voted, Preferred Securities which are owned by the Guarantor
or any Affiliate of the Guarantor or any other obligor on the Preferred
Securities shall be disregarded for the purpose of any such determination.
SECTION 1.2 Other Defined Terms
Capitalized terms not otherwise defined in this Guarantee Agreement shall
have the meaning ascribed to them in the Declaration.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this
Guarantee Agreement and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities.
(a) The Guarantor will furnish or cause to be furnished to the
Preferred Guarantee Trustee, not less than 45 days nor more
than 60 days after each date (month and day) that is a
Distribution payment date under the Declaration, but in no
event less frequently than semiannually, and at such other
times as the Preferred Guarantee Trustee may request in
writing, within 30 days after receipt by the Guarantor of any
such request, a list in such form as the Preferred Guarantee
Trustee may reasonably require containing all the information
in the possession or control of the Guarantor as to the names
and addressees of the Holders of Preferred Securities obtained
since the date as of which the next previous list, if any, was
furnished. Any such list may be dated as of a date not more
than 15 days prior to the time such information is furnished
and need not include information received after such date.
(b) The Preferred Guarantee Trustee shall comply with its
obligations under Section 311(a), 311(b) and Section 312(b) of
the Trust Indenture Act.
SECTION 2.3 Reports by the Preferred Guarantee Trustee.
Within 60 days after May 15 of each year, the Preferred Guarantee Trustee
shall provide to the Holders of the Preferred Securities such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The
Preferred Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Preferred Guarantee Trustee.
The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information as required by Section 314 (if any) and
the compliance certificate required by Section 314 of the Trust Indenture
Act in the form, in the manner and at the times required by Section 314 of
the Trust Indenture Act.
7
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Preferred Guarantee Trustee such evidence
of compliance with any conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to
be given by an officer pursuant to Section 314(c)(1) may be given in the
form of an Officer's Certificate.
SECTION 2.6 Guarantee Events of Default; Waiver.
The Holders of a Majority in liquidation amount of the Preferred Securities
may, by vote, on behalf of the Holders of all of the Preferred Securities,
waive any past Guarantee Event of Default and its consequences. Upon such
waiver, any such Guarantee Event of Default shall cease to exist, and any
Guarantee Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Guarantee Agreement, but no such waiver
shall extend to any subsequent or other default or Guarantee Event of
Default or impair any right consequent thereon. The Guarantor may set a
special record date for purposes of determining the identity of the Holders
of the Preferred Securities entitled to vote or consent to any action by
vote or consent authorized or permitted by this Section 2.6. Such record
date shall be the later of 15 days prior to the first solicitation of such
consent or the date of the most recent list of Holders furnished to the
Preferred Guarantee Trustee pursuant to Section 2.2 of this Guarantee
Agreement prior to such solicitation.
SECTION 2.7 Guarantee Event of Default Notice.
(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of a Guarantee Event of Default, transmit by mail,
first class postage prepaid, to the Holders of the Preferred
Securities, notices of all Guarantee Events of Default known to
the Preferred Guarantee Trustee, unless such defaults have been
cured before the giving of such notice, provided that the
Preferred Guarantee Trustee shall be protected in withholding
such notice if and so long as the board of directors, the
executive committee, or a trust committee of directors and/or
Responsible Officers of the Preferred Guarantee Trustee in good
faith determines that the withholding of such notice is in the
interests of the Holders of the Preferred Securities.
(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Guarantee Event of Default unless the
Preferred Guarantee Trustee shall have received written notice,
or a Responsible Officer charged with the administration of the
Declaration shall have obtained written notice, of such
Guarantee Event of Default.
(c) The provisions of Section 315(e) of the Trust Indenture Act
shall be excluded from this Guarantee Agreement.
SECTION 2.8 Disclosure of Information.
The disclosure of information as to the names and addresses of the Holders
of the Preferred Securities in accordance with Section 312 of the Trust
Indenture Act, regardless of the source from which such information was
derived, shall not be deemed to be a violation of any existing law, or any
law hereafter enacted which does not specifically refer to Section 312 of
the Trust Indenture Act, nor shall the Guarantee Trustee be held accountable
by reason of mailing any material pursuant to a request made under Section
312(b) of the Trust Indenture Act.
