EXHIBIT 4.1
TECO ENERGY, INC.
and
THE BANK OF NEW YORK
As Trustee
____________
FIRST SUPPLEMENTAL INDENTURE
dated as of September 1, 1998
Supplementing the Indenture
dated as of August 17, 1998
____________
$150,000,000
Remarketed Notes Due 2038
TABLE OF CONTENTS PAGE
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION . . . . . . . . . . . . . . . . . . . . . . 2
Section 101 Definitions . . . . . . . . . . . . . . . . . . 2
Section 102 Section References. . . . . . . . . . . . . . . 8
ARTICLE TWO DESIGNATION AND TERMS OF THE NOTES. . . . . . . . . . . 8
Section 201 Establishment of Series . . . . . . . . . . . . 8
Section 202 Variations in Terms of Notes. . . . . . . . . . 8
Section 203 Amount and Denominations; the Depositary. . . . 9
Section 204 Interest Rates, Interest Payment Dates and
Interest Rate Periods. . . . . . . . . . . . . . . . 9
Section 205 Determination of Interest Rates . . . . . . . .11
Section 206 Election and Determination of a Floating
Interest Rate by the Company . . . . . . . . . . . .12
Section 207 Conversion Between Interest Rate Modes by
the Company . . . . . . . . . . . . . . . . . . . . . .19
Section 208 Automatic Tender of Notes on the Interest
Rate Adjustment Date. . . . . . . . . . . . . . . . . .21
Section 209 Remarketing . . . . . . . . . . . . . . . . . .21
Section 210 Purchase and Redemption of Notes. . . . . . . .23
Section 211 Form and Other Terms of the Notes . . . . . . .24
ARTICLE THREE THE REPS MODE . . . . . . . . . . . . . . . . . . . . .25
Section 301 Applicability of Article. . . . . . . . . . . .25
Section 302 Initial REPS Rate Period. . . . . . . . . . . .25
Section 303 Interest to REPS Remarketing Date . . . . . . .25
Section 304 Tender to and Remarketing by the
Callholder . . 25
Section 305 Conversion or Redemption Following Election by
the Callholder to Remarket . . . . . . . . . . . . .27
ARTICLE FOUR ADDITIONAL EVENTS OF DEFAULT WITH RESPECT
TO THE NOTES . . . . . . . . . . . . . . . . . . . . . . . .28
Section 401 Definition . . . . . . . . . . . . . . . . . . .28
ARTICLE FIVE AUTHENTICATION AND DELIVERY OF THE NOTES. . . . . . . .28
Section 501 Authentication and Delivery. . . . . . . . . . .28
ARTICLE SIX SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . .29
Section 601 Effect On Original Indenture . . . . . . . . . .29
ARTICLE SEVEN MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . .29
Section 701 Counterparts . . . . . . . . . . . . . . . . . .29
Section 702 Recitals . . . . . . . . . . . . . . . . . . . .29
Section 703 Governing Law. . . . . . . . . . . . . . . . . .29
This First Supplemental Indenture, dated as of September 1,
1998 between TECO Energy, Inc., a corporation duly organized and
existing under the laws of the State of Florida (hereinafter
called the "Company") and having its principal office at TECO
Plaza, 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000, and The
Bank of New York, (hereinafter called the "Trustee") and having
its principal corporate trust office at 000 Xxxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000.
WITNESSETH:
WHEREAS, the Company and the Trustee entered into an
Indenture, dated as of August 17, 1998 (the "Original
Indenture"), pursuant to which one or more series of debt of the
Company (the "Securities") may be issued from time to time; and
WHEREAS, Section 201 of the Original Indenture permits the
terms of any series of Securities to be established in an
indenture supplemental to the Original Indenture; and
WHEREAS, Section 901(7) of the Original Indenture provides
that a supplemental indenture may be entered into by the Company
and the Trustee without the consent of any Holders of the
Securities to establish the form and terms of the Securities of
any series; and
WHEREAS, the Company has requested the Trustee to join with
it in the execution and delivery of this First Supplemental
Indenture in order to supplement and amend the Original
Indenture by, among other things, establishing the form and
terms of one series of Securities to be known as the Company's
"Remarketed Notes Due 2038" (the "Notes") and amending and
adding certain provisions thereof for the benefit of the Holders
of the Notes; and
WHEREAS, the Company and the Trustee desire to enter into
this First Supplemental Indenture for the purposes set forth in
Sections 201 and 901 of the Original Indenture as referred to
above; and
WHEREAS, the Company has furnished the Trustee with a Board
Resolution authorizing the execution of this First Supplemental
Indenture; and
WHEREAS, all things necessary to make this First
Supplemental Indenture a valid agreement of the Company and the
Trustee and a valid supplement to the Original Indenture have
been done,
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE
WITNESSETH:
For and in consideration of the premises and the purchase
of the Notes to be issued hereunder by holders thereof, the
Company and the Trustee mutually covenant and agree, for the
equal and proportionate benefit of the respective holders from
time to time of the Notes, as follows:
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions
All capitalized terms that are used herein and not
otherwise defined herein shall have the meanings assigned to
them in the Original Indenture. The Original Indenture together
with this First Supplemental Indenture are hereinafter sometimes
collectively referred to as the "Indenture."
"Applicable Spread" shall mean the lowest bid indication,
expressed as a spread (in the form of a percentage or in basis
points) above the Base Rate, obtained by the Callholder on the
applicable Determination Date from the bids quoted by up to five
Reference Corporate Dealers for the full aggregate outstanding
principal amount of the Notes at the Dollar Price, but assuming
(i) an issue date equal to the applicable REPS Remarketing Date,
with settlement on such date without accrued interest, (ii) a
maturity date equal to the next succeeding Interest Rate
Adjustment Date of the Notes, and (iii) a stated annual interest
rate, payable semiannually on each Interest Payment Date, equal
to the Base Rate plus the spread bid by the applicable Reference
Corporate Dealer. If fewer than five Reference Corporate
Dealers bid as described above, then the Applicable Spread shall
be the lowest of such bid indications obtained as described
above. The REPS Interest Rate announced by the Callholder,
absent manifest error, shall be binding and conclusive upon the
Beneficial Owners and holders of the Notes, the Company and the
Trustee.
"Base Rate" shall mean the interest rate established by the
Callholder, after consultation with the Company, as the
applicable "base rate" at commencement of the applicable REPS
Mode.
"Beneficial Owner" shall mean, for Notes in book-entry
form, the Person who acquires an interest in the Notes, which is
reflected on the records of the Depositary through its
participants.
"Business Day" shall mean any day that is not a day on
which banking institutions in New York, New York, or the state
in which the office of the Trustee at which the Indenture is
administered are authorized or obligated by law or executive
order to close; provided, however, that with respect to Notes in
the Long Term Rate Mode or the REPS Mode as to which LIBOR is an
applicable Interest Rate Basis, such day is also a London
Business Day (as hereinafter defined). "London Business Day"
shall mean (i) if the Index Currency (as hereinafter defined) is
other than European Currency Units ("ECU"), any day on which
dealings in such Index Currency are transacted in the London
interbank market or (ii) if the Index Currency is ECU, any day
that does not appear as an ECU non-settlement day on the display
designated as "ISDE" on the Reuters Monitor Money Rates Service
(or a day so designated by the ECU Banking Association) or, if
ECU non-settlement days do not appear on the page (and are not
so designated), is a day on which payments in ECU can be settled
in the international banking market.
"Calculation Agent" shall have the meaning specified in
Section 206(a) hereof.
"Calculation Date" shall have the meaning specified in
Section 206(a) hereof.
"Callholder" shall mean the remarketing agent granted the
option under a REPS Remarketing Agreement to purchase Notes in
the REPS Mode and subsequently remarket the repurchased Notes at
a REPS Interest Rate.
"CD Rate" shall have the meaning specified in Section
206(b)(1) hereof.
"CMT Rate" shall have the meaning specified in Section
206(b)(2) hereof.
"Commercial Paper Term Mode" shall mean, with respect to
any Note, the Interest Rate Mode in which the interest rate on
such Note is reset on a periodic basis that shall not be less
than one calendar day nor more than 364 consecutive calendar
days and interest is paid as provided for such Interest Rate
Mode in Section 204(e)(1) hereof.
"Commercial Paper Term Period" shall mean, with respect to
any Note, the Interest Rate Period in the Commercial Paper Term
Mode that is a period of not less than one nor more than 364
consecutive calendar days, as determined by the Company or, if
not so determined, by the Remarketing Agent for such Note (in
its best judgment in order to obtain the lowest interest cost
for the Note). Each Commercial Paper Term Period will commence
on the Interest Rate Adjustment Date therefor and end on the day
preceding the date specified by such Remarketing Agent as the
first day of the next Interest Rate Period for the Notes. The
interest rate for any Commercial Paper Term Period relating to
any Note will be determined not later than 11:50 a.m., New York
City time, on the Interest Rate Adjustment Date for the Note,
which is the first day of each Interest Period for such Note.
"Comparable Treasury Issues" shall mean the United States
Treasury security or securities selected by the Callholder as
having an actual or interpolated maturity or maturities
comparable or applicable to the remaining term to the next
succeeding Interest Rate Adjustment Date of the Notes being
purchased.
"Comparable Treasury Price" shall mean, with respect to the
REPS Remarketing Date, (a) the offer prices for the Comparable
Treasury Issues (expressed in each case as a percentage of its
principal amount) at 11:00 a.m. on the Determination Date, as
set forth on Telerate Page 500 (or such other page as may
replace Telerate Page 500) or (b) if such page (or any successor
page) is not displayed or does not contain such offer prices on
such Determination Date, (i) the average of the Reference
Treasury Dealer Quotations for such REPS Remarketing Date, after
excluding the highest and lowest of such Reference Treasury
Dealer Quotations, or (ii) if the Callholder obtains fewer than
four such Reference Treasury Dealer Quotations, the average of
all such Reference Treasury Dealer Quotations. "Telerate Page
500" shall mean the display designated as "Telerate Page 500" on
Dow Xxxxx Markets (or such other page as may replace Telerate
Page 500 on such service) or such other service displaying the
offer prices specified in (a) above as may replace Dow Xxxxx
Markets.
"Composite Quotations" shall mean the daily statistical
release entitled "Composite 3:30 P.M. Quotations for United
States Government Securities" published by the Federal Reserve
Bank of New York or any successor publication.
"Depositary" shall have the meaning specified in Section
203 hereof.
"Designated CMT Telerate Page" shall mean the display on
the Dow Xxxxx Markets (or any successor service) on the page
specified in the applicable Floating Interest Rate Notice (or
any other page as may replace such page on such service for the
purpose of displaying Treasury Constant Maturities as reported
in H.15(519)) for the purpose of displaying Treasury Constant
Maturities as reported in H.15(519). If no such page is
specified in the applicable Floating Interest Rate Notice, the
page shall be 7052 for the most recent week.