SECTION 2.9 Conflicting Interests.
The Preferred Securities Guarantee Agreements for the benefit of the Holders
of the Preferred Securities of each of Pacific Telesis Financing
{ } and { } shall be deemed to be specifically described in this Guarantee
Agreement for the purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
8
SECTION 2.10 Preferred Guarantee Trustee May File Proofs of Claim.
Upon the occurrence of a Guarantee Event of Default, the Preferred Guarantee
Trustee is hereby authorized to (a) recover judgment, in its own name and as
trustee of an express trust, against the Guarantor for the whole amount of
any Guarantee payments remaining unpaid and (b) file such proofs of claim
and other papers or documents as may be necessary or advisable in order to
have its claims and those of the Holders of the Preferred Securities allowed
in any judicial proceedings relative to the Guarantor, its creditors or its
property.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Preferred Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Preferred
Guarantee Trustee for the benefit of the Holders of the
Preferred Securities, and the Preferred Guarantee Trustee shall
not transfer this Guarantee Agreement to any Person except a
Holder of Preferred Securities exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Preferred
Guarantee Trustee on acceptance by such Successor Preferred
Guarantee Trustee of its appointment to act as Successor
Preferred Guarantee Trustee. The right, title and interest of
the Preferred Guarantee Trustee shall automatically vest in any
Successor Preferred Guarantee Trustee, and such vesting and
cessation of title shall be effective whether or not
conveyancing documents have been executed and delivered
pursuant to the appointment of such Successor Preferred
Guarantee Trustee.
(b) If a Guarantee Event of Default has occurred and is continuing,
the Preferred Guarantee Trustee shall enforce this Guarantee
Agreement for the benefit of the Holders of the Preferred
Securities.
(c) The Preferred Guarantee Trustee, before the occurrence of any
Guarantee Event of Default and after the curing of all
Guarantee Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants
shall be read into this Guarantee Agreement against the
Preferred Guarantee Trustee. In case a Guarantee Event of
Default has occurred (that has not been cured or waived
pursuant to Section 2.6), the Preferred Guarantee Trustee shall
exercise such of the rights and powers vested in it by this
Guarantee Agreement, and use the same degree of care and skill
in its exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own
affairs.
(d) No provision of this Guarantee Agreement shall be construed to
relieve the Preferred Guarantee Trustee from liability for its
own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Guarantee Event of Default and
after the curing or waiving of all such Guarantee Events of
Default that may have occurred:
(A) the duties and obligations of the Preferred Guarantee
Trustee shall be determined solely by the express
provisions of this Guarantee Agreement, and the Preferred
Guarantee Trustee shall not be liable except for the
performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement, and no
implied covenants or obligations shall be read into this
Guarantee Agreement against the Preferred Guarantee
Trustee; and
(B) in the absence of bad faith on the part of the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee may
9
conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon
any certificates or opinions furnished to the Preferred
Guarantee Trustee and conforming to the requirements of
this Guarantee Agreement; but in the case of any such
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Preferred
Guarantee Trustee, the Preferred Guarantee Trustee shall
be under a duty to examine the same to determine whether
or not they conform to the requirements of this Guarantee
Agreement;
(ii) the Preferred Guaranty Trustee shall not be
liable for any error of judgment made in good
faith by a Responsible Officer of the Preferred
Guarantee Trustee, unless it shall be proved
that the Preferred Guarantee Trustee was
negligent in ascertaining the pertinent facts
upon which such judgment was made;
(iii) the Preferred Guarantee Trustee shall not be
liable with respect to any action taken or
omitted to be taken by it in good faith in
accordance with the direction of the Holders of
not less than a Majority in liquidation amount
of the Preferred Securities relating to the
time, method and place of conducting any
proceeding for any remedy available to the
Preferred Guarantee Trustee, or exercising any
trust or power conferred upon the Preferred
Guarantee Trustee under this Guarantee
Agreement; and
(iv) no provision of this Guarantee Agreement shall
require the Preferred Guarantee Trustee to
expend or risk its own funds or otherwise incur
personal financial liability in the performance
of any of its duties or in the exercise of any
of its rights or powers, if the Preferred
Guarantee Trustee shall have reasonable grounds
for believing that the repayment of such funds
or liability is not reasonably assured to it
under the terms of this Guarantee Agreement or
adequate indemnity against such risk or
liability is not reasonably assured to it.
(e) The Preferred Guarantee Trustee may authorize one or more persons
(each a "Paying Agent") to pay Guarantee Payments and any such
Paying Agent shall comply with Section 317(b) of the Trust
Indenture Act. Any Paying Agent may be removed by the Preferred
Guarantee Trustee at any time and a successor Paying Agent or
additional Paying Agents may be appointed at any time by the
Preferred Guarantee Trustee.
SECTION 3.2 Certain Rights of Preferred Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Preferred Guarantee Trustee may rely and shall be
fully protected in acting or refraining from acting upon
any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to
be genuine and to have been signed, sent or presented by
the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this
Guarantee Agreement shall be sufficiently evidenced by a
Direction or an Officer's Certificate.
(iii) Whenever, in the administration of this Guarantee
Agreement, the Preferred Guarantee Trustee shall deem it
desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the
10
Preferred Guarantee Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad
faith on its part, request and rely upon an Officer's
Certificate which, upon receipt of such request, shall be
promptly delivered by the Guarantor.
(iv) The Preferred Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument
(or any rerecording, refiling or registration thereof).
(v) The Preferred Guarantee Trustee may consult with counsel,
and the written advice or opinion of such counsel with
respect to legal matters shall be full and complete
authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith
and in accordance with such advice or opinion. Such
counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees. The
Preferred Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of
this Guarantee Agreement from any court of competent
jurisdiction.
(vi) The Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested
in it by this Guarantee Agreement at the request or
direction of any Holder, unless such Holder shall have
provided to the Preferred Guarantee Trustee such adequate
security and indemnity as would satisfy a reasonable
person in the position of the Preferred Guarantee Trustee,
against the costs, expenses (including attorneys' fees and
expenses) and liabilities that might be incurred by it in
complying with such request or direction, including such
reasonable advances as may be requested by the Preferred
Guarantee Trustee; provided that, nothing contained in
this Section 3.2(a)(vi) shall be taken to relieve the
Preferred Guarantee Trustee, upon the occurrence of a
Guarantee Event of Default, of its obligation to exercise
the rights and powers vested in it by this Guarantee
Agreement.
(vii) The Preferred Guarantee Trustee shall not be bound to make
any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other
paper or document, but the Preferred Guarantee Trustee, in
its discretion, may make such further inquiry or
investigation into such facts or matters as it may see
fit.
(viii) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys, and
the Preferred Guarantee Trustee shall not be responsible
for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it hereunder.
(ix) Any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Holders of the Preferred
Securities, and the signature of the Preferred Guarantee
Trustee or its agents alone shall be sufficient and
effective to perform any such action. No third party
shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act or as to its
compliance with any of the terms and provisions of this
Guarantee Agreement, both of which shall be conclusively
evidenced by the Preferred Guarantee Trustee's or its
agent's taking such action.
(x) Whenever in the administration of this Guarantee Agreement
the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy
or right or taking any other action hereunder, the
Preferred Guarantee Trustee (i) may request instructions
from the Holders of a Majority in liquidation amount of
11
the Preferred Securities, (ii) may refrain from enforcing
such remedy or right or taking such other action until
such instructions are received, and (iii) shall be
protected in acting in accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose
any duty or obligation on the Preferred Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or
obligation conferred or imposed on it in any jurisdiction in which
it shall be illegal, or in which the Preferred Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable
law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or
authority available to the Preferred Guarantee Trustee shall be
construed to be a duty.