"Designated CMT Maturity Index" shall mean the original
period to maturity of the United States Treasury securities
(either 1, 2, 3, 5, 7, 10, 20 or 30 years) specified in the
applicable Floating Interest Rate Notice with respect to which
the CMT Rate will be calculated. If no such maturity is
specified in the applicable Floating Interest Rate Notice, the
Designated CMT Maturity Index shall be 2 years.
"Designated LIBOR Page" shall mean (a) if "LIBOR Reuters"
is specified in the applicable Floating Interest Rate Notice,
the display on the Reuters Monitor Money Rates Service (or any
successor service) on the page specified in such Floating
Interest Rate Notice (or any other page as may replace such page
on such service) for the purpose of displaying the London
interbank rates of major banks for the Index Currency, or (b) if
"LIBOR Telerate" is specified in the applicable Floating
Interest Rate Notice or neither "LIBOR Reuters" nor "LIBOR
Telerate" is specified in the applicable Floating Interest Rate
Notice as the method for calculating LIBOR, the display on the
Dow Xxxxx Markets (or any successor service) on the page
specified in such Floating Interest Rate Notice (or any other
page as may replace such page on such service) for the purpose
of displaying the London interbank rates of major banks for the
Index Currency.
"Determination Date" shall mean the third Business Day
immediately preceding the applicable REPS Remarketing Date.
"Dollar Price" shall mean the present value determined by
the Callholder, as of the applicable REPS Remarketing Date, of
the Remaining Scheduled Payments discounted to such REPS
Remarketing Date, on a semiannual basis (assuming a 360-day year
consisting of twelve 30-day months), at the Treasury Rate.
"DTC Participant" shall mean an account maintained by an
institution with the Depositary through which securities are
held by such institution and accounted for by a book-entry
registration and transfer system.
"Federal Funds Rate" shall have the meaning specified in
Section 206(b)(3) hereof.
"Floating Interest Rate Notice" shall have the meaning
specified in Section 206(a) hereof. The form of Floating Rate
Interest Notice is set forth as Exhibit C to this First
Supplemental Indenture.
"Floating Rate Maximum Interest Rate" and "Floating Rate
Minimum Interest Rate" have the respective meanings specified in
Section 206(a) hereof.
"H.15(519)" shall mean "Statistical Release H.15(519),
Selected Interest Rates" published by the Board of Governors of
the Federal Reserve System or any successor publication.
"Index Currency" shall mean the currency or composite
currency specified in the applicable Floating Interest Rate
Notice as to which LIBOR will be calculated. If no such
currency or composite currency is specified in the applicable
Floating Interest Rate Notice, the Index Currency will be United
States dollars.
"Index Maturity" shall mean the period to maturity of the
instrument or obligation with respect to which the related
Interest Rate Basis or Bases will be calculated.
"Initial Interest Rate" shall mean the annual rate of
interest applicable to the Notes during the Initial Interest
Rate Period.
"Initial Interest Rate Period" shall mean the period from
the Original Issue Date to, but excluding, Initial REPS
Remarketing Date.
"Initial Callholder" shall mean the Callholder with the
option to purchase the Notes on the Initial REPS Remarketing
Date.
"Initial REPS Remarketing Date" shall mean the date
designated by the Initial Callholder, after consultation with
the Company, upon which the Initial Callholder may, if it has so
elected, remarket the Notes at the REPS Interest Rate.
"Interest Determination Date" shall have the meaning
specified in Section 206(a) hereof.
"Interest Payment Date" shall have the meaning set forth in
Section 204(c) hereof.
"Interest Rate Adjustment Date" shall mean (i) for a
particular Interest Rate Period in any Interest Rate Mode, each
date, which shall be a Business Day, on which interest and, in
the case of a floating interest rate, the Spread (if any) and
the Spread Multiplier (if any) on the Notes subject thereto
commences to accrue at the rate determined and announced by the
applicable Remarketing Agent for such Interest Rate Period, and
(ii) for Notes in the Initial Interest Rate Period, the Original
Issue Date.
"Interest Rate Basis" shall have the meaning specified in
Section 206(a) hereof.
"Interest Rate Mode" shall mean the mode in which the
interest rate on a Note is being determined, i.e., the
Commercial Paper Term Mode, the Long Term Rate Mode or the REPS
Mode.
"Interest Rate Period" shall mean (a) with respect to any
Note in the Commercial Paper Term Mode or Long Term Rate Mode,
the period of time commencing on the Interest Rate Adjustment
Date and extending either (i) to, but not including, the
immediately succeeding Interest Rate Adjustment Date or (ii) if
there is no succeeding Interest Rate Adjustment Date, to, but
not including, the Stated Maturity, and during which such Note
bears interest at a particular fixed interest rate or floating
interest rate, and (b) with respect to any Note in the REPS
Mode, the REPS Rate Period.
"Interest Reset Date" and "Interest Reset Period" have the
respective meanings specified in Section 206(a) hereof.
"LIBOR" shall have the meaning specified in Section
206(b)(4) hereof.
"Long Term Rate Mode" shall mean, with respect to any Note,
the Interest Rate Mode in which the interest rate on such Note
is reset in a Long Term Rate Period and interest is paid as
provided for such Interest Rate Mode in Section 204(e)(2)
hereof.
"Long Term Rate Period" shall mean, with respect to any
Note, any period of more than 364 days and not exceeding the
remaining term to the Stated Maturity of such Note.
"Notification Date" shall mean a Business Day not later
than five (5) Business Days prior to the applicable REPS
Remarketing Date.
"Optional Redemption" shall mean the redemption of any Note
prior to its maturity at the option of the Company as described
herein.
"Optional Redemption Price" shall have the meaning
specified in Section 305(c) hereof.
"Original Issue Date" shall mean the date upon which the
Notes are initially issued by the Company, such date to be set
forth on the face of the Note.
"Prime Rate" shall have the meaning specified in Section
206(b)(5) hereof.
"Principal Financial Center" shall mean the capital city of
the country issuing the Index Currency, except that with respect
to United Stated dollars, Australian dollars, Deutsche marks,
Dutch guilders, Italian lire, Swiss francs and ECUs, the
Principal Financial Center shall be the City of New York,
Sydney, Frankfurt, Amsterdam, Milan, Zurich and Luxembourg,
respectively.
"Reference Corporate Dealers" shall mean such Reference
Corporate Dealers as shall be appointed by the Callholder after
consultation with the Company.
"Reference Treasury Dealers" shall mean such Reference
Treasury Dealers as shall be appointed by the Callholder after
consultation with the Company.
"Reference Treasury Dealer Quotation" shall mean, with
respect to each Reference Treasury Dealer and the REPS
Remarketing Date, the offer prices for the Comparable Treasury
Issues (expressed in each case as a percentage of its principal
amount) quoted in writing to the Callholder by such Reference
Treasury Dealer by 3:30 p.m., New York City time, on the
Determination Date.
"Remaining Scheduled Payments" shall mean, with respect to
the Notes, the remaining scheduled payments of the principal
thereof and interest thereon, calculated at the Base Rate only,
that would be due after the REPS Remarketing Date to and
including the next succeeding Interest Rate Adjustment Date.
"Remarketing Agent" shall mean such agent or agents,
including any standby remarketing agent (each a "Standby
Remarketing Agent"), as the Company may appoint from time to
time for the purpose of remarketing of the Notes, as set forth
in the remarketing agreement that the Company shall enter into
prior to the remarketing of such Notes.
"REPS Interest Rate" shall mean the rate equal to the Base
Rate established by a Callholder, after consultation with the
Company, at or prior to the commencement of the applicable REPS
Mode, plus the Applicable Spread, which will be based on the
Dollar Price.
"REPS Mode" shall mean, with respect to any Note, the
Interest Rate Mode in which such Note shall bear interest and be
subject to remarketing as "REset Put Securities" ("REPS") as
provided for in Article Three hereof.
"REPS Period" shall mean, with respect to any Note
remarketed by the Initial Callholder on the Initial REPS
Remarketing Date, that portion of the REPS Rate Period
commencing on the Initial REPS Remarketing Date up to, but
excluding, the next succeeding Interest Rate Adjustment Date.
"REPS Rate Period" shall mean an Interest Rate Period for
any Note in the REPS Mode established by the Company as a period
of more than 364 days and less than the remaining term to the
Stated Maturity of such Note; provided, however, that such
Interest Rate Period must end on the day prior to an Interest
Payment Date for such Note. The REPS Rate Period shall consist
of the period to and excluding the REPS Remarketing Date and the
period from and including the REPS Remarketing Date to, but
excluding, the next succeeding Interest Rate Adjustment Date.
"REPS Remarketing Agreement" shall mean the agreement by
and between the Company and the Callholder dated as of the date
commencing the applicable REPS Rate Period that sets forth the
rights and obligations of the Company and the Callholder with
respect to the remarketing of Notes in the REPS Mode.
"REPS Remarketing Date" shall mean the date designated by
the Callholder, after consultation with the Company, upon which
the Callholder may elect to remarket the Notes at the REPS
Interest Rate.
"Reuters Screen U.S. PRIME 1 Page" shall mean the display
designated as page "U.S. PRIME 1" on the Reuters Monitor Money
Rates Service (or any successor service) on the U.S. PRIME 1
Page (or such other page as may replace the U.S. PRIME 1 Page on
such service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
"Special Interest Rate" shall have the meaning set forth in
Section 205 hereof.
"Special Mandatory Purchase" shall have the meaning
specified in Section 210(a) hereof.
"Spread" shall mean the number of basis points to be added
to or subtracted from the related Interest Rate Basis or Bases
applicable to an Interest Rate Period for such Note.
"Spread Multiplier" shall mean the percentage of the
related Interest Rate Basis or Bases applicable to an Interest
Rate Period by which such Interest Rate Basis or Bases will be
multiplied to determine the applicable interest rate from time
to time for an Interest Rate Period.
"Stated Maturity" shall mean September 15, 2038.
"Treasury Bills" shall have the meaning specified in
Section 206(b)(6) hereof.
"Treasury Rate" shall have the meaning specified in Section
206(b)(6) hereof.
"Weekly Rate Period" shall have the meaning specified in
Section 204(e)(1) hereof.
Section 102. Section References
Each reference to a particular section set forth in this
First Supplemental Indenture shall, unless the context otherwise
requires, refer to this First Supplemental Indenture.