(c) The Guarantor assumes responsibility for being and remaining
informed of the financial condition of the Subordinated Debenture
Issuer and of all other circumstances bearing upon the risk of
non-payment of amounts owing under the Preferred Securities which
diligent inquiry would reveal and agrees that the Holders of the
Preferred Securities shall have no duty to advise the Guarantor of
information known to any of them regarding such condition or any
such circumstances.
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee
Agreement.
The recitals contained in this Guarantee Agreement shall be taken as the
statements of the Guarantor, and the Preferred Guarantee Trustee does not
assume any responsibility for their correctness. The Preferred Guarantee
Trustee makes no representation as to the validity or sufficiency of this
Guarantee Agreement.
ARTICLE IV
PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 Preferred Guarantee Trustee; Eligibility.
(a) There shall at all times be a Preferred Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws
of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or
Person permitted by the Securities and Exchange Commission to
act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least
$50,000,000, and subject to supervision or examination by
Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of
condition at least annually pursuant to law or to the
requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section
4.1(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition
so published.
(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee
Trustee shall immediately resign in the manner and with the effect
set out in Section 4.2(c).
(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Preferred Guarantee Trustee and Guarantor
shall in all respects comply with the provisions of Section 310(b)
of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Preferred Guarantee
12
Trustees.
(a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.
(b) The Preferred Guarantee Trustee shall not be removed in accordance
with Section 4.2(a) until a Successor Preferred Guarantee Trustee
has been appointed and has accepted such appointment by written
instrument executed by such Successor Preferred Guarantee Trustee
and delivered to the Guarantor.
(c) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have
been appointed or until its removal or resignation. The Preferred
Guarantee Trustee may resign from office (without need for prior
or subsequent accounting) by an instrument in writing executed by
the Preferred Guarantee Trustee and delivered to the Guarantor,
which resignation shall not take effect until a Successor
Preferred Guarantee Trustee has been appointed and has accepted
such appointment by instrument in writing executed by such
Successor Preferred Guarantee Trustee and delivered to the
Guarantor and the resigning Preferred Guarantee Trustee.
(d) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery to the Guarantor of an instrument of
resignation, the resigning Preferred Guarantee Trustee may
petition any court of competent jurisdiction for appointment of a
Successor Preferred Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper,
appoint a Successor Preferred Guarantee Trustee.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense, right of
set-off or counterclaim that the Issuer may have or assert. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of
the required amounts by the Guarantor to the Holders or by causing the
Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this Guarantee Agreement
and of any liability to which it applies or may apply, presentment, demand
for payment, any right to require a proceeding first against the Issuer or
any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices
and demands.
SECTION 5.3 Unconditional Nature of Obligations.
The obligations of the Guarantor under this Guarantee Agreement shall be
absolute and unconditional and shall remain in full force and effect until
the entire liquidation amount of all outstanding Preferred Securities shall
have been paid and such obligation shall not be affected, modified or
impaired upon the happening from time to time of any event, including
without limitation any of the following, whether or not with notice to, or
the consent of, the Guarantor:
(a) the waiver, surrender, compromise, settlement, release or
termination of any or all of the obligations, covenants or
agreements of the Issuer under the Preferred Securities;
(b) the failure to give notice to the Guarantor of the occurrence
of a default under the Preferred Securities;
(c) the waiver, compromise or release of the payment, performance
or observance by the Issuer or by the Guarantor, respectively,
of any or all of the obligations, covenants or agreements
contained in the case of the Issuer, in the Preferred
13
Securities, and, in the case of the Guarantor, in this
Guarantee Agreement;
(d) the extension of the time for payment of the liquidation amount
of any Preferred Securities or of the time for performance of
any other obligations, covenants or agreements under or arising
out of the Preferred Securities;
(e) the modification or amendment (whether material or otherwise)
of any obligation, covenant or agreement set forth in the
Preferred Securities;
(f) any failure, omission, delay or lack on the part of any Holder
to enforce, assert or exercise any right, power or remedy
conferred on it in or in connection with the Preferred
Securities;
(g) the voluntary or involuntary liquidation, dissolution, sale or
other disposition of all or substantially all the assets,
marshalling of assets and liabilities, receivership,
insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition with
creditors or readjustment of, or other similar proceedings
affecting the Guarantor or the Issuer or any of the respective
assets of either of them, or any allegation or contest of the
validity of this Guarantee Agreement in any such proceeding;
(h) any defense based upon any legal disability of the Issuer or,
to the extent permitted by law, any release, discharge,
reduction or limitation of or with respect of any sums owing by
the Issuer or any other liability of the Issuer to any Holder;
(i) to the extent permitted by law, the release or discharge by
operation of law of the Guarantor from the performance or
observance of any obligation, covenant or agreement contained
in this Guarantee Agreement;
(j) the default or failure of the Guarantor fully to perform any of
its obligations set forth in this Guarantee Agreement; or
(k) the invalidity of the Preferred Securities or any defense which
the Issuer may have against any Holder.
If any payment by the Issuer to any Holder is rescinded or must be returned
by such Holder, the obligations of the Guarantor hereunder shall be
reinstated with respect of such payment.
No set-off, counterclaim, reduction, or diminution of any obligation, or any
defense of any kind or nature which the Guarantor has or may have against
any Holder shall be available hereunder to the Guarantor against such Holder
to reduce the payments to it under this Guarantee Agreement.
The Guarantor assumes responsibility for being and remaining informed of the
financial condition of the Issuer and of all other circumstances bearing
upon the risk of nonpayment of amounts owing under the Preferred Securities
which diligent inquiry would reveal and agrees that no Holder shall have any
duty to advise the Guarantor of information known to it regarding such
condition or any such circumstances.
SECTION 5.4 Rights of Holders.
(a) The Holders of a Majority in liquidation amount of the
Preferred Securities have the right to direct the time, method
and place of conducting of any proceeding for any remedy
available to the Preferred Guarantee Trustee in respect of this
Guarantee Agreement or exercising any trust or power conferred
upon the Preferred Guarantee Trustee under this Guarantee
Agreement.
(b) If the Preferred Guarantee Trustee fails to enforce this
Guarantee Agreement, any Holder of Preferred Securities may
institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without
first instituting a legal proceeding against the Issuer, the
Preferred Guarantee Trustee or any other Person.
14
(c) Notwithstanding any other provisions in this Guarantee
Agreement, the right of any Holder of any Preferred Security to
receive payment of the Guarantee Payments when due or to
institute suit for the enforcement of any such payment on or
after such respective dates shall not be impaired or affected
without the consent of such Holder.
(d) Notwithstanding any other provision in this Guarantee
Agreement, the Holder of any Preferred Security shall have the
right, which is absolute and unconditional, to receive payment
of Guarantee Payments when due and to institute suit for the
enforcement of any such payments, and such rights shall not be
impaired without the consent of such Holder.
SECTION 5.5 Enforcement of Guarantee.
The Guarantor and the Preferred Guarantee Trustee expressly acknowledge that
(i) this Guarantee Agreement will be deposited with the Preferred Guarantee
Trustee to be held for the benefit of the Holders; (ii) the Preferred
Guarantee Trustee has the right to enforce this Guarantee Agreement on
behalf of the Holders; (iii) Holders representing not less than a Majority
in liquidation amount of the Preferred Securities have the right to direct
the time, method and place of conducting any proceeding for any remedy
available in respect of this Guarantee Agreement including the giving of
directions to the Preferred Guarantee Trustee, or exercising any trust or
other power conferred upon the Preferred Guarantee Trustee under this
Guarantee Agreement, and (iv) if the Preferred Guarantee Trustee fails to
enforce this Guarantee Agreement, any Holder of Preferred Securities may
institute a legal proceeding directly against the Guarantor to enforce its
rights under this Guarantee Agreement, without first instituting a legal
proceeding against the Issuer, the Preferred Guarantee Trustee, or any other
Person; all as provided in this Guarantee Agreement.
SECTION 5.6 Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not of
collection.