ARTICLE TWO
Designation and Terms of the Notes
Section 201. Establishment of Series
There is hereby created a series of Securities to be known
and designated as the "Remarketed Notes Due 2038" (the "Notes"),
which shall rank equally with each other and all other unsecured
and unsubordinated indebtedness of the Company. For the
purposes of the Original Indenture, the Notes shall constitute a
single series of Securities.
Section 202. Variations in Terms of Notes
Subject to the terms and conditions set forth in the
Original Indenture and in this First Supplemental Indenture, the
terms of any particular Note may vary from the terms of any
other Note as contemplated by Section 301 of the Original
Indenture, and the terms for a particular Note will be set forth
in such Note as delivered to the Trustee or an Authenticating
Agent for authentication pursuant to Section 303 of the Original
Indenture.
Section 203. Amount and Denominations; the Depositary
The aggregate principal amount of Notes that may be issued
under this First Supplemental Indenture is limited to
$150,000,000.
The Notes shall be issuable only in fully registered form
and will initially be registered in the name of The Depository
Trust Company or its successor ("Depositary"), or its nominee
who is hereby designated as "U.S. Depositary" under the Original
Indenture. The authorized denominations of Notes shall be
$100,000 and integral multiples of $1,000 in excess thereof.
Section 204. Interest Rates, Interest Payment Dates and
Interest Rate Periods
(a) Initial Interest Rate. The Notes shall initially bear
interest at the annual rate set forth in Annex A thereof (the
"Initial Interest Rate") from the Original Issue Date to, but
excluding, the Initial REPS Remarketing Date.
(b) Interest Rate(s) Subsequent to the Initial Interest
Rate. If the Initial Callholder elects to purchase the Notes as
described in Section 304 hereof, the Notes shall be subject to
mandatory tender to the Initial Callholder on the Initial REPS
Remarketing Date, except in the limited circumstances described
in Section 304 hereof, and shall for the REPS Period bear
interest at the REPS Interest Rate as described in Section
304(b) hereof.
If the Initial Callholder does not purchase the Notes on
the Initial REPS Remarketing Date, thereafter each Note shall
bear interest at a rate or rates in a new REPS Mode, a Long Term
Rate Mode or a Commercial Paper Term Mode if remarketed as
provided for in Section 209 hereof, or otherwise shall be
redeemed by the Company as provided for under Section 210(b)
hereof. Each Note may bear interest for designated Interest
Rate Periods in the same or a different Interest Rate Mode from
other Notes. The interest rate for the Notes shall be
established periodically by the applicable Remarketing Agent as
provided for in Section 209 hereof. Each Note will set forth on
Annex A thereof the then applicable Interest Rate Mode of such
Note, its interest rate, each Interest Rate Adjustment Date, the
Interest Rate Period and such other information indicated in the
form of Annex A attached to Exhibit A hereto.
(c) Payment of Interest. Interest shall be payable on any
Note at maturity and (i) for the Initial Interest Rate Period,
on the dates set forth on the face thereof; (ii) for any
Interest Rate Period in the Commercial Paper Term Mode, on the
Interest Rate Adjustment Date commencing the next succeeding
Interest Rate Period for such Note and on such other dates (if
any) as shall be established upon conversion of such Note to the
Commercial Paper Term Mode or upon remarketing of the Note in a
new Interest Rate Period in the Commercial Paper Term Mode and
set forth in Annex A to the applicable Note; and (iii) in the
Long Term Rate Mode or REPS Mode, no less frequently than
semiannually on such dates as will be established upon
conversion of such Note to the Long Term Rate Mode or the REPS
Mode (or upon remarketing of the Note in a new Interest Rate
Period in the Long Term Rate Mode or the REPS Mode, as the case
may be) and set forth in Annex A to the applicable Note in the
case of a fixed interest rate, or as described below in Section
206 in the case of a floating interest rate, and on the Interest
Rate Adjustment Date commencing the next succeeding Interest
Rate Period (each such date, an "Interest Payment Date"). Such
interest will be payable to the holder thereof as of the related
Record Date, which, for any Note (x) during the Initial Interest
Rate Period is the fifteenth calendar day (whether or not a
Business Day) immediately preceding the related Interest Payment
Date; (y) in the Commercial Paper Term Mode, is the Business Day
prior to the related Interest Payment Date; and (z) in the Long
Term Rate Mode or the REPS Mode, is the fifteenth calendar day
(whether or not a Business Day) immediately preceding the
related Interest Payment Date. If any Interest Payment Date
would otherwise be a day that is not a Business Day, such
Interest Payment Date will be postponed to the next succeeding
Business Day, and no interest will accrue on such payment for
the period from and after such Interest Payment Date to the date
of such payment on the next succeeding Business Day.
(d) Computation of Interest. Interest on Notes bearing
interest in the Commercial Paper Term Mode or at a floating
interest rate during an Interest Rate Period in the Long Term
Rate Mode or the REPS Mode will be computed on the basis of
actual days elapsed over 360; provided that, if an applicable
Interest Rate Basis is the CMT Rate or Treasury Rate (each as
defined in Section 206 hereof), interest will be computed on the
basis of actual days elapsed over the actual number of days in
the year. Interest on Notes bearing interest at a fixed rate in
the Long Term Rate Mode or REPS Mode will be computed on the
basis of a year of 360 days consisting of twelve 30-day months.
Interest on Notes at the Initial Interest Rate will be computed
on the basis of a year of 360 days consisting of twelve 30-day
months.
(e) Interest Rate Modes. The Interest Rate Period for
each interest rate mode shall be determined in accordance with
this subsection (e) subject to possibility of extension of such
period pursuant to standby remarketing arrangements, if any, as
described in Section 209(b) hereof.
(1) Commercial Paper Term Mode. The Interest Rate
Period for any Note in the Commercial Paper Term Mode will be a
period of not less than one nor more than 364 consecutive
calendar days (a "Commercial Paper Term Period"), as determined
by the Company (as described in Section 207 below) or, if not so
determined, by the Remarketing Agent for such Note (in its best
judgment in order to obtain the lowest interest cost for such
Note). Each Commercial Paper Term Period will commence on the
Interest Rate Adjustment Date therefor and end on the day
preceding the date specified by such Remarketing Agent as the
first day of the next Interest Rate Period for such Note. A
"Weekly Rate Period" is a Commercial Paper Term Period and shall
be a period of seven days commencing on any Interest Rate
Adjustment Date and ending on the day preceding the first day of
the next Interest Rate Period for such Note. The interest rate
for any Commercial Paper Term Period relating to a Note shall be
determined not later than 11:50 a.m., New York City time, on the
Interest Rate Adjustment Date for such Note (subject to Section
209 hereof), which is the first day of each Interest Period for
such Note.
(2) Long Term Rate Mode. The Interest Rate Period
for any Note in the Long Term Rate Mode shall be established by
the Company (as described in Section 207 hereof) as a period of
more than 364 days and not exceeding the remaining term to the
Stated Maturity of such Note (a "Long Term Rate Period"). The
interest rate, or Spread (if any) and Spread Multiplier (if
any), for any Note in the Long Term Rate Mode shall be
determined not later than 11:50 a.m., New York City time, on the
Interest Rate Adjustment Date for such Note, which is the first
day of each Interest Rate Period for such Note.
(3) REPS Mode. So long as any Note is in a REPS
Mode during the period up to, but excluding, the applicable REPS
Remarketing Date, the provisions set forth in this Article Two
are applicable to the remarketing of Notes generally, but only
to the extent expressly provided in Article Three. The Interest
Rate Period for any Note in the REPS Mode shall be established
by the Company (as described in Section 207 hereof) as a period
of more than 364 days and not exceeding the remaining term to
the Stated Maturity of such Note (a "REPS Rate Period"). A REPS
Rate Period shall consist of the period to and excluding the
REPS Remarketing Date and the period from and including the REPS
Remarketing Date to, but excluding, the next succeeding Interest
Rate Adjustment Date, as described in Article Three and subject
to the conditions therein and otherwise herein described. The
interest rate and, in the case of a floating interest rate, the
Spread (if any), and the Spread Multiplier (if any) to the REPS
Remarketing Date for any Note in the REPS Mode shall be
determined not later than 11:50 a.m., New York City time, on the
Interest Rate Adjustment Date for such Note, which for the REPS
Mode is the first day of each Interest Rate Period for such
Note.
Section 205. Determination of Interest Rates
The interest rate and, in the case of a floating interest
rate, the Spread (if any), and the Spread Multiplier (if any),
for any Note shall be established by the applicable Remarketing
Agent in a remarketing as provided for in Section 207 hereof or
otherwise not later than the first day of each succeeding
Interest Rate Period for such Note, which must be a Business Day
(each an "Interest Rate Adjustment Date"), and will be the
minimum rate of interest and, in the case of a floating interest
rate, Spread (if any) and Spread Multiplier (if any) necessary
in the judgment of such Remarketing Agent to produce a par bid
in the secondary market for such Note on the date the interest
rate is established. Such rate will be effective for the next
succeeding Interest Rate Period for such Note commencing on such
Interest Rate Adjustment Date.
In the event that (i) the applicable Remarketing Agent has
been removed or has resigned and no successor has been
appointed; or (ii) such Remarketing Agent has failed to announce
the appropriate interest rate, Spread (if any) or Spread
Multiplier (if any), as the case may be, on the Interest Rate
Adjustment Date for any Note for whatever reason; or (iii) the
appropriate interest rate, Spread (if any) or Spread Multiplier
(if any), as the case may be, or Interest Rate Period cannot be
determined for any Note for whatever reason, then the next
succeeding Interest Rate Period for such Note shall be
automatically converted to a Weekly Rate Period, and the rate of
interest thereon will be equal to the Federal Funds Rate (such
rate of interest being referred to herein as the "Special
Interest Rate").
After any Interest Rate Adjustment Date any Beneficial
Owner may contact the Trustee or the Remarketing Agent in order
to be advised of the interest rate applicable to such Beneficial
Owner's remarketed Notes. No notice of the applicable interest
rate will be sent to Beneficial Owners.
The interest rate and other terms announced by the
Remarketing Agent, absent manifest error, shall be binding and
conclusive upon the Beneficial Owners, the Company and the
Trustee.