SECTION 5.7 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Preferred Securities against the Issuer in respect of any amounts paid to
such Holders by the Guarantor under this Guarantee Agreement; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and
unpaid under this Guarantee Agreement. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, the Guarantor agrees to
hold such amount in trust for the Holders and to pay over such amount to the
Holders. The Guarantor shall not exercise its right of subrogation if such
exercise would adversely affect the rights of Holders of any outstanding
Preferred Securities.
SECTION 5.8 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are independent of
the obligations of the Issuer with respect to the Preferred Securities, and
that the Guarantor shall be liable hereunder to make Guarantee Payments
pursuant to the terms of this Guarantee Agreement notwithstanding the
occurrence of any event referred to in subsections (a) through (k),
inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Preferred Securities remain outstanding, if there shall have
occurred a Guarantee Event of Default or an event of default under the
Declaration or if the Subordinated Debenture Issuer shall have selected an
Extended Interest Payment Period (as defined in the First Supplemental
Indenture), then (a) the Guarantor shall not declare or pay any dividend on,
15
or make any distributions with respect to, or redeem, purchase, or acquire
or make a liquidation payment with respect to, any of its capital stock and
(b) the Guarantor shall not make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any debt securities
issued by the Guarantor which rank pari passu with or junior to this
Guarantee Agreement, and (c) the Guarantor shall not make any guarantee
payments with respect to the foregoing (other than pursuant to this
Guarantee Agreement); provided, that, the foregoing restriction in Section
6.1 (a) shall not apply to any stock dividends paid by the Guarantor where
the dividend stock is the same stock as that on which the dividend is being
paid. In addition, so long as any Preferred Securities remain outstanding,
the Guarantor (i) will remain the sole direct or indirect owner of all of
the outstanding Common Securities and shall not cause or permit the Common
Securities to be transferred except to the extent such transfer is permitted
under Section 9.1(c) of the Declaration; provided that any permitted
successor of the Guarantor under the Indenture may succeed to the
Guarantor's ownership of the Common Securities and (ii) will not take any
action which would cause the Issuer to be treated as other than grantor
trust for United States federal income tax purposes except in connection
with a distribution of Subordinated Debentures as provided in the
Declaration.
SECTION 6.2 Ranking.
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank (i) subordinate and junior in right of payment to
all other liabilities of the Guarantor except those made pari passu or
subordinate by their terms, (ii) pari passu with the most senior preferred
or preference stock now or hereafter issued by the Guarantor and with any
guarantee now or hereafter entered into by the Guarantor in respect of any
preferred or preference stock of any Affiliate of the Guarantor, and (iii)
senior to the Guarantor's common stock.
If an Event of Default has occurred and is continuing under the Indenture,
the rights of the holders of the Common Securities to receive any payments
under the Common Securities Guarantee Agreement shall be subordinated to the
rights of the Holders of Preferred Securities to receive Guarantee Payments
hereunder.
SECTION 6.3 Guarantor Existence.
The Guarantor shall not consolidate with or merge into any other corporation
or convey, transfer or lease, or permit one or more of its Subsidiaries to
convey, transfer or lease, all or substantially all of the property and
assets of the Guarantor and its Subsidiaries on a consolidated basis, to any
Person, unless the corporation formed by such consolidation or into which
the Guarantor is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Guarantor and
its Subsidiaries on a consolidated basis (i) is a corporation organized
under the laws of the United States, any state of the United States or the
District of Columbia, (ii) such surviving corporation shall expressly assume
the Guarantor's obligations hereunder and (iii) immediately after giving
effect to the transaction no Event of Default shall have occurred and be
continuing.
This Section shall only apply to a merger or consolidation in which the
Guarantor is not the surviving corporation and to conveyances, leases and
transfers by the Guarantor as transferor or lessor.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.
This Guarantee Agreement shall terminate upon the earliest of (i) full
payment of the Redemption Price of all Securities, (ii) the distribution of
the Subordinated Debentures to the Holder's of all of the Preferred
Securities or (iii) full payment of the amounts payable in accordance with
the Declaration upon liquidation of the Issuer. Notwithstanding the
foregoing, this Guarantee Agreement will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of Preferred
Securities must restore payment of any sums paid under the Preferred
Securities or under this Preferred Securities Guarantee.