Section 206. Election and Determination of a Floating
Interest Rate by the Company
(a) While any Note bears interest in the Long Term Rate
Mode or the REPS Mode (with respect to the period from, and
including, the Interest Rate Adjustment Date commencing such
period to, but excluding, the REPS Remarketing Date), the
Company may elect a floating interest rate by providing notice,
which shall be submitted or promptly confirmed in writing (which
includes facsimile or appropriate electronic media), received by
the Trustee and the Remarketing Agent for such Note (the
"Floating Interest Rate Notice") not less than ten (10) days
prior to the Interest Rate Adjustment Date for such Long Term
Rate Period or REPS Rate Period. The Floating Interest Rate
Notice must identify by CUSIP number or otherwise the portion of
the Note to which it relates and state the Interest Rate Period
(or portion thereof, in the case of the REPS Mode) therefor to
which it relates. Each Floating Interest Rate Notice must also
state the Interest Rate Basis or Bases, the initial Interest
Reset Date, the Interest Reset Period and Interest Reset Dates,
the Interest Rate Period and Interest Payment Dates, the Index
Maturity and the Floating Rate Maximum Interest Rate and/or
Floating Rate Minimum Interest Rate, if any. If one or more of
the applicable Interest Rate Bases is LIBOR or the CMT Rate, the
Floating Interest Rate Notice shall also specify the Index
Currency and Designated LIBOR Page or the Designated CMT
Maturity Index and Designated CMT Telerate Page, respectively.
A form of Floating Interest Rate Notice is attached hereto as
Exhibit C.
If any Note bears interest at a floating rate in a Long
Term Rate Period or REPS Rate Period, such Note shall bear
interest at the rate determined by reference to the applicable
Interest Rate Basis or Bases (a) plus or minus the Spread (if
any) and/or (b) multiplied by the Spread Multiplier (if any)
specified by the Remarketing Agent, in the case of a Long Term
Rate Period, or the Callholder, in the case of a REPS Rate
Period. Commencing on the Interest Rate Adjustment Date for
such Interest Rate Period, the rate at which interest on such
Note will be payable shall be reset as of each Interest Reset
Date during such Interest Rate Period specified in the
applicable Floating Interest Rate Notice.
The applicable floating interest rate on any Note during
any Interest Rate Period shall be determined by reference to the
applicable Interest Rate Basis or Bases, which may include (i)
the CD Rate, (ii) the CMT Rate, (iii) the Federal Funds Rate,
(iv) LIBOR, (v) the Prime Rate, (vi) the Treasury Rate or (vii)
such other Interest Rate Basis or interest rate formula as may
be specified in the applicable Floating Interest Rate Notice
(each, an "Interest Rate Basis").
Unless otherwise specified in the applicable Floating
Interest Rate Notice, the interest rate with respect to each
Interest Rate Basis shall be determined in accordance with the
applicable provisions of this Section 206. Except as set forth
above or in the applicable Floating Interest Rate Notice, the
interest rate in effect on each day shall be (i), if such day is
an Interest Reset Date, the interest rate determined as of the
Interest Determination Date immediately preceding such Interest
Reset Date or (ii), if such day is not an Interest Reset Date,
the interest rate determined as of the Interest Determination
Date immediately preceding the most recent Interest Reset Date.
If any Interest Reset Date would otherwise be a day that is not
a Business Day, such Interest Reset Date shall be postponed to
the next succeeding Business Day, unless LIBOR is an applicable
Interest Rate Basis and such Business Day falls in the next
succeeding calendar month, in which case such Interest Reset
Date shall be the immediately preceding Business Day. In
addition, if the Treasury Rate is an applicable Interest Rate
Basis and the Interest Determination Date would otherwise fall
on an Interest Reset Date, then such Interest Reset Date shall
be postponed to the next succeeding Business Day.
The applicable Floating Interest Rate Notice will specify
whether the rate of interest will be reset daily, weekly,
monthly, quarterly, semiannually or annually or on such other
specified basis (each, an "Interest Reset Period") and the dates
on which such rate of interest will be reset (each, an "Interest
Reset Date"). Unless otherwise specified in the applicable
Floating Interest Rate Notice, the Interest Reset Dates will be,
in the case of a floating interest rate which resets: (i) daily,
each Business Day; (ii) weekly, the Wednesday of each week
(unless the Treasury Rate is an applicable Interest Rate Basis,
in which case the Tuesday of each week except as described
below); (iii) monthly, the third Wednesday of each month; (iv)
quarterly, the third Wednesday of March, June, September and
December of each year; (v) semiannually, the third Wednesday of
the two months specified in the applicable Floating Interest
Rate Notice; and (vi) annually, the third Wednesday of the month
specified in the applicable Floating Interest Rate Notice.
The interest rate applicable to each Interest Reset Period
commencing on the related Interest Reset Date shall be the rate
determined as of the applicable Interest Determination Date.
The "Interest Determination Date" shall mean (i), with respect
to the CD Rate, the CMT Rate, the Federal Funds Rate and the
Prime Rate, the second Business Day immediately preceding the
applicable Interest Reset Date; (ii) with respect to LIBOR, the
second London Business Day immediately preceding the applicable
Interest Reset Date, unless the Index Currency is British pounds
sterling, in which case it shall mean the applicable Interest
Reset Date; and (iii) with respect to the Treasury Rate, the day
within the week in which the applicable Interest Reset Date
falls upon which day Treasury Bills are normally auctioned;
provided, however, that if an auction is held on the Friday of
the week preceding the applicable Interest Reset Date, the
"Interest Determination Date" shall mean such preceding Friday.
If the interest rate of any Note is a floating interest rate
determined with reference to two or more Interest Rate Bases
specified in the applicable Floating Interest Rate Notice, the
Interest Determination Date pertaining to the Note shall be the
most recent Business Day which is at least two Business Days
prior to the applicable Interest Reset Date on which each
Interest Rate Basis shall determinable. Each Interest Rate
Basis will be determined as of such date, and the applicable
interest rate shall take effect on the related Interest Reset
Date.
Either or both of the following may also apply to the
floating interest rate on any Note for an Interest Rate Period:
(i) a floating rate maximum interest rate, or ceiling, that may
accrue during any Interest Reset Period (the "Floating Rate
Maximum Interest Rate") and (ii) a floating rate minimum
interest rate, or floor, that may accrue during any Interest
Reset Period (the "Floating Rate Minimum Interest Rate"). In
addition to any Floating Rate Maximum Interest Rate that may
apply, the interest rate on any Note shall in no event be higher
than the maximum rate permitted under the law of the State of
New York, as the same may be modified by United States laws of
general application.
Except as provided below or in the applicable Floating
Interest Rate Notice, interest will be payable, in the case of
floating interest rates which reset: (i) daily, weekly or
monthly, on the third Wednesday of each month; (ii) quarterly,
on the third Wednesday of March, June, September and December of
each year; (iii) semiannually, on the third Wednesday of the two
months of each year specified in the applicable Floating
Interest Rate Notice; and (iv) annually, on the third Wednesday
of the month of each year specified in the applicable Floating
Interest Rate Notice and, in each case, on the Business Day
immediately following the applicable Long Term Rate Period or
REPS Rate Period, as the case may be. If any Interest Payment
Date for the payment of interest at a floating rate (other than
following the end of the applicable Long Term Rate Period or
REPS Rate Period, as the case may be) would otherwise be a day
that is not a Business Day, such Interest Payment Date will be
postponed to the next succeeding Business Day, except that if
LIBOR is an applicable Interest Rate Basis and such Business Day
falls in the next succeeding calendar month, such Interest
Payment Date will be the immediately preceding Business Day.
All percentages resulting from any calculation of floating
interest rates will be rounded to the nearest one hundred
thousandth of a percentage point, with five one-millionths of a
percentage point rounded upwards (e.g., 9.876545% (or .09876545)
would be rounded to 9.87655% (or .0987655)), and all amounts
used in or resulting from such calculation will be rounded, in
the case of United States dollars, to the nearest cent or, in
the case of a foreign currency or composite currency, to the
nearest unit (with one-half cent or unit being rounded upwards).
Accrued floating rate interest will be calculated by
multiplying the principal amount of the applicable Note by an
accrued interest factor. Such accrued interest factor will be
computed by adding the interest factor calculated for each day
in the applicable Interest Reset Period. Unless otherwise
specified in the applicable Floating Interest Rate Notice, the
interest factor for each such day will be computed by dividing
the interest rate applicable to such day by 360, if an
applicable Interest Rate Basis is the CD Rate, the Federal Funds
Rate, LIBOR or the Prime Rate, or by the actual number of days
in the year if an applicable Interest Rate Basis is the CMT Rate
or the Treasury Rate. Unless otherwise specified in the
applicable Floating Interest Rate Notice, if the floating
interest rate is calculated with reference to two or more
Interest Rate Bases, the interest factor will be calculated in
each period in the same manner as if only one of the applicable
Interest Rate Bases applied as specified in the applicable
Floating Interest Rate Notice.
For any Note bearing interest at a floating rate, the
applicable Remarketing Agent shall determine the interest rate
in effect from the Interest Rate Adjustment Date for such Note
to the initial Interest Reset Date. The interest rate in effect
for each Interest Reset Period thereafter shall be determined by
a calculation agent selected by the Company (a "Calculation
Agent"). Upon request of the Beneficial Owner of a Note, after
any Interest Rate Adjustment Date, the Calculation Agent or the
Remarketing Agent shall disclose the interest rate and, in the
case of a floating interest rate, Interest Rate Basis or Bases,
Spread (if any) and Spread Multiplier (if any), and in each case
the other terms applicable to such Note then in effect and, if
determined, the interest rate that will become effective as a
result of a determination made for the next succeeding Interest
Reset Date with respect to such Note. Except as described
herein with respect to a Note earning interest at floating
rates, the Beneficial Owner of a note shall not be entitled to
receive notice of the applicable interest rate, Spread (if any)
or Spread Multiplier (if any).
Unless otherwise specified in the applicable Floating
Interest Rate Notice, the "Calculation Date," if applicable,
pertaining to any Interest Determination Date will be the
earlier of (i) the tenth calendar day after such Interest
Determination Date or, if such day is not a Business Day, the
next succeeding Business Day or (ii) the Business Day
immediately preceding the applicable Interest Payment Date or
the Stated Maturity, as the case may be.
(b) Interest Rate Bases for Floating Interest Rates. The
basis for the floating interest rate on any Note during any
Interest Rate Period may include, but is not limited to, any of
the following bases (each, an "Interest Rate Basis"):
(1) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as the
"CD Rate," the CD Rate shall mean, with respect to any Interest
Determination Date relating to a Note for which the interest
rate is determined with reference to the CD Rate (a "CD Rate
Interest Determination Date"), the rate on such date for
negotiable United States dollar certificates of deposit having
the Index Maturity specified in the applicable Floating Interest
Rate Notice as published in H.15(519) under the heading "CDs
(Secondary Market)," or, if not published by 3:00 p.m., New York
City time, on the related Calculation Date, the rate on such CD
Rate Interest Determination Date for negotiable United States
dollar certificates of deposit of the Index Maturity specified
in the applicable Floating Interest Rate notice as published in
Composite Quotations under the heading "Certificates of
Deposit." If such rate is not yet published in either H.15(519)
or Composite Quotations by 3:00 p.m., New York City time, on the
related Calculation Date, then the CD Rate on such CD Rate
Interest Determination Date shall be calculated by the
Calculation Agent and shall be the arithmetic mean of the
secondary market offered rates as of 10:00 a.m., New York City
time, on such CD Rate Interest Determination Date, of three
leading nonbank dealers in negotiable United States dollar
certificates of deposit in the City of New York (which may
include the Remarketing Agent or its affiliates) selected by the
Calculation Agent, after consultation with the Company, for
negotiable United States dollars certificates of deposit of
major United States money center banks for negotiable
certificates of deposit with a remaining maturity closest to the
Index Maturity specified in the applicable Floating Interest
Rate Notice in an amount that is representative for a single
transaction in that market at that time; provided, however, that
if the dealers so selected by the Calculation Agent are not
quoting as mentioned in this sentence, the CD Rate determined as
of such CD Rate Interest Determination Date will be the CD Rate
in effect on such CD Rate Interest Determination Date.
(2) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as the
"CMT Rate," the CMT Rate shall mean, with respect to any
Interest Determination Date relating to a Note for which the
interest rate is determined with reference to the CMT Rate (a
"CMT Rate Interest Determination Date"), the rate displayed on
the Designated CMT Telerate Page under the caption "...Treasury
Constant Maturities ... Federal Reserve Board Release H.15 ...
Mondays Approximately 3:45 P.M.," under the column for the
Designated CMT Maturity Index for (i), if the Designated CMT
Telerate Page is 7055, the rate on such CMT Rate Interest
Determination Date and (ii) if the Designated CMT Telerate Page
is 7052, the weekly or monthly average, as specified in the
Floating Interest Rate Notice, for the week or the month, as
applicable, ended immediately preceding the week or the month,
as applicable, in which the related CMT Rate Interest
Determination Date occurs. If such rate is no longer displayed
on the relevant page or is not displayed by 3:00 p.m., New York
City time, on the related Calculation Date, then the CMT Rate
for such CMT Rate Interest Determination Date shall be such
treasury constant maturity rate for the Designated CMT Maturity
Index as published in H.15(519). If such rate is no longer
published or is not published by 3:00 p.m., New York City time,
on the related Calculation Date, then the CMT Rate on such CMT
Rate Interest Determination Date shall be such treasury constant
maturity rate for the Designated CMT Maturity Index (or other
United States Treasury rate for the Designated CMT Maturity
Index) for the CMT Rate Interest Determination Date with respect
to such Interest Reset Date as may then be published by either
the Board of Governors of the Federal Reserve System or the
United States Department of the Treasury that the Calculation
Agent determines to be comparable to the rate formerly displayed
on the Designated CMT Telerate Page and published in H.15(519).
If such information is not provided by 3:00 p.m., New York City
time, on the related Calculation Date, then the CMT Rate on the
CMT Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be a yield to maturity, based on the
arithmetic mean of the secondary market closing offer side
prices as of approximately 3:30 p.m., New York City time, on
such CMT Rate Interest Determination Date reported, according to
their written records, by three leading primary United States
government securities dealers each, a "Reference Dealer") in the
City of New York (which may include the Remarketing Agent or its
affiliates) selected by the Calculation Agent after consultation
with the Company (from five such Reference Dealers selected by
the Calculation Agent, after consultation with the Company, and
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event
of equality, one of the lowest)), for the most recently issued
direct noncallable fixed rate obligations of the United States
("Treasury Notes") with an original maturity of approximately
the Designated CMT Maturity Index and a remaining term to
maturity of not less than such Designated CMT Maturity Index
minus one year. If the Calculation Agent is unable to obtain
three such Treasury Note quotations, the CMT Rate on such CMT
Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be a yield to maturity based on the
arithmetic mean of the secondary market offer side prices as of
approximately 3:30 p.m., New York City time, on such CMT Rate
Interest Determination Date of three Reference Dealers in the
City of New York (from five such Reference Dealers selected by
the Calculation Agent, after consultation with the Company, and
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event
of equality, one of the lowest)), for Treasury Notes with an
original maturity of the number of years that is the next
highest to the Designated CMT Maturity Index and a remaining
term to maturity closest to the Designated CMT Maturity Index
and in an amount of at least U.S. $100 million. If three or
four (and not five) of such Reference Dealers are quoting as
described above, then the CMT Rate shall be based on the
arithmetic mean of the offer prices obtained and neither the
highest nor the lowest of such quotes shall be eliminated;
provided, however, that if fewer than three Reference Dealers so
selected by the Calculation Agent, after consultation with the
Company, are quoting as mentioned herein, the CMT Rate
determined as of such CMT Rate Interest Determination Date shall
be the CMT Rate in effect on such CMT Rate Interest
Determination Date. If two Treasury Notes with an original
maturity as described in the second preceding sentence have
remaining terms to maturity equally close to the Designated CMT
Maturity Index, the Calculation Agent, after consultation with
the Company, shall obtain from five Reference Dealers quotations
for the Treasury Note with the shorter remaining term to
maturity.
(3) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as the
"Federal Funds Rate," the Federal Funds Rate shall mean, with
respect to any Interest Determination Date relating to a Note
for which the interest rate is determined with reference to the
Federal Funds Rate (a "Federal Funds Rate Interest Determination
Date"), the rate on such date for United States dollar federal
funds as published in H.15(519) under the heading "Federal Funds
(Effective)" or, if not published by 3:00 p.m., New York City
time, on the Calculation Date, the rate on such Federal Funds
Rate Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate." If
such rate is not published in either H.15(519) or Composite
Quotations by 3:00 p.m., New York City time, on the related
Calculation Date, then the Federal Funds Rate on such Federal
Funds Rate Interest Determination Date shall be calculated by
the Calculation Agent and shall be the arithmetic mean of the
rates for the last transaction in overnight United States dollar
federal funds arranged by three leading brokers of federal funds
transactions in The City of New York (which may include the
Remarketing Agent or its affiliates) selected by the Calculation
Agent after consultation with the Company, prior to 9:00 a.m.,
New York City time, on such Federal Funds Rate Interest
Determination Date; provided, however, that if the brokers so
selected by the Calculation Agent are not quoting as mentioned
in this sentence, the Federal Funds Rate determined as of such
Federal Funds Rate Interest Determination Date shall be the
Federal Funds Rate in effect on such Federal Funds Rate Interest
Determination Date.
(4) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as
"LIBOR," LIBOR shall mean the rate determined by the Calculation
Agent as of the applicable Interest Determination Date (a "LIBOR
Interest Determination Date") in accordance with the following
provisions:
(i) If (a) "LIBOR Reuters" is specified in the
applicable Floating Interest Rate Notice, the
arithmetic mean of the offered rates (unless the
Designated LIBOR Page by its terms provides only for a
single rate, in which case such single rate will be
used) for deposits in the Index Currency having the
Index Maturity specified in the applicable Floating
Interest Rate Notice, commencing on the applicable
Interest Reset Date, that appear (or, if only a single
rate is required as aforesaid, appears) on the
Designated LIBOR Page as of 11:00 a.m., London time,
on such LIBOR Interest Determination Date, or (b)
"LIBOR Telerate" is specified in the applicable
Floating Interest Rate Notice, or if neither "LIBOR
Reuters" nor "LIBOR Telerate" is specified in the
applicable Floating Interest Rate Notice as the method
for calculating LIBOR, the rate for deposits in the
Index Currency having the Index Maturity specified in
the applicable Floating Interest Rate Notice,
commencing on such Interest Reset Date, that appears
on the Designated LIBOR Page as of 11:00 a.m., London
time, on such LIBOR Interest Determination Date. If
fewer than two such offered rates appear, or if no
such rate appears, as applicable, LIBOR on such LIBOR
Interest Determination Date will be determined in
accordance with the provisions described in clause
(ii) below.
(ii) With respect to a LIBOR Interest Determination Date on
which fewer than two offered rates appear, or no rate appears,
as the case may be, on the Designated LIBOR Page as specified in
clause (i) above, the Calculation Agent shall request the
principal London offices of each of four major reference banks
in the London interbank market, as selected by the Calculation
Agent, after consultation with the Company, to provide the
Calculation Agent with its offered quotation for deposits in the
Index Currency for the period of the Index Maturity specified in
the applicable Floating Interest Rate Notice, commencing on the
applicable Interest Reset Date, to prime banks in the London
interbank market at approximately 11:00 a.m., London time, on
such LIBOR Interest Determination Date and in a principal amount
that is representative for a single transaction in such Index
Currency in such market at such time. If at least two such
quotations are so provided, then LIBOR on such LIBOR Interest
Determination Date shall be the arithmetic mean of such
quotations. If fewer than two such quotations are so provided,
then LIBOR on such LIBOR Interest Determination Date shall be
the arithmetic mean of the rates quoted at approximately 11:00
a.m., in the applicable Principal Financial Center, on such
LIBOR Interest Determination Date by three major banks in such
Principal Financial Center selected by the Calculation Agent,
after consultation with the Company, for loans in the Index
Currency to leading European banks, having the Index Maturity
specified in the applicable Floating Interest Rate Notice and in
a principal amount that is representative for a single
transaction in such Index Currency in such market at such time;
provided, however, that if the banks so selected by the
Calculation Agent are not quoting as mentioned in this sentence,
LIBOR determined as of such LIBOR Interest Determination Date
shall be LIBOR in effect on such LIBOR Interest Determination
Date.
(5) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as the
"Prime Rate," Prime Rate shall mean, with respect to any
Interest Determination Date relating to a Note for which the
interest rate is determined with reference to the Prime Rate (a
"Prime Rate Interest Determination Date"), the rate on such date
as such rate is published in H.15(519) under the heading "Bank
Prime Loan." If such rate is not published prior to 3:00 p.m.,
New York City time, on the related Calculation Date, then the
Prime Rate shall be the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters
Screen U.S. PRIME 1 Page (as defined below) as such bank's prime
rate or base lending rate as in effect for such Prime Rate
Interest Determination Date. If fewer than four such rates
appear on the Reuters Screen U.S. PRIME 1 Page for such Prime
Rate Interest Determination Date, the Prime Rate shall be the
arithmetic mean of the prime rates quoted on the basis of the
actual number of days in the year divided by a 360-day year as
of the close of business on such Prime Rate Interest
Determination Date by four major money center banks (which may
include the Calculation Agent) in the City of New York selected
by the Calculation Agent, after consultation with the Company.