16
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage or claim incurred by reason
of any act or omission performed or omitted by such Indemnified
Person in good faith in accordance with this Guarantee
Agreement and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Guarantee
Agreement or by law, except that an Indemnified Person shall be
liable for any such loss, damage or claim incurred by reason of
such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Guarantor and upon such
information, opinions, reports or statements presented to the
Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional
or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of
the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which
Distributions to Holders of Preferred Securities might properly
be paid.
SECTION 8.2 Indemnification.
(a) To the fullest extent permitted by applicable law, the
Guarantor shall indemnify and hold harmless each Indemnified
Person from and against any loss, damage or claim incurred by
such Indemnified Person by reason of any act or omission
performed or omitted by such Indemnified Person in good faith
in accordance with this Guarantee Agreement and in a manner
such Indemnified Person reasonably believed to be within the
scope of authority conferred on such Indemnified Person by this
Guarantee Agreement, except that no Indemnified Person shall be
entitled to be indemnified in respect of any loss, damage or
claim incurred by such Indemnified Person by reason of such
Indemnified Person s negligence or willful misconduct with
respect to such acts or omissions.
(b) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by an Indemnified Person in
defending any claim, demand, action, suit or proceeding shall,
from time to time, be advanced by the Guarantor prior to the
final disposition of such claim, demand, action, suit or
proceeding upon receipt by the Guarantor of an undertaking by
or on behalf of the Indemnified Person to repay such amount if
it shall be determined that the Indemnified Person is not
entitled to be indemnified as authorized in Section 8.2(a).
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Guarantee Agreement shall
bind the successors, assigns, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Holders of the Preferred
Securities then outstanding.
SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely affect the rights
of Holders (in which case no consent of Holders will be required), this
Guarantee Agreement may only be amended with the prior approval of the
17
Holders of at least 66-2/3% in liquidation amount of the Preferred
Securities. The provisions of Section 12.2 of the Declaration with respect
to meetings of Holders of the Securities apply to the giving of such
approval.
18
SECTION 9.3 Notices.
All notices provided for in this Guarantee Agreement shall be in writing,
duly signed by the party giving such notice, and shall be electronically
communicated or hand delivered or sent by overnight courier, as follows:
(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such
other address as the Preferred Guarantee Trustee may give
notice of to the Holders of the Preferred Securities):
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
(b) If given to the Guarantor, at the Guarantor's mailing address
set forth below (or such other address as the Guarantor may
give notice of to the Holders of the Preferred Securities):
Pacific Telesis Group
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
(c) If given to any Holder of Preferred Securities, at the address
set forth on the books and records of the Issuer.
For all purposes of this Guarantee Agreement, a notice or communication will
be deemed effective:
(a) if delivered by hand or sent by overnight courier, on the day
it is delivered unless (i) that day is not a Business Day in
the city specified (a Local Business Day") in the address for
notice provided by the recipient or (ii) if delivered after the
close of business on a Local Business Day, then on the next
succeeding Local Business Day, or
(b) if sent by facsimile transmission, on the date transmitted,
provided that oral or written confirmation of receipt is
obtained by the sender unless the date of transmission and
confirmation is not a Local Business Day, in which case, on the
next succeeding Local Business Day.
Any notice, direction, request, demand, consent or waiver by the
Subordinated Debenture Issuer or any Holder of Securities to or upon the
Preferred Guarantee Trustee shall be deemed to have been sufficiently given,
made or filed, for all purposes, if given, made or filed in writing at the
principal office of the Preferred Guarantee Trustee in accordance with the
provisions of this Section 9.3.
SECTION 9.4 Benefit.
This Guarantee Agreement is solely for the benefit of the Holders of the
Preferred Securities and, subject to Section 3.1(a), is not separately
transferable from the Preferred Securities.
SECTION 9.5 Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
Pacific Telesis Group
By:_______________________________
Name:_____________________________
Title:____________________________
19
The First National Bank of Chicago
as Preferred Guarantee Trustee
By:_______________________________
Name:_____________________________
Title:____________________________
20