If fewer than four such quotations are so provided, the Prime
Rate shall be the arithmetic mean of four prime rates quoted on
the basis of the actual number of days in the year divided by a
360-day year as of the close of business on such Prime Rate
Interest Determination Date as furnished in the City of New York
by the major money center banks, if any, that have provided such
quotations and by as many substitute banks or trust companies
(which may include the Calculation Agent) as necessary in order
to obtain four such prime rate quotations, provided such
substitute banks or trust companies are organized and doing
business under the laws of the United States, or any State
thereof, have total equity capital of at least U.S. $500 million
and are each subject to supervision or examination by Federal or
State authority, selected by the Calculation Agent, after
consultation with the Company, to provide such rate or rates;
provided, however, that if the banks or trust companies so
selected by the Calculation Agent are not quoting as mentioned
in this sentence, the Prime Rate determined as of such Prime
Rate Interest Determination Date shall be the Prime Rate in
effect on such Prime Rate Interest Determination Date.
(6) If an Interest Rate Basis for any Note is
specified in the applicable Floating Interest Rate Notice as the
"Treasury Rate," Treasury Rate shall mean, with respect to any
Interest Determination Date relating to a Note for which the
interest rate is determined with reference to the Treasury Rate
(a "Treasury Rate Interest Determination Date"), as the rate
from the auction held on such Treasury Rate Interest
Determination Date (the "Auction") of direct obligations of the
United States ("Treasury Bills") having the Index Maturity
specified in the applicable Floating Interest Rate Notice, as
such rate is published in H.15(519) under the heading "Treasury
Bills-auction average (investment)" or, if not published by 3:00
p.m., New York City time, on the related Calculation Date, the
auction average rate of such Treasury Bills (expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) as otherwise announced
by the United States Department of the Treasury. In the event
that the results of the Auction of Treasury Bills having the
Index Maturity specified in the applicable Floating Interest
Rate Notice are not reported as provided above by 3:00 p.m., New
York City time, on such Calculation Date, or if no such Auction
is held, then the Treasury Rate shall be calculated by the
Calculation Agent, and will be a yield to maturity (expressed as
a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) of the arithmetic mean
of the secondary market bid rates, as of approximately 3:30
p.m., New York City time, on such Treasury Rate Interest
Determination Date, of three leading primary United States
government securities dealers (which may include the Remarketing
Agent or its affiliates) selected by the Calculation Agent,
after consultation with the Company, for the issue of Treasury
Bills with a remaining maturity closest to the Index Maturity
specified in the applicable Floating Interest Rate Notice;
provided, however, that if the dealers so selected by the
Calculation Agent are not quoting as mentioned in this sentence,
the Treasury Rate determined as of such Treasury Rate Interest
Determination Date shall be the Treasury Rate in effect on such
Treasury Rate Interest Determination Date.
Section 207. Conversion Between Interest Rate Modes by the
Company
The Company may, at its option, convert the Interest Rate
Mode of the Notes upon (i) any Interest Rate Adjustment Date,
(ii) election of a Callholder to remarket the Notes, subject to
the provisions of Section 305 hereof, or (iii) failure of the
SPUR Agent to purchase the Notes on the applicable REPS
Remarketing Date as described in Section 304 hereof, in each
case in accordance with the procedures provided for in this
Section.
(a) Conversion Between Commercial Paper Term Periods.
Each Note in a Commercial Paper Term Period may be remarketed
into the same Interest Rate Period or converted at the option of
the Company to a different Commercial Paper Term Period on any
Interest Rate Adjustment Date upon either receipt by the
Remarketing Agent and the Trustee of a notice, which will be
submitted promptly confirmed in writing (which includes
facsimile or appropriate electronic media), from the Company (a
"Conversion Notice") prior to 9:30 a.m., New York City time, or
the remarketing of such Note, whichever occurs later, on such
Interest Rate Adjustment Date.
(b) Conversion from the Commercial Paper Term Mode to the
Long Term Rate Mode or the REPS Mode. Each Note in the
Commercial Paper Term Mode may be converted at the option of the
Company to the Long Term Rate Mode or the REPS Mode on any
Interest Rate Adjustment Date upon receipt not less than ten
(10) days prior to such Interest Rate Adjustment Date by the
Remarketing Agent and the Trustee of a Conversion Notice from
the Company.
(c) Conversion Between Long Term Rate Periods or from the
Long Term Rate Mode or the REPS Mode to the Commercial Paper
Term Mode, Long Term Rate Mode or the REPS Mode. Each Note in a
Long Term Rate Period may be remarketed in the same Interest
Rate Period or converted at the option of the Company to a
different Long Term Rate Period or from the Long Term Rate Mode
to the Commercial Paper Term Mode or the REPS Mode, or from the
REPS Mode to a different REPS Mode or to the Long Term Rate Mode
or the Commercial Paper Term Mode, on any Interest Rate
Adjustment Date for such Note upon receipt by the Trustee and
the Remarketing Agent for such Note of a Conversion Notice from
the Company not less than ten (10) days prior to such Interest
Rate Adjustment Dates; provided that the notice required for
conversion from the initial REPS Mode shall not be required
until the latest of the day after the Initial Callholder
notifies the Company that it will not purchase the Notes for
remarketing, the day the Initial Callholder fails to so purchase
the Notes or the day the Company elects to convert the Notes to
a new Interest Rate Mode after the Initial Callholder has
elected to remarket the Notes.
(d) Conversion Notice. Each Conversion Notice must state
each Note to which it relates and the new Interest Rate Mode (if
applicable), the new Interest Rate Period, the date of the
applicable conversion (the "Conversion Date") and, with respect
to any Long Term Rate Period, any optional redemption or
repayment terms for each such Note.
(e) Revocation or Change of Conversion Notice or Floating
Interest Rate Notice. The Company may, upon written notice
received by the Trustee and the applicable Remarketing Agent,
revoke any Conversion Notice or Floating Interest Rate Notice or
change the Interest Rate Mode to which such Conversion Notice
relates or change any Floating Interest Rate Notice up to 9:30
a.m., New York City time, on the Conversion Date, subject to the
limitation set forth in subsection (f) of this Section. If the
Company revokes a Conversion Notice or the Trustee and the
Remarketing Agent fail to receive a Conversion Notice from the
Company by the specified date in advance of the Interest Rate
Adjustment Date for a Note, the Note shall be converted
automatically to the Weekly Rate Period.
(f) Limitation on Conversion, Change of Conversion Notice
or Floating Interest Rate Notice and Revocation.
Notwithstanding the foregoing subsections (a), (b), (c), (d) and
(e), the Company may not, without the consent of the applicable
Remarketing Agent, convert any Note or revoke or change any
Conversion Notice or Floating Interest Rate Notice at or after
the time at which such Remarketing Agent has determined the
interest rate, or Spread (if any) and Spread Multiplier (if
any), for any Note being remarketed (i.e., the time at which
such Note has been successfully remarketed, subject to
settlement on the related Interest Rate Adjustment Date). The
Remarketing Agent may advise the Company of indicative rates
from time to time, or at any time upon the request of the
Company, prior to making such determination of the interest
rate, Spread or Spread Multiplier, as the case may be.
Section 208. Automatic Tender of Notes on the Interest
Rate Adjustment Date
Each Note shall be automatically tendered for purchase, or
deemed tendered for purchase, on each Interest Rate Adjustment
Date relating thereto. Notes shall be purchased or redeemed on
the Interest Rate Adjustment Date relating thereto as described
in Section 209 or 210 hereof.
Section 209. Remarketing
(a) Appointment of Remarketing Agent. In connection with
the conversion by the Company of any Note as set forth in
Section 207 hereof, the Company shall enter into a remarketing
agreement with a Remarketing Agent on or prior to the
remarketing of such Notes, which Remarketing Agent shall be
responsible for the remarketing of such Notes. When any Note is
tendered under Section 208 hereof to the Remarketing Agent for
remarketing, the Remarketing Agent will use its reasonable
efforts to remarket such Note on behalf of the Beneficial Owner
thereof at a price equal to 100% of the principal amount
thereof. The Remarketing Agent may purchase tendered Notes for
its own account in a remarketing, but will not be obligated to
do so. The Company may offer to purchase Notes in a
remarketing, provided that the interest rate established with
respect to Notes in such remarketing is not different from the
interest rate that would have been established if the Company
had not purchased such Notes. Any Notes for which the Company
shall have given a notice of redemption to the Trustee and the
Remarketing Agent will not be considered in a remarketing.
(b) Remarketing Procedures. With respect to each Note for
which there is to be established an interest rate from time to
time by a Remarketing Agent responsible for the remarketing
thereof, such interest rate shall be set in accordance with the
procedures of paragraphs (i) and (ii) below.
(i) Determination of Interest Rate. By 11:00 a.m.,
New York City time, on the Interest Rate Adjustment Date for any
Note, the applicable Remarketing Agent will determine the
interest rate for such Note being remarketed to the nearest one
hundred thousandth (0.00001) of one percent per annum for the
next Interest Rate Period in the case of a fixed interest rate,
and the Spread (if any) and Spread Multiplier (if any) in the
case of a floating interest rate; provided, that between 11:00
a.m., New York City time, and 11:50 a.m., New York City time,
the Remarketing Agent and the Standby Remarketing Agent, if any,
will use their reasonable efforts to determine the interest rate
for any Notes not successfully remarketed as of the applicable
deadline specified in this paragraph. In determining the
applicable interest rate for such Note and other terms, such
Remarketing Agent will, after taking into account market
conditions as reflected in the prevailing yields on fixed and
variable rate taxable debt securities, (i) consider the
principal amount of all Notes tendered or to be tendered on such
date and the principal amount of such Notes prospective
purchasers are or may be willing to purchase and (ii) contact,
by telephone or otherwise, prospective purchasers and ascertain
the interest rates therefor at which they would be willing to
hold or purchase such Notes.
(ii) Notification of Results; Settlement. By 12:30
p.m., New York City time, on the Interest Rate Adjustment Date
of any Notes, the applicable Remarketing Agent will notify the
Company and the Trustee in writing (which may include facsimile
or other electronic transmission), of (i) the interest rate or,
in the case of a floating interest rate, the initial interest
rate, the Spread and Spread Multiplier and the initial Interest
Reset Date, applicable to such Notes for the next Interest Rate
Period, (ii) the Interest Rate Adjustment Date, (iii) the
Interest Payment Dates for any Notes in the Commercial Paper
Term Mode (if other than the Interest Rate Adjustment Date), the
Long Term Rate Mode or the REPS Mode, (iv) the optional
redemption terms, if any, and early remarketing terms, if any,
in the case of a remarketing into a Long Term Rate Period, (v)
the aggregate principal amount of tendered Notes and (vi) the
aggregate principal amount of such tendered Notes that such
Remarketing Agent was able to remarket, at a price equal to 100%
of the principal amount thereof plus accrued interest, if any.
Immediately after receiving such notice and, in any case, not
later than 1:30 p.m., New York City time, the Trustee will
transmit such information and any other settlement information
required by the Depositary, to the extent such information has
been provided to the Trustee, to the Depositary in accordance
with the Depositary's procedures as in effect from time to time.
By telephone at approximately 1:00 p.m., New York City
time, on such Interest Rate Adjustment Date, the applicable
Remarketing Agent will advise each purchaser of Notes (or the
DTC Participant of each such purchaser who it is expected in
turn will advise such purchaser) of the principal amount of such
Notes that such purchaser is to purchase.
Each purchaser of Notes in a remarketing will be required
to give instructions to its DTC Participant to pay the purchase
price therefor in same day funds to the applicable Remarketing
Agent against delivery of the principal amount of such Notes by
book-entry through the Depositary by 3:00 p.m., New York City
time, on the Interest Rate Adjustment Date.
All tendered Notes will be automatically delivered to the
account of the Trustee (or such other account meeting the
requirements of the Depositary's procedures as in effect from
time to time), by book-entry through the Depositary against
payment of the purchase price or redemption price therefor, on
the Interest Rate Adjustment Date relating thereto.
The applicable Remarketing Agent will make, or cause the
Trustee to make, payment to the DTC Participant of each
tendering Beneficial Owner of Notes subject to a remarketing, by
book-entry through the Depositary by the close of business on
the Interest Rate Adjustment Date against delivery through the
Depositary of such Beneficial Owner's tendered Notes, of the
purchase price for tendered Notes that have been sold in the
remarketing. If any such Notes were purchased pursuant to a
Special Mandatory Purchase, subject to receipt of funds from the
Company or, if applicable, an institution providing credit
support, as the case may be, the Trustee will make such payment
of the purchase price of such Notes plus accrued interest, if
any, to such date.
The transactions described above for a remarketing of any
Notes will be executed on the Interest Rate Adjustment Date for
such Notes through the Depositary in accordance with the
procedures of the Depositary, and the accounts of the respective
the DTC Participants will be debited and credited and such Notes
delivered by book-entry as necessary to effect the purchases and
sales thereof, in each case as determined in the related
remarketing.
Except as otherwise set forth in Section 210 hereof, any
Notes tendered in a remarketing will be purchased solely out of
the proceeds received from purchasers of such Notes in such
remarketing, and none of the Trustee, the applicable Remarketing
Agent, any Standby Remarketing Agent or the Company will be
obligated to provide funds to make payment upon any Beneficial
Owner's tender in a remarketing.
Although tendered Notes will be subject to purchase by a
Remarketing Agent in a remarketing, such Remarketing Agent and
any Standby Remarketing Agent will not be obligated to purchase
any such Notes.
The settlement and remarketing procedures described above,
including provisions for payment by purchasers of tendered Notes
or for payment to selling Beneficial Owners of tendered Notes,
may be modified to the extent required by the Depositary. In
addition, each Remarketing Agent may, in accordance with the
terms of the Indenture, modify the settlement and remarketing
procedures set forth above in order to facilitate the settlement
and remarketing process.
As long as the Depositary's nominee holds the certificates
representing the Notes in the book-entry system of the
Depositary, no certificates for such Notes will be delivered by
any selling Beneficial Owner to reflect any transfer of Notes
effected in any remarketing.
The Trustee shall confirm to the Depositary the interest
rate for the following Interest Rate Period in accordance with
the Depositary's procedures as in effect from time to time.
The interest rate announced by the applicable Remarketing
Agent, absent manifest error, shall be binding and conclusive
upon the Beneficial Owners, the Company and the Trustee.
(c) Failed Remarketing. Notes not successfully remarketed
will be subject to Special Mandatory Purchase by the Company as
set forth in Section 210 hereof.
Section 210. Purchase and Redemption of Notes
(a) Special Mandatory Purchase. Subject to certain
exceptions, if on any Interest Rate Adjustment Date for any
Notes, the applicable Remarketing Agent and the applicable
Standby Remarketing Agent(s) have not remarketed all such Notes,
the Notes that have not been remarketed are subject to Special
Mandatory Purchase (a "Special Mandatory Purchase") by the
Company. The Company is obligated to pay all accrued and unpaid
interest, if any, on unremarketed Notes to such Interest Rate
Adjustment Date. Payment of the principal amount of
unremarketed Notes by the Company, and payment of accrued and
unpaid interest, if any, by the Company, will be made by deposit
of same-day funds with the Trustee (or such other account
meeting the requirements of the Depositary's procedures as in
effect from time to time) irrevocably in trust for the benefit
of the Beneficial Owners of Notes subject to Special Mandatory
Purchase by 3:00 p.m., New York City time, on such Interest Rate
Adjustment Date.
Failure by the Company to purchase Notes pursuant to a
Special Mandatory Purchase will constitute an Event of Default
under the Indenture as set forth in Section 401 hereof in which
event the date of such failure shall constitute a date of
Maturity for such Notes and the principal thereof may be
declared due and payable in the manner and with the effect
provided in the Indenture. Following such failure to pay
pursuant to a Special Mandatory Purchase, such Notes will bear
interest at the Special Interest Rate as provided for in Section
205 hereof.
(b) Optional Redemption on any Interest Rate Adjustment
Date. Each Note will be subject to redemption at the option of
the Company in whole or in part on any Interest Rate Adjustment
Date relating thereto without notice to the holders thereof at a
redemption price equal to 100% of the principal amount thereof.
(c) Redemption While Notes are in the Long Term Rate Mode.
Any Notes in the Long Term Rate Mode are subject to redemption
at the option of the Company at the times and upon the terms
specified at the time of conversion to or within such Long Term
Rate Mode.
(d) Allocation. Except in the case of a Special Mandatory
Purchase, if the Notes are to be redeemed in part, the
Depositary, after receiving notice of redemption specifying the
aggregate principal amount of Notes to be so redeemed, will
determine by lot (or otherwise in accordance with the procedures
of the Depositary) the principal amount of such Notes to be
redeemed from the account of each DTC Participant. After making
its determination as described above, the Depositary will give
notice of such determination to each DTC Participant from whose
account such Notes are to be redeemed. Each such DTC
Participant, upon receipt of such notice will in turn determine
the principal amount of Notes to be redeemed from the accounts
of the Beneficial Owners of such Notes for which it serves as
DTC Participant, and give notice of such determination to the
Remarketing Agent.
Section 211. Form and Other Terms of the Notes
(a) Attached hereto as Exhibit A is the form of Note,
which form is hereby established as the form in which Notes may
be issued bearing interest at the Initial Interest Rate or in
the Commercial Paper Term Mode, the Long Term Rate Mode or the
REPS Mode. Annex A to Exhibit A is deemed to be a part of such
Note and such Annex may be changed upon the mutual agreement of
the Company and the Trustee to reflect changes occasioned by
remarketings.
(b) Subject to (a) above, any Note may be issued in such
other form as may be provided by, or not inconsistent with, the
terms of the Original Indenture and this First Supplemental
Indenture.
ARTICLE THREE
The REPS Mode
Section 301. Applicability of Article
The provisions of this Article Three shall apply to any
Note in the REPS Mode. To the extent that any provision of this
Article Three conflicts with any provision of Article Two, the
provisions set forth in this Article Three shall govern.
Section 302. Initial REPS Rate Period
The Notes shall be issued initially in a REPS Mode with
respect to which the Company shall have on the Original Issue
Date entered into a REPS Remarketing Agreement. With respect to
Notes within a REPS Rate Period commencing on the Original Issue
Date, references in this Article Three to (i) the Callholder and
REPS Remarketing Date shall mean the Initial Callholder and the
Initial REPS Remarketing Date and (ii) the Interest Rate
Adjustment Date upon which the REPS Rate Period commences shall
mean the Original Issue Date.
Section 303. Interest to REPS Remarketing Date
Each Note in the REPS Mode will bear interest at the annual
interest rate established by the Callholder from, and including,
the Interest Rate Adjustment Date commencing the Interest Rate
Period for the REPS Mode to, but excluding, the REPS Remarketing
Date. Such interest rate will be the minimum rate of interest
and, in the case of a floating interest rate, Spread (if any)
and Spread Multiplier (if any) necessary in the judgment of such
Callholder to produce a par bid in the secondary market for such
Note on the date the interest rate is established. The
designated REPS Remarketing Date shall be an Interest Payment
Date within such Interest Rate Period.
Section 304. Tender to and Remarketing by the Callholder
The obligations of the SPUR Agent set forth herein shall be
performed under the applicable REPS Remarketing Agreement.
(a) Mandatory Tender. Provided that the Callholder gives
notice to the Company and the Trustee on or before the
Notification Date of its intention to purchase the Notes for
remarketing, each Note will be automatically tendered, or deemed
tendered, to the Callholder for remarketing at the REPS Interest
Rate on the REPS Remarketing Date, except in the circumstances
described in subsection (b)(2) and Section 305 below with regard
to failure of the Callholder to purchase the Notes. The
purchase price for the tendered Notes to be paid by the
Callholder will equal 100% of the principal amount thereof.
When the Notes are tendered for remarketing, the Callholder may
remarket the Notes for its own account at varying prices to be
determined by the Callholder at the time of each sale. From and
including the REPS Remarketing Date to, but excluding, the next
succeeding Interest Rate Adjustment Date, the Notes will bear
interest at the REPS Interest Rate. If the Callholder elects to
remarket the Notes, the obligation of the Callholder to purchase
the Notes on the REPS Remarketing Date is subject to the
conditions set forth in the applicable REPS Remarketing
Agreement.
(b) Remarketing. The remarketing of the notes purchased by
Callholder under the REPS Remarketing Agreement shall be carried
out in accordance with the following procedures:
(1) The REPS Interest Rate. Subject to the
Callholder's election to remarket the Notes as provided in
subsection (a) above, the REPS Interest Rate shall be determined
by the Callholder by 3:30 p.m., New York City time, on the third
Business Day immediately preceding the REPS Remarketing Date
(the "Determination Date") to the nearest one hundred-thousandth
(0.00001) of one percent per annum and will be equal to the Base
Rate established by the Callholder, after consultation with the
Company, at or prior to the commencement of the REPS Mode (the
"Base Rate"), plus the Applicable Spread, which will be based on
the Dollar Price of the Notes.
(2) Notification of Results; Settlement. Provided
the Callholder has previously notified the Company and the
Trustee on the Notification Date of its intention to purchase
all tendered Notes on the REPS Remarketing Date, the Callholder
will notify the Company, the Trustee and the Depositary by
telephone, confirmed in writing, by 4:00 p.m., New York City
time, on the Determination Date, of the REPS Interest Rate.
All of the tendered Notes will be automatically delivered
to the account of the Trustee, by book-entry through the
Depositary pending payment of the purchase price therefor, on
the REPS Remarketing Date.
In the event that the Callholder purchases the tendered
Notes on the REPS Remarketing Date, the Callholder will make or
cause the Trustee to make payment to the DTC Participant of each
tendering Beneficial Owner of Notes, by book-entry through the
Depositary by the close of business on the REPS Remarketing Date
against delivery through the Depositary of such Beneficial
Owner's tendered Notes. If the Callholder does not purchase all
of the Notes on the REPS Remarketing Date, the Company may
attempt to convert the Notes to a new Interest Rate Mode, such
interest rate to be determined as provided for in Section 205
hereof, and settlement will be effected as described in this
Section 304(b). In any case, the Company will make or cause the
Trustee to make payment of interest to each Beneficial Owner of
Notes due on the REPS Remarketing Date by book-entry through the
Depositary by the close of business on the REPS Remarketing
Date.
The transactions in this subsection (b)(2) hereof will be
executed on the REPS Remarketing Date through the Depositary in
accordance with the procedures of the Depositary, and the
accounts of the respective DTC Participants will be debited and
credited and the Notes delivered by book-entry as necessary to
effect the purchases and sales thereof.
Transactions involving the sale and purchase of Notes
remarketed by the Callholder on and after a REPS Remarketing
Date will settle in immediately available funds through the
Depositary's Same-Day Funds Settlement System.
The tender and settlement procedures described above,
including provisions for payment by purchasers of Notes in the
remarketing or for payment to selling Beneficial Owners of
tendered Notes, may be modified to the extent required by the
Depositary or to the extent required to facilitate the tender
and remarketing of Notes in certificated form, if the book-entry
system is no longer available for the Notes at the time of the
remarketing. In addition, the Callholder may, in accordance
with the terms of the Indenture, modify the tender and
settlement procedures set forth above in order to facilitate the
tender and settlement process.
As long as the Depositary's nominee holds the certificates
representing any Notes in the book-entry system of the
Depositary, no certificates for such Notes will be delivered by
any selling Beneficial Owner to reflect any transfer of such
Notes effected in the remarketing.
Section 305. Conversion or Redemption Following Election
by the Callholder to Remarket
(a) If the Callholder elects to remarket the Notes on the
REPS Remarketing Date, the Notes will be subject to mandatory
tender to the Callholder for remarketing on such date, in each
case subject to the conditions set forth in Section 304 hereof,
and to the Company's right to either convert the Notes to a new
Interest Rate Mode on the REPS Remarketing Date or to redeem the
Notes from the Callholder, in each case as described in the next
sentence. The Company will notify the Callholder and the
Trustee, not later than the Business Day immediately preceding
the Determination Date, if the Company irrevocably elects to
exercise its right to either convert the Notes to a new Interest
Rate Mode, or to redeem the Notes in whole, but not in part,
from the Callholder at the Optional Redemption Price, in each
case on the REPS Remarketing Date.
(b) In the event that the Company irrevocably elects to
convert the Notes to a new Interest Rate Mode, then as of the
REPS Remarketing Date the Notes will cease to be in the REPS
Mode, the REPS Remarketing Date will constitute an Interest Rate
Adjustment Date, and the Notes shall be subject to remarketing
on such date by a Remarketing Agent appointed in the Commercial
Paper Term Mode or the Long Term Rate Mode or a new REPS Mode
established in accordance with the procedures set forth in
Section 207 hereof; provided that, in such case, the notice
period required for conversion shall be the period commencing on
the Determination Date. In such case, the Company shall pay to
the Callholder the excess of the Dollar Price of the Notes over
100% of the principal amount of the Notes in same-day funds by
wire transfer to an account designated by the Callholder on the
REPS Remarketing Date.
(c) In the event that the Company irrevocably elects to
redeem the Notes, the "Optional Redemption Price" shall be the
greater of either (i) 100% of the principal amount of the Notes
or (ii) the Dollar Price, plus in either case accrued and unpaid
interest from the REPS Remarketing Date on the principal amount
being redeemed to the date of redemption. If the Company elects
to redeem the Notes, it shall pay the redemption price therefor
in same-day funds by wire transfer to an account designated by
the Callholder on the REPS Remarketing Date.
(d) If notice has been given as provided in the Indenture
and funds for the redemption of any Notes called for redemption
shall have been made available on the redemption date referred
to in such notice, such Notes shall cease to bear interest on
the date fixed for such redemption specified in such notice and
the only right of the Callholder from and after the redemption
date shall be to receive payment of the Optional Redemption
Price upon surrender of such Notes in accordance with such
notice.
ARTICLE FOUR
Additional Events of Default with Respect to the Notes
Section 401. Definition
All of the events specified in clauses (1), (2) and (4)
through (6) of Section 501(a) of the Original Indenture shall be
"Events of Default" with respect to the Notes. In addition, the
following event that shall have occurred and be continuing shall
be an additional Event of Default with respect to each series of
Notes: (7) default in the payment of the purchase price with
respect to the Special Mandatory Purchase on the applicable
Interest Rate Adjustment Date in accordance with Section 210(a)
hereof.
ARTICLE FIVE
Authentication and Delivery of the Notes
Section 501. Authentication and Delivery
As provided in and pursuant to Section 303 of the Original
Indenture, each time that the Company delivers Notes to the
Trustee or Authenticating Agent for authentication, the Company
shall deliver a Supplemental Company Order in the form of
Exhibit B to this First Supplemental Indenture for the
authentication and delivery of such Notes and the Trustee or
such Authenticating Agent shall authenticate and deliver such
Notes.
ARTICLE SIX
Supplemental Indentures
Section 601. Effect On Original Indenture
The First Supplemental Indenture is a supplement to the
Original Indenture. As supplemented by this First Supplemental
Indenture, the Original Indenture is in all respects ratified,
approved and confirmed, and the Original Indenture and this
First Supplemental Indenture shall together constitute one and
the same instrument.
ARTICLE SEVEN
Miscellaneous
Section 701. Counterparts
This First Supplemental Indenture may be executed in any
number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall
together constitute by one and the same instrument.
Section 702. Recitals
The recitals contained herein shall be taken as the
statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this First
Supplemental Indenture.
Section 703. Governing Law
This First Supplemental Indenture shall be governed by and
construed in accordance with the laws of the jurisdiction that
govern the Original Indenture and its construction.
[The balance of this page intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have caused this
First Supplemental Indenture to be duly executed and their
respective corporate seals to be hereunto affixed and attested,
all as of the date and year first written above.
TECO ENERGY, INC.
By:
Name:
Title:
[Corporate Seal]
THE BANK OF NEW YORK, AS TRUSTEE
By:
Name:
Title:
[Corporate Seal]
State of )
) SS.:
County of )
On the __________ day of ________________, 1998 before me
personally came ________________, to me known, who, being by
me duly sworn, did depose and say that he/she is ______________
of TECO ENERGY, INC., one of the corporations
described in and which executed the foregoing instrument; that
he/she knows the seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed
by authority of the Board of Directors of said corporation, and
that he/she signed his/her name thereto by like authority.
Notary Public
State of New York )
) SS.:
County of New York )
On the ________ day of __________________ 1998 before me
personally came ______________________________________ to me
known, who, being by me duly sworn, did depose and say that
he/she is ____________________________ of THE BANK OF NEW YORK,
one of the corporations described in and which executed the
foregoing instrument; that he/she knows the seal of said
corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board
of Directors of said corporation, and that he/she signed his/her
names thereto by like authority.
Notary Public
Exhibit C --
EXHIBIT A
FORM OF NOTE
Included as Exhibit 4.2 to this filing
EXHIBIT B
TECO ENERGY, INC.
REMARKETED NOTES DUE 2038
SUPPLEMENTAL COMPANY ORDER
Pursuant to Article Five of the First Supplemental
Indenture, dated as of September 1, 1998, to the Indenture,
dated as of August 17, 1998, as amended, you are instructed to
prepare and authenticate a Note, of the series identified above,
in the principal amount of $______________. The Note is being
delivered in exchange for issued and outstanding Notes of the
series identified above.
IN WITNESS WHEREOF, I have hereunto set my hand this
____ day of ________, ____.
TECO ENERGY, INC.
By:
Name:
Title:
EXHIBIT C
[TECO Energy, Inc. Letterhead]
FLOATING INTEREST RATE NOTICE
[Date]
To: [Remarketing Agent(s)]
[Address]
The Bank of New York
00000 Xxxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attention: Corporate Trust Trustee Administration
Telecopy: (000) 000-0000
Re: Remarketed Notes Due 2038 (the "Notes")
Ladies and Gentlemen:
This Floating Interest Rate Notice relates to (i)
$_______________ principal amount of the Notes (CUSIP No.
___________) and (ii) the proposed [Long Term Rate Period] [REPS
Rate Period] of the Note (the "Interest Rate Period") commencing
on ___________ and ending on ___________. Capitalized terms
used and not otherwise defined herein shall have their
respective meanings assigned to them in the Notes.
We hereby notify you that the above-referenced Notes will
bear the following floating rate terms during the Interest Rate
Period specified above:
1. The Interest Rate Basis(es) shall be:
[ ] CD Rate, where the Index Maturity will be
______________;
[ ] CMT Rate, where the Designated CMT Maturity Index will
be _____________, and the Designated CMT Telerate Page
will be ____________;
[ ] Federal Funds Rate;
[ ] LIBOR Reuters, where the Index Currency will be
___________, and the Designated LIBOR Page will be
__________;
[ ] LIBOR Telerate, where the Index Currency will be
_____________ , and the Designated LIBOR Page will be
_____________;
[ ] Prime Rate;
[ ] Treasury Rate
2. The floating interest rate will be reset as follows:
[ ] Initial Interest Reset Date will be __________ ;
[ ] Interest Reset Dates will be _____________;
[ ] Interest Reset Period will be ____________;
3. The interest will be paid as follows:
[ ] Interest Payment Dates will be _____________;
[ ] Interest Rate Period will be ____________;
[ ] Index Maturity will be _________;
[ ] Floating Rate Maximum Interest Rate will be
____________;
[ ] Floating Rate Minimum Interest Rate will be
______________.
4. Day Count Convention:
[ ] Actual/360;
[ ] Actual/Actual;
[ ] 30/360.
5. Other terms: [ ]
Each Beneficial Owner of the Note will be deemed to have
tendered such Note as of the Interest Rate Adjustment Date and
will not be entitled to further accrual of interest after the
Interest Rate Adjustment Date.
TECO ENERGY, INC.
By:
Name:
Title:
