As filed with the Securities and Exchange Commission on October 1, 2001
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Sempra Energy California 33-0732627
Sempra Energy Global
Enterprises California 33-0783483
Sempra Energy Capital Trust
II Delaware 52-6988598
Sempra Energy Capital Trust
III Delaware 52-6988599
(State or other jurisdiction (I.R.S. Employer
(Exact name of registrant of Identification)
incorporation or
as specified in its charter) organization)
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101 Ash Street
San Diego, California 92101
(619) 696-2000
(Name, address, including zip code, and telephone number,
including area code, of each registrant's principal executive offices)
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Copies to:
John R. Light, Esq.
Executive Vice President and General Counsel
101 Ash Street
San Diego, California 92101
(619) 696-2034
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Approximate date of commencement of proposed sale to the public: From time
to time after the registration statement becomes effective, as determined by
market and other conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration for the same offering. [_]
If this Form is a post-effective amended filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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Proposed maximum
aggregate Amount of
Title of each class of securities Amount to be offering Registration
to be registered registered(1)(2)(3) price(3)(4) Fee
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Debt securities, common
stock, without par value,
and preferred stock,
without par value, warrants
to purchase debt
securities, common stock or
preferred stock, securities
purchase contracts,
securities purchase units
and depositary shares of
Sempra Energy.............
Class A junior participant
preferred stock purchase
rights, without par value,
of Sempra Energy(5).......
Debt securities and warrants
to purchase debt securities
of Sempra Energy Global
Enterprises(6)............
Guarantees of debt
securities of Sempra Energy
Global Enterprises by
Sempra Energy.............
Trust preferred securities
of Sempra Energy Capital
Trust II and Sempra Energy
Capital Trust III(7)......
Guarantees of trust
preferred securities of the
Trusts by Sempra
Energy(7).................
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Total................... $2,000,000,000 $2,000,000,000 $500,000
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(1) An indeterminate principal amount or number of debt securities, common
stock, preferred stock, guarantees, warrants to purchase common stock,
preferred stock and debt securities, stock purchase contracts, stock
purchase units and depositary shares as may be issued in the event Sempra
Energy elects to offer fractional interests in preferred stock and such
indeterminate principal amounts or number of debt securities, common stock
or preferred stock as may be issued upon conversion of, or in exchange for,
or upon exercise of, or pursuant to, warrants, or convertible or
exchangeable debt securities, stock purchase contracts or stock purchase
units or preferred stock that provides for exercise or conversion into or
purchase of such securities of Sempra Energy and an indeterminate principal
amount of debt securities and warrants to purchase debt securities of
Sempra Energy Global Enterprises and an indeterminate number of trust
preferred securities of the Sempra Energy Capital Trust II and Sempra
Energy Capital Trust III as may from time to time be issued at
indeterminate prices, with an aggregate offering price not to exceed
$2,000,000,000. Debt securities may be issued and sold to the Trusts, in
which event the debt securities may later be distributed to the holders of
trust preferred securities.
(2) In the United States dollars or the equivalent thereof in any other
currency, composite currency or currency unit as shall result in an
aggregate initial offering price for all securities of $2,000,000,000.
(3) This amount represents the principal amount of any debt securities issued
at their stated principal amount, the issue price of any debt securities
issued at a discount form the stated principal amount, the issue price of
any preferred stock, warrants to purchase common stock, preferred stock and
debt securities, stock purchase contracts, stock purchase units, depositary
shares and trust preferred securities and the amount computed pursuant to
Rule 457(c) for any common stock.
(4) Estimated solely for the purpose of calculating the registration fee, which
is calculated in accordance with Rule 457(o) of the rules and regulations
under the Securities Act of 1933. Rule 457(o) permits the registration fee
to be calculated on the basis of the maxim offering price of all the
securities listed and, therefore, the table does not specify by each class
information as to the amount to be registered, the proposed maximum
offering price per unit or the proposed maximum aggregate offering price.
(5) The rights are initially carried and traded with the common stock. The
value attributable to the rights, if any, is reflected in the value of the
common stock.
(6) Also includes an indeterminate number of securities that may be issued upon
exercise, conversion or exchange of or purchase pursuant to any securities
registered hereunder that provide for conversion or exchange.
(7) Includes the rights of holders of the trust preferred securities under the
guarantees of trust preferred securities and back-up undertakings,
consisting of obligations by Sempra Energy, as set forth in the declaration
of trust, the applicable indenture and any supplemental indenture thereto,
in each case, as further described in the registration statement. No
separate consideration will be received for any guarantees or any back-up.
----------------
The registrants hereby amend this registration statement on such date or
dates as maybe necessary to delay its effective date until the registrants
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities Exchange Commission, acting pursuant
to said Section 8(1), may determine.
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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this preliminary prospectus is not complete and may be +
+changed. We not sell these securities until the registration statement filed +
+with the Securities and Exchange Commission is effective. This preliminary +
+prospectus is not an offer to sell these securities and it is not soliciting +
+an offer to buy these securities in any state where the offer of sale is not +
+permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED OCTOBER 1, 2001
PRELIMINARY PROSPECTUS
$2,000,000,000
SEMPRA ENERGY
Debt Securities, Common Stock, Preferred Stock, Guarantees, Warrants to
Purchase Debt
Securities, Common Stock and Preferred Stock, Securities Purchase Contracts,
Securities
Purchase Units and Depositary Shares
SEMPRA ENERGY GLOBAL ENTERPRISES
Debt Securities Guaranteed by Sempra Energy and Warrants to Purchase Debt
Securities
SEMPRA ENERGY CAPITAL TRUST II
SEMPRA ENERGY CAPITAL TRUST III
Trust Preferred Securities Guaranteed by Sempra Energy
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We may offer and sell the securities from time to time in one or more
offerings. This prospectus provides you with a general description of the
securities we may offer.
Each time we sell securities we will provide a supplement to this prospectus
that contains specific information about the offering and the terms of the
securities. The supplement may also add, update or change information contained
in this prospectus. You should carefully read this prospectus and the
accompanying prospectus supplement before you invest in any of our securities.
Sempra Energy
Sempra Energy may offer and sell the following securities:
. debt securities
. common stock
. preferred stock
. guarantees of debt securities and trust preferred securities
. warrants to purchase debt securities, common stock and preferred stock
. securities purchase contracts and securities purchase units
. depositary shares
Sempra Energy Global Enterprises
Sempra Energy Global Enterprises may offer and sell debt securities
guaranteed by Sempra Energy and warrants to purchase debt securities.
The Sempra Energy Trusts
Sempra Energy Capital Trust II and Sempra Energy Capital Trust III may offer
and sell trust preferred securities guaranteed by Sempra Energy.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
The date of this prospectus is , 2001.
TABLE OF CONTENTS
Page
----
ABOUT THIS PROSPECTUS..................................................... 1
FORWARD-LOOKING STATEMENTS................................................ 2
WHERE YOU CAN FIND MORE INFORMATION....................................... 2
SEMPRA ENERGY............................................................. 4
SEMPRA ENERGY GLOBAL ENTERPRISES.......................................... 4
SEMPRA ENERGY CAPITAL TRUST II AND SEMPRA ENERGY CAPITAL TRUST III........ 5
USE OF PROCEEDS........................................................... 7
RATIO OF SEMPRA ENERGY EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED
STOCK DIVIDENDS.......................................................... 7
DESCRIPTION OF SECURITIES................................................. 8
DESCRIPTION OF DEBT SECURITIES............................................ 8
DESCRIPTION OF SEMPRA ENERGY'S COMMON STOCK AND PREFERRED STOCK........... 20
DESCRIPTION OF WARRANTS................................................... 24
DESCRIPTION OF SECURITIES PURCHASE CONTRACTS AND SECURITIES
PURCHASE UNITS........................................................... 27
DESCRIPTION OF DEPOSITARY SHARES.......................................... 28
DESCRIPTION OF TRUST PREFERRED SECURITIES................................. 31
DESCRIPTION OF THE SUBORDINATED DEBT SECURITIES OF SEMPRA ENERGY PURCHASED
WITH PROCEEDS OF TRUST SECURITIES........................................ 42
DESCRIPTION OF TRUST PREFERRED SECURITIES GUARANTEES...................... 54
RELATIONSHIP AMONG TRUST PREFERRED SECURITIES, PREFERRED SECURITIES
GUARANTEES AND SUBORDINATED DEBT SECURITIES HELD BY EACH TRUST........... 56
GLOBAL SECURITIES......................................................... 56
EXPERTS................................................................... 59
VALIDITY OF THE SECURITIES AND THE GUARANTEES............................. 59
PLAN OF DISTRIBUTION...................................................... 60
ABOUT THIS PROSPECTUS
This prospectus is part of a "shelf" registration statement that we filed
with the United States Securities and Exchange Commission, or the "SEC." By
using a shelf registration statement, we may sell up to $2,000,000,000 offering
price of any combination of the securities described in this prospectus from
time to time and in one or more offerings. This prospectus only provides you
with a general description of the securities that we may offer. Each time we
sell securities, we will provide a supplement to this prospectus that contains
specific information about the terms of the securities. The supplement may also
add, update or change information contained in this prospectus. Before
purchasing any securities, you should carefully read both this prospectus and
the accompanying prospectus supplement, together with the additional
information described under the heading "Where You Can Find More Information."
This prospectus does not contain separate financial statements for Sempra
Energy Global Enterprises or Sempra Energy Capital Trust II or Sempra Energy
Capital Trust III, (collectively, the "trusts"). Sempra Energy files
consolidated financial information with the SEC that includes Sempra Energy
Global Enterprises and each of the trusts. The trusts have no historical
operations and do not have any independent function other than to issue
securities and to purchase subordinated debt securities from Sempra Energy. We
do not believe that additional financial information regarding Sempra Energy
Global Enterprises or the trusts would be useful to you.
You should rely only on the information contained or incorporated by
reference in this prospectus and in any supplement. We have not authorized any
other person to provide you with different information. If anyone provides you
with different or inconsistent information, you should not rely on it. You
should assume that the information appearing in this prospectus and the
accompanying prospectus supplement is accurate as of the date on their
respective covers. Our business, financial condition, results of operations and
prospects may have changed since that date.
1
FORWARD-LOOKING STATEMENTS
This prospectus, any accompanying prospectus supplement and the documents
they incorporate by reference may contain statements that are not historical
fact and constitute "forward-looking statements." When we use words like
"believes," "expects," "anticipates," "intends," "plans," "estimates," "may,"
"should" or similar expressions, or when we discuss our strategy or plans, we
are making forward-looking statements. Forward-looking statements are not
guarantees of performance. They involve risks, uncertainties and assumptions.
Our future results may differ materially from those expressed in these forward-
looking statements. These statements are necessarily based upon various
assumptions involving judgments with respect to the future and other risks,
including, among others:
. national, international, regional and local economic, competitive,
technological, political, legislative and regulatory conditions and
developments;
. actions by the California Public Utilities Commission, the California
State Legislature, the California Department of Water Resources and the
Federal Energy Regulatory Commission;
. capital market conditions, inflation rates, exchange rates and interest
rates;
. energy markets, including the timing and extent of changes in commodity
prices;
. weather conditions;
. business, regulatory and legal decisions;
. the pace of deregulation of retail natural gas and electricity delivery;
. the timing and success of business development efforts; and
. other uncertainties, all of which are difficult to predict and many of
which are beyond our control.
You are cautioned not to rely unduly on any forward-looking statements.
These risks and uncertainties are discussed in more detail under "Business" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" in our Annual Report on Form 10-K for the year ended December 31,
2000, our Quarterly Reports on Form 10-Q for the three-month periods ended
March 31, 2001 and June 30, 2001, and other documents on file with the SEC. You
may obtain copies of these documents as described under "Where You Can Find
More Information" in this prospectus.
WHERE YOU CAN FIND MORE INFORMATION
Available Information
Sempra Energy files reports, proxy statements and other information with the
SEC. Information filed with the SEC by Sempra Energy can be inspected and
copied at the Public Reference Room maintained by the SEC at 450 Fifth Street,
N.W., Room 1024, Washington D.C. 20549.
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Further information on the operation of the
SEC's Public Reference Room in Washington, D.C. can be obtained by calling the
SEC at 1-800-SEC-0330.
The SEC also maintains a web site that contains reports, proxy statements
and other information about issuers, such as Sempra Energy, who file
electronically with the SEC. The address of that site is http://www.sec.gov.
Sempra Energy's common stock is listed on the New York Stock Exchange (NYSE:
SRE), and reports, proxy statements and other information concerning Sempra
Energy can also be inspected at the offices of the New York Stock Exchange at
20 Broad Street, New York, New York 10005.
2
This prospectus is part of a registration statement that we filed with the
SEC. The full registration statement may be obtained from the SEC or Sempra
Energy, as indicated below. Forms of the indentures, the declarations of trust
and other documents establishing the terms of the offered securities and the
guarantees are filed as exhibits to the registration statement. Statements in
this prospectus about these documents are summaries. You should refer to the
actual documents for a more complete description of the relevant matters.
Incorporation by Reference
The rules of the SEC allow us to "incorporate by reference" information into
this prospectus, which means that we can disclose important information to you
by referring you to another document filed separately with the SEC. The
information incorporated by reference is deemed to be part of this prospectus,
and later information that we file with the SEC will automatically update and
supersede that information. The prospectus incorporates by reference the
documents set forth below that have been previously filed with the SEC. These
documents contain important information about Sempra Energy.
SEC Filings (File No. 1-14201) Period
------------------------------ ------
Annual Report on Form 10-K.......... Year ended December 31, 2000
Quarterly Reports on Form 10-Q...... Three-month periods ended March 31,
2001 and June 30, 2001
Current Reports on Form 8-K......... Filed January 24, 2001, January 30,
2001, February 16, 2001, April 27,
2001, June 19, 2001, June 29,
2001, July 16, 2001 and July 27,
2001
Registration Statement on Form 8-A.. Filed June 5, 1998
We are also incorporating by reference all additional documents that we file
with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended, between the date of this prospectus and the
termination of the offering of securities described in this prospectus.
Sempra Energy will provide without charge to each person to whom a copy of
this prospectus has been delivered a copy of any and all of these filings. You
may request a copy of these filings by writing or telephoning us at:
Sempra Energy
101 Ash Street
San Diego, California 92101
Attention: Corporate Secretary
Telephone: (619) 696-2034
3
SEMPRA ENERGY
Sempra Energy, based in San Diego, is a Fortune 500 energy services company.
We were formed in connection with a business combination of Pacific Enterprises
and Enova Corporation in which the shareholders of the two companies became our
shareholders. The combination was completed and our shares began trading in
June 1998.
Through two regulated utility subsidiaries, Southern California Gas Company
and San Diego Gas & Electric Company, we serve over 21 million consumers, the
largest customer base of any gas, electric or combination gas and electric
utility in the United States. Natural gas service is provided throughout
Southern California and portions of Central California through over 5.7 million
active meters. Electric service is provided throughout San Diego County and
portions of Orange County, both in Southern California, through over 1.2
million active meters.
Through other subsidiaries, we also provide other energy-related products
and services. These subsidiaries include Sempra Energy Solutions, Sempra Energy
Trading, Sempra Energy Resources, Sempra Energy Services Company and Sempra
Energy International. Sempra Energy Solutions is a provider of energy-related
products and services to commercial, industrial, governmental, institutional
and consumer markets. Sempra Energy Trading is a wholesale trader of physical
and financial energy products, including natural gas, power, crude oil and
associated commodities. Sempra Energy Trading serves a broad range of customer,
including electric and gas utilities, industrial and large commercial end
users, and major energy markets while specializing in high-volume transactions.
Sempra Energy Resources acquires and develops power plants for the competitive
market and operates natural gas storage, production and transportation assets.
Sempra Energy Resources' power plants use state-of-the-art, combined-cycle
power generation technology and natural gas to generate electricity for the
wholesale market and retail electric providers, including utilities, marketers
and large energy users. Sempra Energy Services Company is a provider of energy-
efficiency engineering services for government and institutional customers.
Sempra Energy International engages in energy-infrastructure projects outside
the United States. It currently has interests in companies that provide natural
gas and electricity services in Argentina, Canada, Chile, Mexico, Peru and
Uruguay.
Our principal executive offices are located at 101 Ash Street, San Diego,
California 92101 and our telephone number is (619) 696-2034.
SEMPRA ENERGY GLOBAL ENTERPRISES
Sempra Energy Global Enterprises is a wholly owned subsidiary of Sempra
Energy. It is a holding company for many of the subsidiaries of Sempra Energy
that are not subject to California utility regulation. Its principal direct and
indirect subsidiaries currently are:
. Sempra Energy Solutions, a provider of energy-related products and
services to commercial, industrial, governmental, institutional and
consumer markets. Its principal subsidiaries are Sempra Energy Trading,
Sempra Energy Resources and Sempra Energy Services Company.
. Sempra Energy Trading, a wholesale trader of physical and financial
energy products, including natural gas, power, crude oil and associated
commodities. Sempra Energy Trading serves a broad range of customers,
including electric and gas utilities, industrial and large commercial end
users, and major energy marketers. It specializes in high-volume
transactions and provides its customers with customized energy delivery
and pricing programs.
. Sempra Energy Resources, a company that acquires and develops power
plants for the competitive market and operates natural gas storage,
production and transportation assets. Sempra Energy Resources' power
plants use state-of-the-art, combined-cycle power generation technology
and natural gas to generate electricity for the wholesale market and
retail electric providers, including utilities, marketers and large
energy users.
4
. Sempra Energy Services Company, a provider of energy-efficiency
engineering services for government and institutional customers.
. Sempra Energy International, a company that engages in energy-
infrastructure projects outside the United States. It currently has
interests in companies that provide natural gas and electricity services
in Argentina, Chile, Mexico and Peru.
Sempra Energy Global Enterprises may, in the future, engage in other
businesses.
Sempra Energy Global Enterprises' offices are located at 101 Ash Street,
San Diego, California 92101 and the telephone number is (619) 696-2034.
SEMPRA ENERGY CAPITAL TRUST II AND SEMPRA ENERGY CAPITAL TRUST III
Sempra Energy created Sempra Energy Capital Trust II and Sempra Energy
Capital Trust III. Sempra Energy will file an Amended and Restated Declaration
of Trust (a "Declaration") for each trust, which will state the terms and
conditions for each trust to issue and sell its trust preferred securities and
trust common securities. A form of Declaration is filed as an exhibit to the
registration statement of which this prospectus forms a part.
Each trust exists solely to:
. issue and sell its trust preferred securities (representing undivided
beneficial interests in the trust) to investors;
. issue and sell its trust common securities (representing undivided
beneficial interests in the trust) to Sempra Energy;
. use the proceeds from the sale of its trust preferred and common
securities to purchase a series of Sempra Energy's subordinated debt
securities;
. distribute the cash payments it receives on the subordinated debt
securities it owns to the holders of its trust preferred and common
securities;
. maintain its status as a grantor trust for federal income tax purposes;
and
. engage in other activities that are necessary or incidental to these
purposes.
Sempra Energy will purchase all of the trust common securities of each
trust. The trust common securities will represent an aggregate liquidation
amount equal to at least 3% of each trust's total capitalization. The trust
preferred securities will represent the remaining portion of the trust's total
capitalization. The trust common securities will have terms substantially
identical to, and will rank equal in priority of payment with, the trust
preferred securities. However, if Sempra Energy defaults on the related
subordinated debt securities, then cash distributions and liquidation,
redemption and other amounts payable on the trust common securities will be
subordinate to the trust preferred securities in priority of payment.
The trust preferred securities will be guaranteed by Sempra Energy as
described later in this prospectus.
Sempra Energy has appointed six trustees to conduct each trust's business
and affairs:
. The Bank of New York ("property trustee");
. The Bank of New York ("Delaware trustee");
. The Bank of New York ("securities trustee"); and
. Three Sempra Energy officers ("regular trustees").
5
Only Sempra Energy, as owner of the trust common securities, can remove or
replace the trustees. In addition, Sempra Energy can increase or decrease the
number of trustees.
Sempra Energy will pay all fees and expenses related to each trust and each
offering of the related trust preferred securities and will pay all ongoing
costs and expenses of each trust, except the respective trust's obligations
under the related trust preferred and common securities.
The trusts will not have separate financial statements. The statements would
not be material to holders of the trust preferred securities because no trust
will have any independent operations. Each trust exists solely for the reasons
summarized above.
6
USE OF PROCEEDS
Unless stated otherwise in the applicable prospectus supplement, the net
proceeds from the sale of the offered securities will be:
. used by Sempra Energy and/or its subsidiaries for general corporate
purposes, including investing in unregulated business activities and
reducing short-term debt incurred to provide interim financing for such
purposes; and
. used by the respective trusts to purchase subordinated debt securities of
Sempra Energy, which will in turn use the proceeds from the issuance of
subordinated debt securities for the purposes stated above.
RATIO OF SEMPRA ENERGY EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK
DIVIDENDS
The following table sets forth the ratio of earnings to combined fixed
charges and preferred stock dividends for Sempra Energy for each of the five
years in the five-year period ended December 31, 2000 and for each of the six-
month periods ended June 30, 2000 and 2001:
Six
Months
Ended
Year Ended December 31, June 30,
------------------------ ---------
1996 1997 1998 1999 2000 2000 2001
---- ---- ---- ---- ---- ---- ----
Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends.. 3.67 3.75 2.73 3.19 2.91 2.77 3.46
7
DESCRIPTION OF SECURITIES
The following is a general description of the terms and provisions of the
securities we may offer and sell by this prospectus. These summaries are not
meant to be a complete description of each security. This prospectus and any
accompanying prospectus supplement will contain the material terms and
conditions for each security. The accompanying prospectus supplement may add,
update or change the terms and conditions of the securities as described in
this prospectus. For more information about the securities offered by us,
please refer to:
. the indenture between Sempra Energy and U.S. Bank Trust National
Association, as trustee, relating to the issuance of each series of
senior debt securities by Sempra Energy (the "senior indenture");
. the indenture between Sempra Energy and The Bank of New York, as trustee,
relating to the issuance of each series of subordinated debt securities
by Sempra Energy (the "subordinated indenture");
. the indenture among Sempra Energy Global Enterprises, Sempra Energy, as
Guarantor, and U.S. Bank Trust National Association, as trustee, relating
to the issuance of each series of senior debt securities by Sempra Energy
Global Enterprises;
. the Declaration of each trust; and
. Sempra Energy's guarantee of the trust preferred securities issued by
each trust.
Forms of these documents are filed as exhibits to the registration
statement. The indentures listed above are sometimes collectively referred to
as the "indentures" and individually referred to as an "indenture." The
indentures are subject to and governed by the Trust Indenture Act of 1939, as
amended, and may be supplemented or amended from time to time following their
execution.
DESCRIPTION OF DEBT SECURITIES
Unless indicated differently in a prospectus supplement, the following
description sets forth the general terms and provisions of the debt securities
that Sempra Energy and Sempra Energy Global Enterprises may offer by this
prospectus. The debt securities may be issued as senior debt securities or
subordinated debt securities in the case of Sempra Energy and as senior debt
securities in the case of Sempra Energy Global Enterprises.
The senior debt securities will be governed by the senior indenture and the
subordinated debt securities will be governed by the subordinated indenture.
Each indenture gives the issuer broad authority to set the particular terms of
each series of debt securities, including the right to modify certain of the
terms contained in the indenture. The particular terms of a series of debt
securities and the extent, if any, to which the particular terms of the issue
modify the terms of the applicable indenture will be described in the
accompanying prospectus supplement relating to such series of debt securities.
Each indenture contains the full legal text of the matters described in this
section. Because this section is a summary, it does not describe every aspect
of the debt securities or the applicable indentures. This summary is subject to
and qualified in its entirety by reference to all the provisions of the
applicable indenture, including definitions of terms used in such indenture. We
also include references in parentheses to certain sections of the indentures.
Whenever we refer to particular sections or defined terms of the indentures in
this prospectus or in a prospectus supplement, these sections or defined terms
are incorporated by reference into this prospectus or into the prospectus
supplement. This summary also is subject to and qualified by reference to the
description of the particular terms of a particular series of debt securities
described in the applicable prospectus supplement or supplements.
8
General
Sempra Energy and Sempra Energy Global Enterprises may issue an unlimited
amount of debt securities under the indentures in one or more series. Neither
company is required to issue all debt securities of one series at the same time
and, unless otherwise provided in a prospectus supplement, either company may
reopen a series, without the consent of the holders of the debt securities of
that series, for issuances of additional debt securities of that series.
The debt securities of Sempra Energy and Sempra Energy Global Enterprises
will be unsecured obligations of the company issuing the security, and the debt
securities of Sempra Energy Global Enterprises will be unconditionally
guaranteed by Sempra Energy as to payment of principal, premium, if any, and
interest as described under the caption "--Guarantee of Sempra Energy; Holding
Company Structure" contained in this prospectus.
Prior to the issuance of each series of debt securities, the terms of the
particular securities will be specified in either a supplemental indenture
(including any pricing supplement) and a board resolution of the issuing
company or in one or more officers' certificates of the issuing company
pursuant to a supplemental indenture or a board resolution. We refer you to the
applicable prospectus supplement for a description of the following terms of
each series of debt securities:
(a) the title of the debt securities;
(b) any limit upon the principal amount of the debt securities;
(c) the date or dates on which principal will be payable or how to
determine the dates;
(d) the rate or rates or method of determination of interest; the date
from which interest will accrue; the dates on which interest will be
payable, which we refer to as the "interest payment dates"; and any record
dates for the interest payable on the interest payment dates;
(e) any obligation or option of the issuing company to redeem, purchase
or repay debt securities, or any option of the registered holder to require
the issuing company to redeem or repurchase debt securities, and the terms
and conditions upon which the debt securities will be redeemed, purchased
or repaid;
(f) the denominations in which the debt securities will be issuable (if
other than denominations of $1,000 and any integral multiple thereof);
(g) whether the debt securities are to be issued in whole or in part in
the form of one or more global debt securities and, if so, the identity of
the depositary for the global debt securities; and
(h) any other terms of the debt securities that may be different from
those described below.
(See Section 301.)
Ranking
The senior debt securities will be the unsecured and unsubordinated
obligations of the company issuing the security. The indebtedness represented
by the senior debt securities will rank equally with all other unsecured and
unsubordinated debt of the company issuing the senior debt security (either
Sempra Energy or Sempra Energy Global Enterprises). The indebtedness
represented by the subordinated debt securities will rank junior and
subordinate in right of payment to the prior payment in full of the senior debt
of Sempra Energy, to the extent and in the manner set forth under the caption
"--Subordination" below and as may be set forth in a prospectus supplement. The
debt securities are obligations of Sempra Energy and Sempra Energy Global
Enterprises exclusively, and are not the obligations of any of their respective
subsidiaries. Because each company conducts its operations primarily through
its respective subsidiaries and substantially all of its respective
consolidated assets are held by its respective subsidiaries, the debt
securities will be effectively subordinated to all existing and future
indebtedness and other liabilities of each issuing company's respective
subsidiaries.
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Guarantee of Sempra Energy; Holding Company Structure
Sempra Energy will unconditionally guarantee the payment of principal of and
any premium and interest on the debt securities issued by Sempra Energy Global
Enterprises, when due and payable, whether at the stated maturity date, by
declaration of acceleration, call for redemption or otherwise, in accordance
with the terms of the debt securities and the applicable indenture. These
guarantees are referred to as the "debt securities guarantees" in this
prospectus. The debt securities guarantees will remain in effect until the
entire principal of and any premium and interest on the debt securities has
been paid in full or otherwise discharged in accordance with the provisions of
the applicable indenture.
Sempra Energy conducts its operations primarily through its subsidiaries and
substantially all of its consolidated assets are held by its subsidiaries.
Accordingly, Sempra Energy's cash flow and its ability to meet its obligations
under its debt securities and the debt securities guarantees are largely
dependent upon the earnings of its subsidiaries and the distribution or other
payment of these earnings to Sempra Energy in the form of dividends or loans or
advances and repayment of loans and advances from Sempra Energy. Except for
Sempra Energy Global Enterprises with respect to repayment of their debt
securities, the subsidiaries are separate and distinct legal entities and have
no obligation to pay any amounts due on the Sempra Energy debt securities or to
make any funds available for payment of amounts due on these debt securities or
the debt securities guarantees.
Because Sempra Energy is a holding company, its obligations under the debt
securities and the debt securities guarantees will be structurally subordinated
to all existing and future liabilities of its subsidiaries. Therefore, Sempra
Energy's rights and the rights of its creditors, including the rights of the
holders of the debt securities issued by Sempra Energy and any debt securities
guarantees, to participate in the assets of any subsidiary upon the liquidation
or reorganization of the subsidiary will be subject to the prior claims of the
subsidiary's creditors. To the extent that Sempra Energy may itself be a
creditor with recognized claims against any of its subsidiaries, Sempra
Energy's claims would still be effectively subordinated to any security
interest in, or mortgages or other liens on, the assets of the subsidiary and
would be subordinated to any indebtedness or other liabilities of the
subsidiary that are senior to the claims held by Sempra Energy. Sempra Energy
expects to incur, and that each of its subsidiaries will incur, substantial
additional amounts of indebtedness.
Sempra Energy Global Enterprises also conducts its operations primarily
through its subsidiaries and substantially all of its consolidated assets are
held by its subsidiaries. Accordingly, the discussion above is equally
applicable to Sempra Energy Global Enterprises and the debt securities it
issues.
Payment of Debt Securities--Interest
Unless indicated differently in a prospectus supplement, the issuing company
will pay interest on the debt securities on each interest payment date by check
mailed to the person in whose name the debt securities are registered as of the
close of business on the regular record date relating to the interest payment
date.
However, if the issuing company defaults in paying interest on a debt
security, the issuing company will pay defaulted interest in either of the two
following ways:
(a) The issuing company will first propose to the trustee a payment date
for the defaulted interest. Next, the trustee will choose a special record
date for determining which registered holders are entitled to the payment.
The special record date will be between ten and 15 days before the proposed
payment date. Finally, the issuing company will pay the defaulted interest
on the payment date to the registered holder of the debt security as of the
close of business on the special record date.
(b) Alternatively, the issuing company can propose to the trustee any
other lawful manner of payment that is consistent with the requirements of
any securities exchange on which the debt securities are listed for
trading. If the trustee thinks the proposal is practicable, payment will be
made as proposed.
(See Section 307.)
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Payment of Debt Securities--Principal
The company issuing the debt securities will pay principal of and any
premium and interest on the debt securities at stated maturity, upon redemption
or otherwise, upon presentation of the debt securities at the office of the
paying agent, which initially will be the trustee or such other paying agent
designated in accordance with the applicable indenture. Any other paying agent
initially designated for the debt securities of a particular series will be
named in the applicable prospectus supplement.
If any interest payment date, redemption date or the maturity date of the
debt securities is not a business day at any place of payment, then payment of
the principal, premium, if any, and interest may be made on the next business
day at that place of payment. In that case, no interest will accrue on the
amount payable for the period from and after the applicable interest payment
date, redemption date or maturity date, as the case may be.
The issuing company will pay principal of and any premium on the debt
securities at stated maturity, upon redemption or otherwise, upon presentation
of the debt securities at the office of the paying agent. In the discretion of
the company issuing the debt securities, the issuing company may appoint one or
more additional paying agents and security registrars and designate one or more
additional places for payment and for registration of transfer, but must at all
times maintain a place of payment of the debt securities and a place for
registration of transfer of the debt securities in the Borough of Manhattan,
the City of New York. (See Section 1002.)
Form; Transfers; Exchanges
The debt securities will be issued
(a) only in fully registered form;
(b) without interest coupons; and
(c) on denominations that are even multiples of $1,000.
You may have your debt securities divided into debt securities of smaller
denominations (of at least $1,000) or combined into debt securities of larger
denominations, as long as the total principal amount is not changed. This is
called an "exchange." (See Section 305.)
You may exchange or transfer debt securities at the office of the trustee.
The trustee acts as our agent for registering debt securities in the names of
holders and transferring debt securities. The company issuing the debt
securities may appoint another agent or act as its own agent for this purpose.
The entity performing the role of maintaining the list of registered holders is
called the "security registrar." It will also perform transfers. (See Section
305.)
In the discretion of the company issuing the debt securities, the issuing
company may change the place for registration of transfer of the debt
securities and may remove and/or appoint one or more additional security
registrars. (See Sections 305 and 1002.)
There will be no service charge for any transfer or exchange of the debt
securities, but you may be required to pay a sum sufficient to cover any tax or
other governmental charge payable in connection with the transfer or exchange.
We may block the transfer or exchange of (a) debt securities during a period of
15 days prior to giving any notice of redemption or (b) any debt security
selected for redemption in whole or in part, except the unredeemed portion of
any debt security being redeemed in part. (See Section 305.)
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Optional Redemption
Unless indicated differently in a prospectus supplement, all or a portion of
the debt securities may be redeemed at the option of the issuing company at any
time or from time to time. The redemption price for the debt securities to be
redeemed on any redemption date will be equal to the greater of the following
amounts:
. 100% of the principal amount of the debt securities being redeemed on the
redemption date; or
. the sum of the present values of the remaining scheduled payments of
principal and interest on the debt securities being redeemed on that
redemption date (not including any portion of any payments of interest
accrued to the redemption date) discounted to the redemption date on a
semiannual basis at the Adjusted Treasury Rate (as defined below) plus a
number of basis points as set forth in any accompanying prospectus
supplement, as determined by the Reference Treasury Dealer (as defined
below),
plus, in each case, accrued and unpaid interest thereon to the redemption date.
Notwithstanding the foregoing, installments of interest on the debt securities
that are due and payable on interest payment dates falling on or prior to a
redemption date will be payable on the interest payment date to the registered
holders as of the close of business on the relevant record date according to
the debt securities and the indenture. The redemption price will be calculated
on the basis of a 360-day year consisting of twelve 30-day months.
The company issuing the debt securities will mail notice of any redemption
at least 30 days but not more than 60 days before the redemption date to each
registered holder of the debt securities to be redeemed. Once notice of
redemption is mailed, the debt securities called for redemption will become due
and payable on the redemption date and at the applicable redemption price, plus
accrued and unpaid interest to the redemption date. If the issuing company
elects to redeem all or a portion of the debt securities, that redemption will
not be conditional upon receipt by the paying agent or the trustee of monies
sufficient to pay the redemption price. (See Section 1104.)
Debt securities will cease to bear interest on the redemption date. The
issuer of the debt securities will pay the redemption price and any accrued
interest once you surrender the debt security for redemption. (See
Section 1105.) If only part of a debt security is redeemed, the trustee will
deliver to you a new debt security of the same series for the remaining portion
without charge. (Section 1106.)
Unless the company issuing the debt securities defaults in payment of the
redemption price, on and after the redemption date interest will cease to
accrue on the debt securities or portions thereof called for redemption.
"Adjusted Treasury Rate" means, with respect to any redemption date, the
rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Reference Treasury Dealer as having a maturity comparable to
the remaining term of the debt securities to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such debt securities.
"Comparable Treasury Price" means, with respect to any redemption date, (A)
the average of the Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (B) if the trustee receives fewer than three such Reference
Treasury Dealer Quotations, the average of all such Quotations, or (C) if the
trustee receives only one Reference Treasury Dealer Quotation, such Quotation.
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"Reference Treasury Dealer" means (A) the underwriters referenced in any
applicable prospectus supplement; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government securities dealer in New
York City (a "Primary Treasury Dealer"), the company issuing the debt
securities will substitute therefor another Primary Treasury Dealer; and (B)
any other Primary Treasury Dealer(s) selected by the trustee after consultation
with the issuing company.
"Reference Treasury Dealer Quotation" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the trustee by such Reference Treasury Dealer at 5:00 p.m. (New York
City time) on the third business day preceding such redemption date.
Events of Default
An "event of default" occurs with respect to the debt securities of any
series if:
(a) the issuing company does not pay any interest on any debt securities
of the applicable series within 30 days of the due date;
(b) the issuing company does not pay any principal of or premium on any
debt securities of the applicable series on the due date;
(c) the issuing company or, if applicable, the guarantor of the debt
securities remains in breach of a covenant or warranty (excluding covenants
and warranties solely applicable to another series of debt securities
issued under the applicable indenture) in the applicable indenture or the
debt securities of the applicable series for 60 days after it receives a
written notice of default stating it is in breach and requiring remedy of
the breach; the notice must be sent by either the trustee or registered
holders of at least 25% of the principal amount of the outstanding debt
securities of the affected series;
(d) default occurs under any bond, note, debenture or other instrument
evidencing any indebtedness for money borrowed by the issuing company or,
if applicable, the guarantor of the debt securities, excluding any of the
issuing company's subsidiaries (including a default with respect to any
other series of debt securities issued under the applicable indenture), or
under any mortgage, indenture or other instrument under which there may be
issued or by which there may be secured or evidenced any indebtedness for
money borrowed by the issuing company (or the payment of which is
guaranteed by the issuing company or, if applicable, the guarantor of the
debt securities), excluding any of the issuing company's subsidiaries,
whether such indebtedness or guarantee exists on the date of the applicable
indenture or is issued or entered into following the date of the applicable
indenture, if:
(1) either:
. such default results from the failure to pay any such indebtedness
when due; or
. as a result of such default the maturity of such indebtedness has
been accelerated prior to its expressed maturity; and
(2) the principal amount of such indebtedness, together with the
principal amount of any other such indebtedness in default for
failure to pay any such indebtedness when due or the maturity of
which has been so accelerated, aggregates at least $25 million;
(e) the issuing company or, if applicable, the guarantor of the debt
securities files for bankruptcy or other specified events in bankruptcy,
insolvency, receivership or reorganization occur; or
(f) any other event of default specified in the applicable prospectus
supplement for such series occurs.
(See Section 501.)
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No event of default with respect to a series of debt securities necessarily
constitutes an event of default with respect to the debt securities of any
other series issued under the applicable indenture.
Remedies
Acceleration
If an event of default occurs and is continuing with respect to any series
of debt securities, then either the trustee or the registered holders of at
least 25% in principal amount of the outstanding debt securities of that
series may declare the principal amount of all of the debt securities of that
series, together with accrued and unpaid interest thereon, to be due and
payable immediately. (See Section 502.)
Rescission of Acceleration
After the declaration of acceleration has been made with respect to any
series of debt securities and before the trustee has obtained a judgment or
decree for payment of the money due, the declaration and its consequences will
be rescinded and annulled, if:
(a) the company issuing the debt securities of that series pays or
deposits with the trustee a sum sufficient to pay:
(1) all overdue interest on the debt securities of that series, other
than interest which has become due by declaration of acceleration;
(2) the principal of and any premium on the debt securities of that
series which have become due, otherwise than by the declaration of
acceleration, and overdue interest on these amounts;
(3) interest on overdue interest, other than interest which has
become due by declaration of acceleration, on the debt securities of
that series to the extent lawful; and
(4) all amounts due to the trustee under the applicable indenture;
and
(b) all events of default with respect to the debt securities of that
series, other than the nonpayment of the principal and interest which has
become due solely by the declaration of acceleration, have been cured or
waived as provided in the applicable indenture.
(See Section 502.)
For more information as to waiver of defaults, see "--Waiver of Default and
of Compliance" below.
Control by Registered Holders; Limitations
If an event of default with respect to the debt securities of any series
occurs and is continuing, the registered holders of a majority in principal
amount of the outstanding debt securities of that series, voting as a single
class, without regard to the holders of outstanding debt securities of any
other series that may also be in default, will have the right to direct the
time, method and place of:
(a) conducting any proceeding for any remedy available to the trustee
with respect to the debt securities of that series; and
(b) exercising any trust or power conferred on the trustee with respect
to the debt securities of that series.
These rights of registered holders to give directions are subject to the
following limitations:
(a) the registered holders' directions do not conflict with any law or
the applicable indenture; and
(b) the direction is not unduly prejudicial to the rights of holders of
the debt securities of that series who do not join in that action.
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The trustee may also take any other action it deems proper which is
consistent with the registered holders' direction. (See Sections 512 and 603.)
In addition, each indenture provides that no registered holder of debt
securities of any series will have any right to institute any proceeding,
judicial or otherwise, with respect to the applicable indenture or for the
appointment of a receiver or for any other remedy thereunder unless:
(a) that registered holder has previously given the trustee written
notice of a continuing event of default;
(b) the registered holders of at least 25% in aggregate principal amount
of the outstanding debt securities of that series have made written request
to the trustee to institute proceedings in respect of that event of default
and have offered the trustee reasonable indemnity against costs and
liabilities incurred in complying with the request; and
(c) for 60 days after receipt of the notice, the trustee has failed to
institute a proceeding and no direction inconsistent with the request has
been given to the trustee during the 60-day period by the registered
holders of a majority in aggregate principal amount of outstanding debt
securities of that series.
Furthermore, no registered holder will be entitled to institute any action if
and to the extent that the action would disturb or prejudice the rights of
other registered holders of debt securities. (See Section 507.)
However, each registered holder has an absolute and unconditional right to
receive payment when due and to bring a suit to enforce that right. (See
Section 508.)
Notice of Default
The trustee is required to give the registered holders of debt securities of
the affected series notice of any default under the applicable indenture to the
extent required by the Trust Indenture Act, unless the default has been cured
or waived; except that in the case of an event of default of the character
specified above in clause (c) under "--Events of Default," no notice shall be
given to such registered holders until at least 30 days after the occurrence of
the default. The Trust Indenture Act currently permits the trustee to withhold
notices of default (except for certain payment defaults) if the trustee in good
faith determines the withholding of the notice to be in the interests of the
registered holders. (See Section 602.)
The company issuing the debt securities will furnish the trustee with an
annual statement as to its compliance with the conditions and covenants in the
applicable indenture.
Waiver of Default and of Compliance
The registered holders of a majority in aggregate principal amount of the
outstanding debt securities of any series, voting as a single class, without
regard to the holders of outstanding debt securities of any other series, may
waive, on behalf of all registered holders of the debt securities of that
series, any past default under the applicable indenture, except a default in
the payment of principal, premium or interest, or with respect to compliance
with certain provisions of the applicable indenture that cannot be amended
without the consent of the registered holder of each outstanding debt security
of that series. (See Section 513.)
Unless indicated differently in a prospectus supplement, compliance with
certain covenants in the applicable indenture or otherwise provided with
respect to debt securities of any series may be waived prior to the time
specified for compliance by the registered holders of a majority in aggregate
principal amount of the debt securities of such series. (See Section 1006.)
15
Consolidation, Merger and Conveyance of Assets as an Entirety; No Financial
Covenants
Sempra Energy and Sempra Energy Global Enterprises have each agreed not to
consolidate or merge with or into any other entity, or to sell, transfer,
lease or otherwise convey its properties and assets as an entirety or
substantially as an entirety to any entity, unless:
(a) it is the continuing entity (in the case of a merger) or the
successor entity formed by such consolidation or into which it is merged or
which acquires by sale, transfer, lease or other conveyance its properties
and assets, as an entirety or substantially as an entirety, is a
corporation organized and existing under the laws of the United States of
America or any State thereof or the District of Columbia, and expressly
assumes, by supplemental indenture, (i) the due and punctual payment of the
principal, premium and interest on all the debt securities and the
performance of all of the covenants under the indenture and (ii) in the
case of Sempra Energy, the due and punctual payment of all amounts under
the debt securities guarantees; and
(b) immediately after giving effect to the transaction, no event of
default, and no event which after notice or lapse of time or both would
become an event of default, has or will have occurred and be continuing.
Neither the applicable indenture nor the debt securities guarantee contains
any financial or other similar restrictive covenants.
(See Section 801.)
Modification of Indenture
Without Registered Holder Consent. Without the consent of any registered
holders of debt securities, the company issuing the debt securities and the
trustee may enter into one or more supplemental indentures for any of the
following purposes:
(a) to evidence the succession of another entity to the company issuing
the debt securities; or
(b) to add one or more covenants for the benefit of the holders of all
or any series of debt securities or to surrender any right or power
conferred upon the company issuing the debt securities; or
(c) to add any additional events of default for all or any series of
debt securities; or
(d) to change or eliminate any provision of the applicable indenture so
long as the change or elimination does not apply to any debt securities
entitled to the benefit of such provision or to add any new provision to
the applicable indenture (in addition to the provisions which may otherwise
be added to the applicable indenture pursuant to the other clauses of this
paragraph) so long as the addition does not apply to any outstanding debt
securities; or
(e) to provide security for the debt securities of any series; or
(f) to establish the form or terms of debt securities of any series, as
permitted by the applicable indenture; or
(g) to evidence and provide for the acceptance of appointment of a
separate or successor trustee; or
(h) to cure any ambiguity, defect or inconsistency or to make any other
changes with respect to any series of debt securities that does not
adversely affect the interests of the holders of debt securities of that
series in any material respect.
(See Section 901.)
With Registered Holder Consent. Subject to the following sentence, the
company issuing the debt securities and the trustee may, with some exceptions,
amend or modify the applicable indenture with the consent of the registered
holders of at least a majority in aggregate principal amount of the debt
securities of
16
each series affected by the amendment or modification. However, no amendment or
modification may, without the consent of the registered holder of each
outstanding debt security affected thereby:
(a) change the stated maturity of the principal or interest on any debt
security or reduce the principal amount, interest or premium payable or
change any place of payment where or the currency in which any debt
security is payable, or impair the right to bring suit to enforce any
payment;
(b) reduce the percentages of registered holders whose consent is
required for any supplemental indenture or waiver;
(c) modify or affect in any manner the terms and conditions of the
obligations of Sempra Energy in respect of the due and punctual payment of
the principal of, or premium, if any or interest on any debt securities
guarantees; or
(d) modify certain provisions in the applicable indenture relating to
supplemental indentures and waivers of certain covenants and past defaults.
A supplemental indenture which changes or eliminates any provision of the
applicable indenture expressly included solely for the benefit of holders of
debt securities of one or more particular series will be deemed not to affect
the interests under the applicable indenture of the holders of debt securities
of any other series.
(See Section 902.)
Defeasance
The indentures provide, unless the terms of the particular series of debt
securities provide otherwise, that the company issuing the debt securities or,
if applicable, the guarantor of the debt securities, may, upon satisfying
several conditions, cause it to be discharged from its respective obligations,
with some exceptions, with respect to any series of debt securities, which we
refer to as "defeasance."
One condition the issuing company or, if applicable, the guarantor of the
debt securities must satisfy is the irrevocable deposit with the trustee, in
trust, of money and/or government obligations which, through the scheduled
payment of principal and interest on those obligations, would provide
sufficient moneys to pay the principal of and any premium and interest on those
debt securities on the maturity dates of the payments or upon redemption.
In addition, the company issuing the debt securities or, if applicable, the
guarantor of the debt securities will be required to deliver an opinion of
counsel to the effect that a holder of debt securities will not recognize
income, gain or loss for federal income tax purposes as a result of the
defeasance and will be subject to federal income tax on the same amounts, at
the same times and in the same manner as if that defeasance had not occurred.
The opinion of counsel must be based upon a ruling of the Internal Revenue
Service or a change in law after the date of the applicable indenture.
(See Article XIII.)
Satisfaction and Discharge
The applicable indenture will cease to be of further effect with respect to
any series of debt securities, and we will be deemed to have satisfied and
discharged all of our obligations under the applicable indenture, except as
noted below, when:
. all outstanding debt securities of such series have become due or will
become due within one year at their stated maturity or on a redemption
date; and
. the issuing company deposits with the trustee, in trust, funds that are
sufficient to pay and discharge all remaining indebtedness on the
outstanding debt securities of such series.
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The company issuing the debt securities and, as applicable, guaranteeing the
debt securities, of such series will remain obligated to pay all other amounts
due under the applicable indenture and guarantee and to perform certain
ministerial tasks as described in the applicable indenture.
(See Section 401.)
Resignation and Removal of the Trustee; Deemed Resignation
The trustee with respect to any series of debt securities may resign at any
time by giving written notice to us. The trustee may also be removed with
respect to the debt securities of any series by act of the registered holders
of a majority in principal amount of the then outstanding debt securities of
such series. No resignation or removal of the trustee and no appointment of a
successor trustee will become effective until the acceptance of appointment by
a successor trustee in accordance with the requirements of the applicable
indenture. Under certain circumstances, the company issuing a series of debt
securities may appoint a successor trustee with respect to such series of debt
securities and if the successor trustee accepts, the trustee will be deemed to
have resigned. (See Section 610.)
Subordination
Unless indicated differently in a prospectus supplement, Sempra Energy's
subordinated debt securities will be subordinated in right of payment to the
prior payment in full of all its senior debt. This means that, upon:
(a) any distribution of the assets of Sempra Energy upon its
dissolution, winding-up, liquidation or reorganization in bankruptcy,
insolvency, receivership or other proceedings; or
(b) acceleration of the maturity of the subordinated debt securities; or
(c) a failure to pay any senior debt or interest thereon when due and
continuance of that default beyond any applicable grace period; or
(d) acceleration of the maturity of any senior debt as a result of a
default,
the holders of all of Sempra Energy's senior debt will be entitled to receive:
. in the case of clauses (a) and (b) above, payment of all amounts due or
to become due on all senior debt; and
. in the case of clauses (c) and (d) above, payment of all amounts due on
all senior debt,
before the holders of any of the subordinated debt securities are entitled to
receive any payment. So long as any of the events in clauses (a), (b), (c) or
(d) above has occurred and is continuing, any amounts payable on the
subordinated debt securities will instead by paid directly to the holders of
all senior debt to the extent necessary to pay the senior debt in full and, if
any payment is received by the subordinated indenture trustee under the
subordinated indenture or the holders of any of the subordinated debt
securities before all senior debt is paid in full, the payment or distribution
must be paid over to the holders of the unpaid senior debt. Subject to paying
the senior debt in full, the holders of the subordinated debt securities will
be subrogated to the rights of the holders of the senior debt to the extent
that payments are made to the holders of senior debt out of the distributive
share of the subordinated debt securities. (See Section 1401.)
"senior debt" means with respect to the subordinated debt securities, the
principal of, and premium, if any, and interest on and any other payment in
respect of indebtedness due pursuant to any of the following, whether
outstanding on the date the subordinated debt securities are issued or
thereafter incurred, created or assumed:
(a) all of the indebtedness of Sempra Energy evidenced by notes,
debentures, bonds or other securities sold by it for money or other
obligations for money borrowed;
18
(b) all indebtedness of others of the kinds described in the preceding
clause (a) assumed by or guaranteed in any manner by Sempra Energy or in
effect guaranteed by Sempra Energy through an agreement to purchase,
contingent or otherwise, as applicable; and
(c) all renewals, extensions or refundings of indebtedness of the kinds
described in either of the preceding clauses (a) and (b), unless, in the
case of any particular indebtedness, renewal, extension or refunding, the
instrument creating or evidencing the same or the assumption or guarantee
of the same by its terms provides that such indebtedness, renewal,
extension or refunding is not superior in right of payment to or is pari
passu with such securities. (See Section 101.)
Due to the subordination, if assets of Sempra Energy are distributed upon
insolvency, certain of its general creditors may recover more, ratably, than
holders of subordinated debt securities. The subordination provisions will not
apply to money and securities held in trust under the satisfaction and
discharge and the defeasance provisions of the applicable subordinated
indenture. (See Section 1410.)
The subordinated debt securities, the subordinated indenture and the trust
preferred securities guarantee do not limit Sempra Energy or any of its
subsidiaries' ability to incur additional indebtedness, including indebtedness
that will rank senior to subordinated debt securities and trust preferred
securities guarantees. Sempra Energy expects that it will incur, and that each
of its subsidiaries will incur, substantial additional amounts of indebtedness
in the future. (See Section 301.)
Conversion Rights
The terms and conditions of any series of debt securities being offered that
are convertible into common stock of Sempra Energy will be set forth in a
prospectus supplement. These terms will include the conversion price, the
conversion period, provisions as to whether conversion will be at the option of
the holder or the company issuing the debt securities, the events requiring an
adjustment of the conversion price and provisions affecting conversion in the
event that such series of debt securities are redeemed.
Miscellaneous Provisions
Each indenture provides that certain debt securities, including those for
which payment or redemption money has been deposited or set aside in trust as
described under "--Satisfaction and Discharge" above, will not be deemed to be
"outstanding" in determining whether the registered holders of the requisite
principal amount of the outstanding debt securities have given or taken any
demand, direction, consent or other action under the indenture as of any date,
or are present at a meeting of registered holders for quorum purposes. (See
Section 101.)
The company issuing the debt securities will be entitled to set any day as a
record date for the purpose of determining the registered holders of
outstanding debt securities of any series entitled to give or take any demand,
direction, consent or other action under the applicable indenture, in the
manner and subject to the limitations provided in the applicable indenture. In
certain circumstances, the trustee also will be entitled to set a record date
for action by registered holders of any series of outstanding debt securities.
If a record date is set for any action to be taken by registered holders of
particular debt securities, the action may be taken only by persons who are
registered holders of the respective debt securities on the record date. (See
Section 104.)
Governing Law
Each indenture and the related debt securities will be governed by and
construed in accordance with the laws of the State of New York. (See Section
112.)
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DESCRIPTION OF SEMPRA ENERGY'S
COMMON STOCK AND PREFERRED STOCK
Unless indicated differently in a prospectus supplement, this section
describes the terms of Sempra Energy's common stock and preferred stock. The
following description of Sempra Energy's common stock and preferred stock is
only a summary and is qualified in its entirety by reference to the articles of
incorporation and bylaws of Sempra Energy. Therefore, you should read carefully
the more detailed provisions of Sempra Energy's Amended and Restated Articles
of Incorporation, Sempra Energy's Amended and Restated Bylaws, and Sempra
Energy's Rights Agreement, dated May 26, 1998, between Sempra Energy and
First Chicago Trust Company of New York, as rights agent, copies of which are
incorporated by reference as exhibits to the registration statement of which
this prospectus is a part.
General
The authorized capital stock of Sempra Energy consists of (1) 750,000,000
shares of Sempra Energy common stock, without par value, and (2) 50,000,000
shares of preferred stock, without par value. As of June 30, 2001, there were
206,836,453 issued and outstanding shares of Sempra Energy common stock and no
shares of Sempra Energy preferred stock. No other classes of capital stock are
authorized under the Sempra Energy articles of incorporation. The issued and
outstanding shares of Sempra Energy common stock are duly authorized, validly
issued, fully paid, nonassessable and free of preemptive rights.
Sempra Energy Common Stock
The holders of Sempra Energy common stock are entitled to receive such
dividends as the Sempra Energy board of directors may from time to time
declare, subject to any rights of holders of outstanding shares of Sempra
Energy preferred stock. Except as otherwise provided by law, each holder of
Sempra Energy common stock is entitled to one vote per share on each matter
submitted to a vote of a meeting of shareholders, subject to any class or
series voting rights of holders of Sempra Energy preferred stock. Under the
Sempra Energy articles of incorporation, the Sempra Energy board of directors
is classified into three classes each consisting of a number as nearly equal as
possible to one-third of the total number of directors constituting the entire
Sempra Energy board of directors. The holders of shares of Sempra Energy
common stock are not entitled to cumulate votes for the election of directors.
In the event of any liquidation, dissolution or winding up of Sempra Energy,
whether voluntary or involuntary, the holders of shares of Sempra Energy common
stock, subject to any rights of the holders of outstanding shares of Sempra
Energy preferred stock, are entitled to receive any remaining assets of
Sempra Energy after the discharge of its liabilities.
Holders of Sempra Energy common stock are not entitled to preemptive rights
to subscribe for or purchase any part of any new or additional issue of stock
or securities convertible into stock. Sempra Energy common stock does not
contain any redemption provisions or conversion rights and is not liable to
assessment or further call.
Each outstanding share of Sempra Energy common stock is accompanied by a
right to purchase one one-hundredth of a share of Class A Junior Participating
Preferred Stock, without par value, of Sempra Energy at a price of $80 per
right, subject to certain anti-dilution adjustments. The Sempra Energy board of
directors has reserved 7,500,000 shares of such Class A preferred stock for
issuance upon exercise of the rights, as more fully discussed below under the
caption "--Description of Preferred Share Purchase Rights."
The registrar and transfer agent for the Sempra Energy common stock is First
Chicago Trust Company of New York.
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Sempra Energy Preferred Stock
The Sempra Energy board of directors is authorized, pursuant to the Sempra
Energy articles of incorporation, to issue up to 50,000,000 shares of Sempra
Energy preferred stock in one or more series and to fix and determine the
number of shares of Sempra Energy preferred stock of any series, to determine
the designation of any such series, to increase or decrease the number of
shares of any such series subsequent to the issue of shares of that series,
and to determine or alter the rights, preferences, privileges and restrictions
granted to or imposed upon any such series. Currently there are no shares of
Sempra Energy preferred stock outstanding. However, the Sempra Energy board of
directors has reserved 7,500,000 shares of Class A preferred stock for
issuance in connection with rights issued under the Sempra Energy rights
agreement.
Prior to the issuance of shares of each series of Sempra Energy preferred
stock, the board of directors is required to adopt resolutions and file a
certificate of determination with the Secretary of State of the
State of California. The certificate of determination will fix for each series
the designation and number of shares and the rights, preferences, privileges
and restrictions of the shares including, but not limited to, the following:
(a) the title and stated value of the Sempra Energy preferred stock;
(b) voting rights, if any, of the Sempra Energy preferred stock;
(c) any rights and terms of redemption (including sinking fund
provisions);
(d) the dividend rate(s), period(s) and/or payment date(s) or method(s)
of calculation applicable to the Sempra Energy preferred stock;
(e) whether dividends are cumulative or non-cumulative and, if
cumulative, the date from which dividends on the Sempra Energy preferred
stock will accumulate;
(f) the relative ranking and preferences of the Sempra Energy preferred
stock as to dividend rights and rights upon the liquidation, dissolution or
winding up of Sempra Energy's affairs;
(g) the terms and conditions, if applicable, upon which the Sempra
Energy preferred stock will be convertible into Sempra Energy common stock,
including the conversion price (or manner of calculation) and conversion
period;
(h) the provision for redemption, if applicable, of the Sempra Energy
preferred stock;
(i) the provisions for a sinking fund, if any, for the Sempra Energy
preferred stock;
(j) liquidation preferences;
(k) any limitations on issuance of any class or series of Sempra Energy
preferred stock ranking senior to or on a parity with the class or series
of Sempra Energy preferred stock as to dividend rights and rights upon
liquidation, dissolution or winding up of Sempra Energy's affairs; and
(l) any other specific terms, preferences, rights, limitations or
restrictions of the Sempra Energy preferred stock.
All shares of Sempra Energy preferred stock will, when issued, be fully
paid and nonassessable and will not have any preemptive or similar rights.
In addition to the terms listed above, we will set forth in a prospectus
supplement the following terms relating to the class or series of Sempra
Energy preferred stock being offered:
(a) the number of shares of the Sempra Energy preferred stock offered,
the liquidation preference per share and the offering price of the Sempra
Energy preferred stock;
(b) the procedures for any auction and remarketing, if any, for the
Sempra Energy preferred stock;
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(c) any listing of the Sempra Energy preferred stock on any securities
exchange; and
(d) a discussion of any material and/or special United States federal
income tax considerations applicable to the Sempra Energy preferred stock.
Rank
The Sempra Energy preferred stock will rank, with respect to dividends and
upon our liquidation, dissolution or winding up:
(a) senior to all classes or series of Sempra Energy common stock and to
all of our equity securities ranking junior to the Sempra Energy preferred
stock;
(b) on a parity with all of Sempra Energy's equity securities the terms
of which specifically provide that the equity securities rank on a parity
with the Sempra Energy preferred stock; and
(c) junior to all of Sempra Energy's equity securities the terms of
which specifically provide that the equity securities rank senior to the
Sempra Energy preferred stock.
Description of Preferred Share Purchase Rights
On May 26, 1998, the Sempra Energy board of directors adopted a preferred
share purchase rights plan providing that one preferred share purchase right
will attach to each share of Sempra Energy common stock (each, a "purchase
right"). The description and terms of the rights are set forth in a rights
agreement, dated as of May 26, 1998, by and between Sempra Energy and First
Chicago Trust Company of New York, as rights agent. The purchase rights have an
anti-takeover effect that is intended to discourage coercive or unfair takeover
tactics and to encourage any potential acquirer to negotiate a fair price to
all Sempra Energy shareholders. The purchase rights may cause substantial
dilution to any party that may attempt to acquire Sempra Energy on terms not
approved by the Sempra Energy board of directors. However, the purchase rights
are structured in a way so as not to interfere with any negotiated merger or
other business combination. The purchase rights will expire on May 31, 2008.
Until a purchase right is exercised, the holder of the purchase right will have
no rights as a shareholder of Sempra Energy beyond those rights afforded to
existing shareholders, including the right to vote or to receive dividends.
The purchase rights are designed to assure that all of Sempra Energy's
shareholders receive fair and equal treatment in the event of any proposed
takeover of Sempra Energy and to guard against partial tender offers, open
market accumulations and other abusive tactics that may be deployed to gain
control of Sempra Energy without a control premium paid to all shareholders.
Any time prior to the first date that a person or group has become an
"acquiring person" as defined in the rights agreement, the purchase rights
should not interfere with any merger or other business combination as long as
it is approved by the Sempra Energy board of directors.
Anti-Takeover Provisions
The Sempra Energy articles of incorporation and bylaws contain provisions
that may have the effect of discouraging persons from acquiring large blocks of
Sempra Energy stock or delaying or preventing a change in control of Sempra
Energy. The material provisions that may have such an effect are:
(a) classification of the Sempra Energy board of directors into three
classes with the term of only one class expiring each year;
(b) a provision permitting the Sempra Energy board of directors to make,
amend or repeal the Sempra Energy bylaws;
(c) authorization for the Sempra Energy board of directors to issue
Sempra Energy preferred stock in series and to fix rights and preferences
of the series (including, among other things, whether, and to what extent,
the shares of any series will have voting rights and the extent of the
preferences of the shares of any series with respect to dividends and other
matters);
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(d) a provision that shareholders may take action only at annual or
special meetings or by unanimous written consent in lieu of a meeting;
(e) advance notice procedures with respect to nominations of directors
or proposals other than those adopted or recommended by the Sempra Energy
board of directors; and
(f) provisions permitting amendment of certain of these provisions only
by an affirmative vote of the holders of at least two-thirds of the
outstanding shares of Sempra Energy common stock entitled to vote.
Some acquisitions of Sempra Energy's outstanding voting shares would also
require approval of the SEC under the Public Utility Holding Company Act of
1935 and of various state and foreign regulatory authorities.
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DESCRIPTION OF WARRANTS
This section describes the general terms of the warrants that Sempra Energy
may offer and sell by this prospectus. This prospectus and any accompanying
prospectus supplement will contain the material terms and conditions for each
warrant. The accompanying prospectus supplement may add, update or change the
terms and conditions of the warrants as described in this prospectus. In this
section, references to "we," "our" and "us" mean Sempra Energy excluding,
unless otherwise expressly stated or the context otherwise requires, its
subsidiaries.
General
We, and/or Sempra Energy Global Enterprises, may issue warrants to purchase
debt securities, preferred stock or common stock. Warrants may be issued
independently or together with any securities and may be attached to or
separate from those securities. The warrants will be issued under warrant
agreements to be entered into between us and a bank or trust company, as
warrant agent, all of which will be described in the prospectus supplement
relating to the warrants we are offering. The warrant agent will act solely as
our agent in connection with the warrants and will not have any obligation or
relationship of agency or trust for or with any holders or beneficial owners of
warrants. A copy of the warrant agreement will be filed with the SEC in
connection with the offering of the warrants.
Debt Warrants
We, and/or Sempra Energy Global Enterprises, may issue warrants for the
purchase of our debt securities, or in the case of warrants issued by Sempra
Energy Global Enterprises, their debt securities. As explained below, each debt
warrant will entitle its holder to purchase debt securities at an exercise
price set forth in, or to be determinable as set forth in, the related
prospectus supplement. Debt warrants may be issued separately or together with
debt securities.
The debt warrants are to be issued under debt warrant agreements to be
entered into between us, or, if applicable, Sempra Energy Global Enterprises,
and one or more banks or trust companies, as debt warrant agent, as will be set
forth in the prospectus supplement relating to the debt warrants being offered
by the prospectus supplement and this prospectus. A copy of the debt warrant
agreement, including a form of debt warrant certificate representing the debt
warrants, will be filed with the SEC in connection with the offering of the
debt warrants.
The particular terms of each issue of debt warrants, the debt warrant
agreement relating to the debt warrants and the debt warrant certificates
representing debt warrants will be described in the applicable prospectus
supplement, including, as applicable:
(a) the title of the debt warrants;
(b) the initial offering price;
(c) the title, aggregate principal amount and terms of the debt
securities purchasable upon exercise of the debt warrants;
(d) the currency or currency units in which the offering price, if any,
and the exercise price are payable;
(e) the title and terms of any related debt securities with which the
debt warrants are issued and the number of the debt warrants issued with
each debt security;
(f) the date, if any, on and after which the debt warrants and the
related debt securities will be separately transferable;
(g) the principal amount of debt securities purchasable upon exercise of
each debt warrant and the price at which that principal amount of debt
securities may be purchased upon exercise of each debt warrant;
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(h) if applicable, the minimum or maximum number of warrants that may be
exercised at any one time;
(i) the date on which the right to exercise the debt warrants will
commence and the date on which the right will expire;
(j) if applicable, a discussion of United States federal income tax,
accounting or other considerations applicable to the debt warrants;
(k) whether the debt warrants represented by the debt warrant
certificates will be issued in registered or bearer form, and, if
registered, where they may be transferred and registered;
(l) anti-dilution provisions of the debt warrants, if any;
(m) redemption or call provisions, if any, applicable to the debt
warrants; and
(n) any additional terms of the debt warrants, including terms,
procedures and limitations relating to the exchange and exercise of the
debt warrants.
Debt warrant certificates will be exchangeable for new debt warrant
certificates of different denominations and, if in registered form, may be
presented for registration of transfer and debt warrants may be exercised at
the corporate trust office of the debt warrant agent or any other office
indicated in the related prospectus supplement. Before the exercise of debt
warrants, holders of debt warrants will not be entitled to payments of
principal, premium, if any, or interest, if any on the debt securities
purchasable upon exercise of the debt warrants, or to enforce any of the
covenants in the applicable indenture.
Equity Warrants
We may issue warrants for the purchase of our equity securities such as our
preferred stock or common stock. As explained below, each equity warrant will
entitle its holder to purchase equity securities at an exercise price set forth
in, or to be determinable as set forth in, the related prospectus supplement.
Equity warrants may be issued separately or together with equity securities.
The equity warrants are to be issued under equity warrant agreements to be
entered into between us and one or more banks or trust companies, as equity
warrant agent, as will be set forth in the prospectus supplement relating to
the equity warrants being offered by the prospectus supplement and this
prospectus. A copy of the equity warrant agreement, including a form of equity
warrant certificate representing the equity warranty, will be filed with the
SEC in connection with the offering of the equity warrants.
The particular terms of each issue of equity warrants, the equity warrant
agreement relating to the equity warrants and the equity warrant certificates
representing equity warrants will be described in the applicable prospectus
supplement, including, as applicable:
(a) the title of the equity warrants;
(b) the initial offering price;
(c) the aggregate number of equity warrants and the aggregate number of
shares of the equity security purchasable upon exercise of the equity
warrants;
(d) the currency or currency units in which the offering price, if any,
and the exercise price are payable;
(e) if applicable, the designation and terms of the equity securities
with which the equity warrants are issued, and the number of equity
warrants issued with each equity security;
(f) the date, if any, on and after which the equity warrants and the
related equity security will be separately transferable;
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(g) if applicable, the minimum or maximum number of the warrants that
may be exercised at any one time;
(h) the date on which the right to exercise the equity warrants will
commence and the date on which the right will expire;
(i) if applicable, a discussion of United States federal income tax,
accounting or other considerations applicable to the equity warrants;
(j) anti-dilution provisions of the equity warrants, if any;
(k) redemption or call provisions, if any, applicable to the equity
warrants; and
(l) any additional terms of the equity warrants, including terms,
procedures and limitations relating to the exchange and exercise of the
equity warrants.
Holders of equity warrants will not be entitled, solely by virtue of being
holders, to vote, to consent, to receive dividends, to receive notice as
shareholders with respect to any meeting of shareholders for the election of
directors or any other matter, or to exercise any rights whatsoever as a holder
of the equity securities purchasable upon exercise of the equity warrants.
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DESCRIPTION OF SECURITIES PURCHASE CONTRACTS AND SECURITIES PURCHASE UNITS
This section describes the general terms of the securities purchase
contracts and securities purchase units that Sempra Energy may offer and sell
by this prospectus. This prospectus and any accompanying prospectus supplement
will contain the material terms and conditions for each warrant. The
accompanying prospectus supplement may add, update or change the terms and
conditions of the securities purchase contracts and securities purchase units
as described in this prospectus. In this section, references to "we," "our" and
"us" mean Sempra Energy excluding, unless otherwise expressly stated or the
context otherwise requires, its subsidiaries.
Stock Purchase Contract and Stock Purchase Units
We may issue stock purchase contracts, representing contracts obligating
holders to purchase from us, and obligating us to sell to the holders, a
specified number of shares of common stock or preferred stock at a future date
or dates, or a variable number of shares of common stock or preferred stock for
a stated amount of consideration. The price per share and the number of shares
of common stock or preferred stock may be fixed at the time the stock purchase
contracts are issued or may be determined by reference to a specific formula
set forth in the stock purchase contracts. Any such formula may include anti-
dilution provisions to adjust the number of shares of common stock or preferred
stock issuable pursuant to the stock purchase contracts upon certain events.
The stock purchase contracts may be issued separately or as a part of units
consisting of a stock purchase contract and, as security for the holder's
obligations to purchase the shares under the stock purchase contracts, either
(a) our senior debt securities or subordinated debt securities, (b) our debt
obligations of third parties, including U.S. Treasury securities, or (c)
preferred securities of a trust. The stock purchase contracts may require us to
make periodic payments to the holders of the stock purchase units or vice
versa, and such payments may be unsecured or prefunded on some basis. The stock
purchase contracts may require holders to secure their obligations in a
specified manner and in certain circumstances we may deliver newly issued
prepaid stock purchase contracts upon release to a holder of any collateral
securing such holder's obligations under the original stock purchase contract.
Debt Purchase Contracts and Debt Purchase Units
We may issue debt purchase contracts, representing contracts obligating
holders to purchase from us, and obligating us to sell to the holders, a
specified principal amount of debt securities at a future date or dates. The
purchase price and the interest rate may be fixed at the time the debt purchase
contracts are issued or may be determined by reference to a specific formula
set forth in the debt purchase contracts.
The debt purchase contracts may be issued separately or as a part of units
consisting of a debt purchase contracts and, as security for the holder's
obligations to purchase the securities under the debt purchase contracts,
either (a) our senior debt securities or subordinated debt securities, (b) our
debt obligations of third parties, including U.S. Treasury securities, or (c)
preferred securities of a trust. The debt purchase contracts may require us to
make periodic payments to the holders of the debt purchase units or vice versa,
and such payments may be unsecured or prefunded on some basis. The debt
purchase contracts may require holders to secure their obligations in a
specified manner and in certain circumstances we may deliver newly issued
prepaid debt purchase contracts upon release to a holder of any collateral
securing such holder's obligations under the original debt purchase contract.
The applicable prospectus supplement will describe the general terms of any
purchase contracts or purchase units and, if applicable, prepaid purchase
contracts. The description in the prospectus supplement will not purport to be
complete and will be qualified in its entirety by reference to (a) the purchase
contracts, (b) the collateral arrangements and depositary arrangements, if
applicable, relating to such purchase contracts or purchase units and (c) if
applicable, the prepaid purchase contracts and the document pursuant to which
such prepaid purchase contracts will be issued. Material United States federal
income tax considerations applicable to the purchase contracts and the purchase
units will also be discussed in the applicable prospectus supplement.
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DESCRIPTION OF DEPOSITARY SHARES
This section describes the general terms of the depositary shares Sempra
Energy may offer and sell by this prospectus. This prospectus and any
accompanying prospectus supplement will contain the material terms and
conditions for the depositary shares. The accompanying prospectus supplement
may add, update, or change the terms and conditions of the depositary shares as
described in this prospectus. In this section, reference to "we," "our" and
"us" mean Sempra Energy excluding, unless otherwise expressly stated or the
context requires, its subsidiaries.
General
We may, at our option, elect to offer depositary shares, each representing a
fraction (to be set forth in the prospectus supplement relating to a particular
series of preferred stock) of a share of a particular class or series of
preferred stock as described below. In the event we elect to do so, depositary
receipts evidencing depositary shares will be issued to the public.
The shares of any class or series of preferred stock represented by
depositary shares will be deposited under a deposit agreement among us, a
depositary selected by us and the holders of the depositary receipts. The
depositary will be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least
$50,000,000. Subject to the terms of the deposit agreement, each owner of a
depositary share will be entitled, in proportion to the applicable fraction of
a share of preferred stock represented by such depositary share, to all the
rights and preferences of the shares of preferred stock represented by the
depositary share, including dividend, voting, redemption and liquidation
rights.
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
those persons purchasing the fractional shares of the related class or series
of preferred shares in accordance with the terms of the offering described in
the related prospectus supplement.
Pending the preparation of definitive depositary receipts the depositary
may, upon our written order, issue temporary depositary receipts substantially
identical to, and entitling the holders thereof to all the rights pertaining
to, the definitive depositary receipts but not in definitive form. Definitive
depositary receipts will be prepared without unreasonable delay, and temporary
depositary receipts will be exchangeable for definitive depositary receipts
without charge to the holder.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash
distributions received for the preferred stock to the entitled record holders
of depositary shares in proportion to the number of depositary shares that the
holder owns on the relevant record date, provided, however, that if we or the
depositary is required by law to withhold an amount on account of taxes, then
the amount distributed to the holders of depositary shares shall be reduced
accordingly. The depositary will distribute only an amount that can be
distributed without attributing to any holder of depositary shares a fraction
of one cent. The depositary will add the undistributed balance to and treat it
as part of the next sum received by the depositary for distribution to holders
of the depositary shares.
If there is a non-cash distribution, the depositary will distribute property
received by it to the entitled record holders of depositary shares, in
proportion, insofar as possible, to the number of depositary shares owned by
the holders, unless the depositary determines, after consultation with us, that
it is not feasible to make such distribution. If this occurs, the depositary
may, with our approval, sell such property and distribute the net proceeds from
such sale to the holders. The deposit agreement also will contain provisions
relating to how any subscription or similar rights that we may offer to holders
of the preferred stock will be available to the holders of the depositary
shares.
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Withdrawal of Shares
Upon surrender of the depositary receipts at the corporate trust office of
the depositary unless the related depositary shares have previously been called
for redemption, converted or exchanged into our other securities, the holder of
the depositary shares evidenced thereby is entitled to delivery of the number
of whole shares of the related class or series of preferred stock and any money
or other property represented by such depositary shares. Holders of depositary
receipts will be entitled to receive whole shares of the related class or
series of preferred stock on the basis set forth in the prospectus supplement
for such class or series of preferred stock, but holders of such whole shares
of preferred stock will not thereafter be entitled to exchange them for
depositary shares. If the depositary receipts delivered by the holder evidence
a number of depositary shares in excess of the number of depositary shares
representing the number of whole shares of preferred stock to be withdrawn, the
depositary will deliver to such holder at the same time a new depositary
receipt evidencing such excess number of depositary shares. In no event will
fractional shares of preferred stock be delivered upon surrender of depositary
receipts to the depositary.
Conversion, Exchange and Redemption
If any class or series of preferred stock underlying the depositary shares
may be converted or exchanged, each record holder of depositary receipts
representing the shares of preferred stock being converted or exchanged will
have the right or obligation to convert or exchange the depositary shares
represented by the depositary receipts.
Whenever we redeem or convert shares of preferred stock held by the
depositary, the depositary will redeem or convert, at the same time, the number
of depositary shares representing the preferred stock to be redeemed or
converted. The depositary will redeem the depositary shares from the proceeds
it receives from the corresponding redemption of the applicable series of
preferred stock. The depositary will mail notice of redemption or conversion to
the record holders of the depositary shares that are to be redeemed between 30
and 60 days before the date fixed for redemption or conversion. The redemption
price per depositary share will be equal to the applicable fraction of the
redemption price per share on the applicable class or series of preferred
stock. If less than all the depositary shares are to be redeemed, the
depositary will select which shares are to be redeemed by lot on a pro rata
basis or by any other equitable method as the depositary may decide.
After the redemption or conversion date, the depositary shares called for
redemption or conversion will no longer be outstanding. When the depositary
shares are no longer outstanding, all rights of the holders will end, except
the right to receive money, securities or other property payable upon
redemption or conversion.
Voting the Preferred Stock
When the depositary receives notice of a meeting at which the holders of the
particular class or series of preferred stock are entitled to vote, the
depositary will mail the particulars of the meeting to the record holders of
the depositary shares. Each record holder of depositary shares on the record
date may instruct the depositary on how to vote the shares of preferred stock
underlying the holder's depositary shares. The depositary will try, if
practical, to vote the number of shares of preferred stock underlying the
depositary shares according to the instructions. We will agree to take all
reasonable action requested by the depositary to enable it to vote as
instructed.
Amendment and Termination of the Deposit Agreement
We and the depositary may agree at any time to amend the deposit agreement
and the depositary receipt evidencing the depositary shares. Any amendment that
(a) imposes or increases certain fees, taxes or other charges payable by the
holders of the depositary shares as described in the deposit agreement that (b)
otherwise materially adversely affects any substantial existing rights of
holders of depositary shares, will not take effect until such amendment is
approved by the holders of at least a majority of the depositary shares then
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outstanding. Any holder of depositary shares that continue to hold its shares
after such amendment has become effective will be deemed to have agreed to the
amendment.
We may direct the depositary to terminate the deposit agreement by mailing a
notice of termination of holders of depositary shares at least 30 days prior to
termination. The depositary may terminate the deposit agreement if 90 day have
elapsed after the depositary delivered written notice of its election to resign
and a successor depositary is not appointed. In addition, the deposit agreement
will automatically terminate if:
. the depositary has redeemed all related outstanding depositary shares;
. all outstanding shares of preferred stock have been converted into or
exchanged for common stock; or
. we have liquidated, terminated or wound up our business and the
depositary has distributed the preferred stock of the relevant series to
the holders of the related depositary shares.
Reports and Obligations
The depositary will forward to the holders of depositary shares all reports
and communications from us that are delivered to the depositary and that we are
required by law, the rules of an applicable securities exchange or our amended
and restated certificate of incorporation to furnish to the holders of the
preferred stock. Neither we nor the depositary will be liable if the depositary
is prevented or delayed by law or any circumstances beyond its control in
performing its obligations under the deposit agreement. The deposit agreement
limits our obligations to performance in good faith of the duties stated in the
deposit agreement. The depositary assumes no obligation and will not be subject
to liability under the deposit agreement except to perform such obligations as
are set forth in the deposit agreement without negligence or bad faith. Neither
we nor the depositary will be obligated to prosecute or defend any legal
proceeding connected with any depositary shares or class or series of preferred
stock unless the holders of depositary shares requesting us to do so furnish us
with a satisfactory indemnity. In performing our obligations, we and the
depositary may rely and act upon the advice of our counsel or accountants, on
any information provided to us by a person presenting shares for deposit, any
holder of a receipt, or any other document believed by us or the depositary to
be genuine and to have been signed or presented by the proper party or parties.
Payment of Fees and Expenses
We will pay all fees, charges and expenses of the depositary, including the
initial deposit of the preferred stock and any redemption of the preferred
stock. Holders of depositary shares will pay taxes and governmental charges and
any other charges as are stated in the deposit agreement for their accounts.
Resignation and Removal of Depositary
At any time, the depositary may resign by delivering notice to us, and we
may remove the depositary at any time. Resignations or removals will take
effect upon the appointment of a successor depositary and its acceptance of the
appointment. The successor depositary must be appointed within 90 days after
the delivery of the notice of resignation or removal and must be a bank or
trust company having its principal office in the United States and having a
combined capital and surplus of at least $50,000,000.
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DESCRIPTION OF TRUST PREFERRED SECURITIES
This section describes the general terms of the trust preferred securities
that Sempra Energy may offer and sell by this prospectus. This prospectus and
any accompanying prospectus supplement will contain the material terms and
conditions for each trust preferred security. The accompanying prospectus
supplement may add, update or change the terms and conditions of the trust
preferred securities as described in this prospectus. In this section,
references to "we," "our" and "us" mean Sempra Energy excluding, unless
otherwise expressly stated or the context otherwise requires, its subsidiaries.
General
Each Declaration authorizes the regular trustees to issue on behalf of each
trust one series of trust preferred securities which will have the terms
described below and in a prospectus supplement. Each trust will use the net
proceeds from the sale of trust preferred securities and trust common
securities to purchase a series of subordinated debt securities from us. The
property trustee will hold legal title to such subordinated debt securities in
trust for the benefit of the holders of the applicable trust preferred
securities. We will guarantee the payment of distributions and other amounts
payable on the trust preferred securities, but only to the extent that the
trust has funds legally and immediately available to make those payments. The
trust preferred securities and trust common securities of a trust are referred
to herein as the "trust securities."
Each trust preferred securities guarantee, when taken together with our
obligation under the related series of subordinated debt securities, the
subordinated indenture and the related Declaration, will provide a full and
unconditional guarantee of amounts due on the trust preferred securities issued
by a trust.
Each Declaration will be qualified as an indenture under the Trust Indenture
Act. Each property trustee will act as indenture trustee for the trust
preferred securities, in order to comply with the provisions of the Trust
Indenture Act.
The trust preferred securities will be represented by a global security that
will be deposited with and registered in the name of The Depository Trust
Company ("DTC") or its nominee. Whenever we refer to a "holder" of trust
preferred securities in this prospectus, we mean the registered holder, which,
for any trust preferred securities in book-entry form, will be DTC or its
nominee. We discuss various matters relevant to global securities under "Global
Securities--Book-Entry, Delivery and Form" below.
Each series of trust preferred securities will have the terms, including
distributions, redemption, voting, liquidation rights and the other preferred,
deferred or other special rights or other restrictions as described in the
relevant Declaration or made part of the Declaration by the Trust Indenture Act
or the Delaware Business Trust Act. The terms of the trust preferred securities
will mirror the terms of the subordinated debt securities held by the trust.
The prospectus supplement relating to the trust preferred securities of a
trust will describe the specific terms of the trust preferred securities,
including:
(a) the name of the trust preferred securities;
(b) the dollar amount and number of trust preferred securities issued;
(c) any provision relating to deferral of distribution payments, if
different from those described in this prospectus;
(d) the annual distribution rate(s) (or method of determining the
rate(s)), the payment date(s) and the record dates used to determine the
holders who are to receive distributions;
(e) the date from which distributions shall be cumulative;
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(f) the optional redemption provisions, if any, including the prices,
time periods and other terms and conditions for which the trust preferred
securities shall be purchased or redeemed, in whole or in part;
(g) the terms and conditions, if any, upon which the applicable series
of subordinated debt securities may be distributed to holders of the trust
preferred securities, if different from those described in this prospectus;
(h) the voting rights, if any, of holders of the trust preferred
securities, if different from those described in this prospectus;
(i) any securities exchange on which the trust preferred securities will
be listed;
(j) whether the trust preferred securities are to be issued in book-
entry form and represented by one or more global certificates and, if so,
the depository for the global certificates and the specific terms of the
depositary arrangements, if different from those described in this
prospectus; and
(k) any other relevant rights, preferences, privileges, limitations or
restrictions of the trust preferred securities, if different from those
described in this prospectus.
Each prospectus supplement will describe certain United States federal
income tax considerations applicable to the purchase, holding and disposition
of the series of trust preferred securities covered by the prospectus
supplement, if different from those described in this prospectus.
Distributions
Distributions will accumulate on each series of trust preferred securities
from the date they are first issued. Unless deferred as described below,
distributions will be payable quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year (each, a "distribution date").
Distributions not paid when due will accumulate additional distributions,
compounded quarterly, at the annual rate stated in the related prospectus
supplement, to the extent permitted by law. Whenever we use the term
"distributions" in this prospectus, we are including any of these
distributions. The amount of distributions payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months.
The assets of a trust available for distribution to holders of trust
preferred securities will be limited to the interest payments the trust
receives from us with respect to the subordinated debt securities.
Consequently, if we defer or for any other reason fail to make interest
payments on the subordinated debt securities, the trust will not have funds to
pay distributions on the trust preferred securities.
As long as no Subordinated Indenture Event of Default (as defined in the
subordinated indenture for the subordinated debt securities held by a trust)
has occurred and has not been cured, we will have the right to defer interest
payments on the related subordinated debt securities at any time. We may defer
interest payments on the related subordinated debt securities in each case for
a period not exceeding 20 consecutive quarters (each, a "deferral period"). No
deferral period may extend beyond the stated maturity of the related
subordinated debt securities. Before a deferral period ends, we may extend it
further if that deferral period does not exceed 20 consecutive quarters or
extend beyond the stated maturity of the related subordinated debt securities.
When a deferral period ends and we have paid all accrued and unpaid interest on
the related subordinated debt securities, we may begin a new deferral period,
subject to the terms described above. There is no limit on the number of
deferral periods that we may begin.
If we defer interest payments on the related subordinated debt securities,
the trust also will defer the payment of distributions on the trust preferred
securities. During a deferral period, the holder of trust preferred securities
will still accumulate distributions at the annual rate specified in the related
prospectus supplement, plus the holder of trust preferred securities will
accumulate additional distributions on the deferred distributions at the same
rate, to the extent permitted by law. During a deferral period, the holder of
trust preferred securities will be required to accrue interest income for
United States federal income tax purposes as discussed under the
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caption "Certain United States Federal Income Tax Consequences--Trust Preferred
Securities--Interest Income and Original Issue Discount" below.
If we elect to begin a deferral period, we will be subject to specified
restrictions relating to paying dividends on or repurchasing our common stock
and making payments on certain of our debt securities. See "Description of the
Subordinated Debt Securities of Sempra Energy Purchased with Proceeds of Trust
Securities--Payments--Deferral Period Restrictions" below.
Redemption
Trust preferred securities will remain outstanding until the applicable
trust redeems them or distributes the subordinated debt securities in exchange
for the trust preferred securities. Any redemption of trust preferred
securities must occur as described below. Any exchange distribution must occur
as described below under the caption "--Exchange of Trust Preferred Securities
for Subordinated Debt Securities."
Redemption of Trust Preferred Securities
If we repay or redeem the related subordinated debt securities, whether at
their stated maturity, upon acceleration after a Subordinated Indenture Event
of Default or upon early redemption, the applicable property trustee will
redeem a Like Amount of trust preferred securities of the applicable trust on
the Redemption Date at the Redemption Price. In this context, "Like Amount"
means trust preferred securities having an aggregate liquidation amount equal
to the aggregate principal amount of the subordinated debt securities being
repaid or redeemed. "Redemption Date" means the date that the principal of the
subordinated debt securities being redeemed becomes due for payment under the
subordinated indenture. "Redemption Price" means the aggregate liquidation
amount of the trust preferred securities to be redeemed, plus any accumulated
and unpaid distributions on those securities to the Redemption Date.
Repayment and Redemption of Subordinated Debt Securities
We may redeem any series of subordinated debt securities, at our option,
before their stated maturity as follows:
. at any time on or after the date stated in an applicable prospectus
supplement, in whole or in part, provided that no partial redemption may
occur during a deferral period; and
. at any time in whole, but not in part, within 90 days after a Tax Event
or an Investment Company Act Event has occurred.
See "Description of the Subordinated Debt Securities of Sempra Energy
Purchased with Proceeds of Trust Securities--Optional Redemption" below for the
definitions of "Tax Event" and "Investment Company Act Event."
If a Tax Event is continuing and we do not elect to dissolve a trust or
redeem the related subordinated debt securities, we may be required to pay
additional sums on such subordinated debt securities. The provisions regarding
repayment and redemption of subordinated debt securities, as well as
information about the effect that possible tax law changes may have on the
subordinated debt securities and trust preferred securities, are discussed in
"Description of the Subordinated Debt Securities of Sempra Energy Purchased
with Proceeds of Trust Securities--Stated Maturity" and "--Optional
Redemption--Payment of Additional Sums" below.
Redemption Procedures
A property trustee will give at least 30 days, but not more than 60 days,
notice before the Redemption Date, unless the redemption results from
acceleration after a Subordinated Indenture Event of Default and the property
trustee is not able to give notice during this period. In that case, a property
trustee will give the notice
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as soon as practicable. A property trustee will give the notice of redemption
in the manner described below under the caption "--Notices."
The property trustee will irrevocably deposit with DTC (in the case of any
book-entry trust preferred securities) or the Paying Agent (as defined below)
(in the case of any non-book-entry trust preferred securities) funds sufficient
to pay the Redemption Price for all trust preferred securities being redeemed
on that date, to the extent that such funds are deposited with the property
trustee. The property trustee will deposit such funds by 2:00 p.m., New York
City time, on the Redemption Date provided that the property trustee has
received such funds by 10:00 a.m. New York City time on such Redemption Date.
DTC will pay the Redemption Price for trust preferred securities held in
book-entry form and called for redemption in accordance with the procedures of
DTC, to the extent the property trustee has deposited sufficient funds with
DTC. The Paying Agent will pay the Redemption Price for trust preferred
securities held in definitive form and called for redemption, to the extent the
property trustee has deposited sufficient funds with the Paying Agent, against
surrender of the certificates representing those trust preferred securities.
The trust preferred securities will be issued in definitive form only in the
special circumstances described under the caption "Book-Entry Issuance--Global
Securities" below. Any distributions that are due on a distribution date that
is on or before the Redemption Date will be payable to the holders of those
trust preferred securities on the record date for the related distribution
date.
Once the property trustee gives notice of redemption and deposits funds as
discussed above, all rights of the holders of the trust preferred securities
called for redemption will cease at the time of the deposit, except the right
of those holders to receive the Redemption Price, but without interest on that
amount. In addition, those trust preferred securities will no longer be
outstanding.
On the Redemption Date, distributions will stop accumulating on the
subordinated debt securities called for redemption. However, if payment of the
Redemption Price for any trust preferred securities is not made, distributions
on those trust preferred securities will continue to accumulate to the date the
Redemption Price is paid.
If a trust redeems less than all of its trust preferred securities, then the
liquidation amount of trust preferred securities to be redeemed will be
allocated pro rata between its outstanding trust preferred securities and its
outstanding trust common securities, based upon their respective aggregate
liquidation amounts. The applicable property trustee will select the trust
preferred securities to be redeemed from among the outstanding trust preferred
securities of such trust not previously called for redemption. A property
trustee may use any method of selection that it deems to be fair and
appropriate.
Other Purchases of Trust Preferred Securities
We or our subsidiaries may purchase outstanding trust preferred securities
by tender, in the open market or by private agreement, subject to applicable
laws, including United States federal securities laws.
Exchange of Trust Preferred Securities for Subordinated Debt Securities
We will have the right at any time, in our sole discretion, to dissolve a
trust. After a trust has satisfied all liabilities to its creditors, as
provided by law, the applicable property trustee will distribute a Like Amount
of subordinated debt securities to the holders of the related trust securities
in exchange for all such trust securities outstanding, in liquidation of the
trust. In this context, "Like Amount" means subordinated debt securities having
an aggregate principal amount equal to the aggregate liquidation amount of all
such trust securities outstanding.
If an exchange distribution with respect to a trust occurs, we must use our
best efforts to list the related subordinated debt securities on the New York
Stock Exchange or such other stock exchange or organization, if any, on which
the trust preferred securities of such trust are listed.
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Exchange Procedures
A property trustee will make the exchange distribution to holders of trust
preferred securities listed in a trust's records at the close of business on
the record date for the exchange distribution. If the trust preferred
securities are held in book-entry form, the record date will be one Business
Day (as defined below) before the date that we set as the exchange distribution
date (the "Exchange Date"). If the trust preferred securities are not held in
book-entry form, the record date will be the 15th day (whether or not a
Business Day) before the Exchange Date.
A property trustee will give holders at least 30 days, but not more than 60
days, notice before the Exchange Date. Property trustees will give the notice
of an Exchange Date in the manner described below under "--Notices."
On the Exchange Date with respect to a trust:
. the trust preferred securities of such trust will no longer be
outstanding;
. certificates representing a Like Amount of subordinated debt securities
will be issued to holders of trust preferred securities of such trust
upon their surrender to the property trustee or its agent for exchange;
. any certificates representing trust preferred securities of such trust
that are not surrendered for exchange will be deemed to represent a Like
Amount of subordinated debt securities (and until such certificates are
surrendered for exchange, no payments of interest or principal on such
subordinated debt securities will be made to the holders of those trust
preferred securities); and
. the holders of trust preferred securities of such trust will not have
any further rights with respect to such trust preferred securities,
except the right to receive certificates representing subordinated debt
securities upon surrender of their certificates as described above.
Certain Tax Consequences
Under current United States federal income tax law and interpretations and
assuming, as each trust expects, that it will not be classified as an
association taxable as a corporation, a holder of trust preferred securities
would not be taxed if a property trustee distributes subordinated debt
securities to it upon liquidation of the trust. However, if a Tax Event were to
occur and a trust were subject to taxation on income received or accrued on
subordinated debt securities, a holder of trust preferred securities and the
trust could be taxed on that distribution as described under the caption
"Certain United States Federal Income Tax Consequences-- Trust Preferred
Securities--Distribution of Subordinated Debt Securities to Holders of Trust
Preferred Securities Upon Liquidation of the Trust" below.
Ranking
The trust preferred securities of a trust will rank equally with the trust
common securities of that trust. A trust will make payments of distributions
and the Redemption Price on the trust preferred securities and the trust common
securities pro rata, based on the aggregate liquidation amounts of the trust
preferred securities and trust common securities, except as follows. If a
Subordinated Indenture Event of Default has occurred with respect to the series
of subordinated debt securities held by a trust and has not been cured, that
trust may not make any payments on its trust common securities until the trust
has paid in full or provided in full all unpaid amounts on its trust preferred
securities.
If a Subordinated Indenture Event of Default occurs with respect to the
series of subordinated debt securities held by a trust, the holders of the
trust common securities of that trust will be deemed to have waived all rights
to act with respect to the related Declaration Event of Default with respect to
that trust (as defined below) until all such Declaration Events of Default have
been cured, waived or eliminated. Until any such
35
Declaration Events of Default have been cured, waived or eliminated, the
property trustee of that trust will act solely on behalf of holders of the
trust preferred securities of that trust (and not on behalf of the holders of
the trust common securities of that trust), and only the holders of trust
preferred securities of that trust will have the right to direct the property
trustee to act on their behalf.
Status of Trust Preferred Securities Guarantees
Each trust preferred securities guarantee will constitute our unsecured
obligation and will rank:
(a) equal in rank with any other guarantee similar to the trust
preferred securities guarantees issued by us on behalf of the holders of
securities issued by any other trust established by us or our affiliates;
(b) subordinate and junior in right of payment to all of our other
liabilities, except those that rank equally or are subordinate by their
terms;
(c) equal with any guarantee now or hereafter issued by us in respect of
the most senior preferred or preference stock now or hereafter issued by
us, and with any guarantee now or hereafter issued by us in respect of any
preferred or preference stock of any of our affiliates; and
(d) senior to our common stock.
Each Declaration will require that the holders of the related trust
preferred securities accept the subordination provisions and other terms of the
related trust preferred securities guarantee. A trust preferred securities
guarantee will constitute a guarantee of payment and not of collection (in
other words the holder of a trust preferred securities guarantee may sue us, or
seek other remedies, to enforce its rights under the trust preferred securities
guarantee without first suing any other person or entity). A trust preferred
securities guarantee will not be discharged except by payment of the trust
preferred securities guarantee payments in full to the extent not previously
paid or upon distribution of subordinated debt securities to the holders of the
trust preferred securities pursuant to the related Declaration.
Liquidation Distribution Upon Dissolution
Each Declaration states that the related trust shall be dissolved:
(a) upon the expiration of the term of such trust;
(b) upon the bankruptcy of Sempra Energy;
(c) upon the filing of a certificate of dissolution or its equivalent
with respect to Sempra Energy;
(d) 90 days after the revocation of the articles of incorporation of
Sempra Energy (but only if the articles of incorporation are not reinstated
during that 90-day period);
(e) upon the written direction to the property trustee from Sempra
Energy at any time to dissolve such trust and distribute the related
subordinated debt securities to holders in exchange for the trust preferred
securities;
(f) upon the redemption of all of the trust securities of such trust; or
(g) upon entry of a court order for the dissolution of Sempra Energy or
such trust.
In the event of a dissolution, after a trust satisfies (whether by payment
or reasonable provision for payment) all amounts owed to creditors of the
trust, the holders of the trust securities of such trust will be entitled to
receive:
(a) cash equal to the aggregate liquidation amount of each trust
security, plus accumulated and unpaid distributions to the date of payment;
unless
(b) subordinated debt securities in an aggregate principal amount equal
to the aggregate liquidation amount of the trust securities are distributed
to the holders of the trust securities.
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If a trust cannot pay the full amount due on its trust securities because
insufficient assets are available for payment, then the amounts payable by the
trust on its trust securities shall be paid pro rata. However, if an event of
default under the related Declaration has occurred, the total amounts due on
the trust preferred securities will be paid before any distribution on the
trust common securities.
Declaration Events of Default
The term "Declaration Event of Default" with respect to a trust means any of
the following:
. Subordinated Indenture Event of Default occurs with respect to the
related series of subordinated debt securities (see "Description of the
Subordinated Debt Securities of Sempra Energy Purchased with Proceeds of
Trust Securities--Events of Default" below);
. such trust does not pay any distribution within 30 days of its due date,
provided that no deferral period is continuing;
. such trust does not pay any Redemption Price on its due date;
. the securities trustee of such trust remains in breach in a material
respect of any term of the related Declaration for 90 days after the
securities trustee receives notice of default stating the securities
trustee is in breach. The notice must be sent by the holders of at least
25% in liquidation amount of the outstanding trust preferred securities
of such trust; and
. the property trustee of such trust files for bankruptcy or certain other
events in bankruptcy or insolvency occur and a successor property
trustee of such trust is not appointed within 60 days.
If a Subordinated Indenture Event of Default occurs and the subordinated
indenture trustee and the holders of not less than 25% in principal amount of
the outstanding subordinated debt securities of the related series fail to
declare the principal of all of such subordinated debt securities to be
immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the outstanding trust preferred securities of the related
trust will have the right to declare such principal immediately due and
payable, by providing notice to us and the subordinated indenture trustee.
If we fail to pay principal, premium, if any, or interest on a series of
subordinated debt securities when payable, then a holder of the related trust
preferred securities may directly sue us or seek other remedies to collect its
pro rata share of payments owed.
Within 90 days after learning of a Declaration Event of Default with respect
to a trust, the related property trustee will notify the holders of the trust
securities of such trust, the regular trustees and us, unless the Declaration
Event of Default has been cured or waived.
We and a regular trustee of a trust must provide the property trustee of
such trust with an annual certificate stating whether they are in compliance
with all the conditions and covenants applicable to them under the related
Declaration.
If a Declaration Event of Default with respect to a trust has occurred and
has not been cured, the trust preferred securities of such trust will have a
preference in right of payment over the trust common securities of such trust
as discussed above. The holders of trust securities are not entitled to
accelerate the maturity of the trust preferred securities upon a Declaration
Event of Default.
Enforcement Rights
If a Subordinated Indenture Event of Default occurs with respect to a series
of subordinated debt securities, the holders of the related trust preferred
securities must rely on the applicable property trustee, as the
37
holder of such subordinated debt securities, to enforce its rights under such
subordinated debt securities and the applicable subordinated indenture against
us, subject to the following:
Right of Direct Action
If we do not make full and timely payments on such subordinated debt
securities, the related trust will not have funds available to make payments of
distributions or other amounts due on the related trust preferred securities.
In this event, a holder of such trust preferred securities may sue us directly
to collect its pro rata share of payments owed. We may not amend the applicable
subordinated indenture to remove the right of any holder of trust preferred
securities to bring a direct action against us without the prior written
consent of all of the holders of the related series of trust preferred
securities. We will be able to set-off any payment made to a holder of trust
preferred securities in connection with a direct action.
Other Rights under the Subordinated Indenture
The holders of 25% or more in liquidation amount of the outstanding trust
preferred securities of a trust may accelerate the maturity of the related
series of subordinated debt securities when a Subordinated Indenture Event of
Default with respect to such series has occurred and has not been cured and
neither the subordinated indenture trustee nor the holders of the related
series of subordinated debt securities have exercised such acceleration rights.
In addition, the holders of a majority in liquidation amount of the outstanding
trust preferred securities of a trust may cancel a declaration of acceleration
of the related series of subordinated debt securities and may waive specified
Subordinated Indenture Events of Default with respect to such series. See
"Description of the Subordinated Debt Securities of Sempra Energy Purchased
with Proceeds of Trust Securities--Events of Default" and "--Remedies" below.
Voting Rights; Amendment of the Declaration
The holders of the trust preferred securities of a trust will have no voting
rights except as discussed below and under "Description of the Subordinated
Debt Securities of Sempra Energy Purchased with Proceeds of Trust Securities--
Consolidation, Merger and Conveyance of Assets as an Entirety; No Financial
Covenants" and "Description of Trust Preferred Securities Guarantees--
Amendments and Assignment" below, and as otherwise required by law or the
applicable Declaration.
With respect to a trust, if any proposed amendment to the applicable
Declaration provides for, or the regular trustees of such trust otherwise
propose to effect:
(a) any action that would adversely affect the powers, preferences or
special rights of the trust preferred securities of such trust in any
material respect, whether by way of amendment to the applicable Declaration
or otherwise; or
(b) the dissolution, winding-up or termination of such trust other than
pursuant to the terms of the applicable Declaration,
then the holders of the trust preferred securities of such trust as a class
will be entitled to vote on the amendment or proposal. In that case, the
amendment or proposal will be effective only if approved by the holders of at
least a majority in aggregate liquidation amount of such trust preferred
securities.
A Declaration may be amended from time to time by us and the applicable
property trustee and the applicable regular trustees without the consent of the
holders of trust preferred securities of the related trust, to:
(a) cure any ambiguity, correct or supplement any provision which may be
inconsistent with any other provision, or make provisions not inconsistent
with any other provisions with respect to matters or questions arising
under the applicable Declaration, in each case to the extent that the
amendment does not adversely affect the interests of any holder of trust
preferred securities of the related trust in any material respect; or
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(b) modify, eliminate or add to any provisions to the extent necessary
to ensure that the related trust will not be classified as other than a
grantor trust for United States federal income tax purposes or to ensure
that such trust will not be required to register as an "investment company"
under the Investment Company Act.
Except as provided in the next paragraph, other amendments to a Declaration
may be made by us or the securities trustees of the related trust upon:
(a) approval of the holders of a majority in aggregate liquidation
amount of the outstanding trust preferred securities of such trust; and
(b) receipt by the securities trustee of such trust of an opinion of
counsel to the effect that such amendment will not affect the trust's
status as a grantor trust for United States federal income tax purposes or
the trust's exemption from the Investment Company Act.
Notwithstanding the foregoing, without the consent of each affected holder
of the trust securities of the related trust, a Declaration may not be amended
to:
(a) change the amount or timing of any distribution on the trust
securities of such trust or otherwise adversely affect the amount of any
distribution required to be made in respect of the trust securities of such
trust as of a specified date; or
(b) restrict the right of a holder of the trust securities of such trust
to institute suit for the enforcement of any such payment on or after such
date.
In addition, no amendment may be made to a Declaration if the amendment
would:
(a) cause the related trust to be characterized as other than a grantor
trust for United States federal income tax purposes;
(b) cause the related trust to be deemed to be an "investment company"
which is required to be registered under the Investment Company Act; or
(c) impose any additional obligation on us, the property trustee of the
related trust or the Delaware trustee of the related trust without its
consent.
Without obtaining the prior approval of the holders of a majority in
aggregate liquidation amount of the trust preferred securities of a trust, the
securities trustees of such trust may not:
(a) direct the time, method and place of conducting any proceeding for
any remedy available to the related subordinated indenture trustee or
executing any trust or power conferred on the related property trustee with
respect to the related series of subordinated debt securities;
(b) waive any default that is waivable under the subordinated indenture;
(c) cancel an acceleration of the principal of the related series of
subordinated debt securities; or
(d) consent to any amendment, modification or termination of the
subordinated indenture or the related series of subordinated debt
securities where such consent is required.
However, if a consent under the subordinated indenture requires the consent
of each affected holder of a series of subordinated debt securities, then the
applicable property trustee must obtain the prior consent of each holder of the
related trust preferred securities. In addition, before taking any of the
foregoing actions, the regular trustees of the related trust must obtain an
opinion of counsel stating that the action will not cause such trust to be
classified as other than a grantor trust for United States federal income tax
purposes.
The property trustee of a trust will notify all holders of the trust
preferred securities of such trust of any notice of default received from the
subordinated indenture trustee with respect to the subordinated debt securities
held by such trust.
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Notices
Notices to be given to holders of trust preferred securities held in book-
entry form will be given to DTC in accordance with its procedures. Notices to
be given to holders of trust preferred securities held in definitive form may
be given by mail to their addresses set forth in trust records.
Payment and Paying Agency
With respect to any trust preferred securities held in book-entry form,
distributions will be paid to DTC, which will credit the relevant accounts at
DTC on the applicable distribution dates in accordance with its procedures.
With respect to any trust preferred securities issued in definitive form,
distributions will be paid by check mailed to the address of the holder
entitled to such payments, as such address appears in trust records. The paying
agent of a trust (the "Paying Agent") will initially be the property trustee of
such trust. A Paying Agent of a trust may resign upon 30 days written notice to
the regular trustees and the property trustee of such trust. In such event, the
property trustee of such trust will appoint a successor acceptable to the
regular trustees of such trust to act as Paying Agent.
Persons holding their trust preferred securities in "street name" or
indirectly through DTC should consult their banks or brokers for information on
how they will receive payments. See "Global Securities--Book-Entry, Delivery
and Form" in this prospectus.
Any money paid to a property trustee or a Paying Agent for payments on trust
preferred securities that remains unclaimed at the end of two years after the
amount is due will be repaid to us. After that two-year period, you may look
only to us for payment of those amounts.
Business Day
If any payment is due on a day that is not a Business Day, the payment will
be made on the following Business Day (unless that Business Day is in a
different calendar year, in which case the payment will be made on the
preceding Business Day). Each payment made on the following or preceding
Business Day will have the same force and effect as if made on the original
payment due date. "Business Day" means any day other than a Saturday, a Sunday,
a day on which banking institutions in New York City are authorized or required
by law or executive order to remain closed or, with respect to such trust, a
day on which the corporate trust office of the property trustee of such trust
or the subordinated indenture trustee is closed for business.
Record Date
A trust will pay distributions to holders of trust preferred securities
listed in the trust's records on the record date for the payment. If trust
preferred securities are held in book-entry form, the record date will be one
Business Day before the relevant distribution date. If trust preferred
securities are issued in definitive form, the record date will be the 15th day,
whether or not a Business Day, before the relevant distribution date.
Registrar and Transfer Agent
The property trustee of a trust will initially act as such trust's agent for
registering trust preferred securities of such trust in the names of holders
and transferring such trust preferred securities. Such property trustee also
will perform the role of maintaining the list of registered holders of trust
preferred securities of such trust. Holders will not be required to pay a
service charge to transfer or exchange trust preferred securities, but may be
required to pay for any tax or other governmental charge associated with the
exchange or transfer.
Removal and Replacement of Trustees
Only the holder of trust common securities of a trust has the right to
remove, or replace the regular trustees and, prior to an event of default,
property and Delaware trustees of the trust. If an event of default
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occurs, only the holders of trust preferred securities of a trust have the
right to remove or replace the property and Delaware trustees. The resignation
or removal of any trustee and the appointment of a successor trustee shall be
effective only on the acceptance of appointment by the successor trustee in
accordance with the provisions of the Declaration for such trust.
Information Concerning the Property Trustees
For matters relating to compliance with the Trust Indenture Act, the
property trustee of each trust will have all of the duties and responsibilities
of an indenture trustee under the Trust Indenture Act. Each property trustee,
other than during the occurrence and continuance of a Declaration Event of
Default under the applicable trust, undertakes to perform only the duties as
are specifically set forth in the applicable Declaration and, upon a
Declaration event of default, must use the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs.
Subject to this provision, a property trustee is under no obligation to
exercise any of the powers given it by the applicable Declaration at the
request of any holder of trust preferred securities unless it is offered
reasonable security or indemnity against the costs, expenses and liabilities
that it might incur. However, the holders of the trust preferred securities
will not be required to offer an indemnity where the holders, by exercising
their voting rights, direct the property trustee to take any action following a
Declaration event of default.
Miscellaneous
The regular trustees of each trust are authorized and directed to conduct
the affairs of and to operate the trust in such a way that:
(a) it will not be deemed to be an "investment company" required to be
registered under the Investment Company Act;
(b) it will be classified as a grantor trust for United States federal
income tax purposes; and
(c) the subordinated debt securities held by it will be treated as
indebtedness of us for United States federal income tax purposes.
We and the regular trustees of a trust are authorized to take any action (so
long as it is consistent with applicable law or the applicable certificate of
trust or Declaration) that we and the regular trustees of the trust determine
to be necessary or desirable for such purposes.
Registered holders of trust preferred securities have no preemptive or
similar rights.
A trust may not borrow money, issue debt, execute mortgages or pledge any of
its assets.
Governing Law
Each Declaration and the related trust preferred securities will be governed
by and construed in accordance with the laws of the State of Delaware.
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DESCRIPTION OF THE SUBORDINATED DEBT SECURITIES OF SEMPRA ENERGY
PURCHASED WITH PROCEEDS OF TRUST SECURITIES
This section describes the general terms of the subordinated debt securities
of Sempra Energy purchased with the proceeds of trust securities that may be
offered and sold by this prospectus. This prospectus and any accompanying
prospectus supplement will contain the material terms and conditions for each
subordinated debt security. The accompanying prospectus supplement may add,
update or change the terms and conditions of the subordinated debt securities
as described in this prospectus. In this section, references to "we," "our" and
"us" mean Sempra Energy excluding, unless otherwise expressly stated or the
context otherwise requires, its subsidiaries.
General
Following the issuance of trust securities by a trust, the trust will use
the proceeds of such issuance to purchase a series of subordinated debt
securities. The property trustee of such trust will hold legal title to such
series of subordinated debt securities in trust for the benefit of the holders
of the trust securities of such trust.
The subordinated indenture will be qualified as an indenture under the Trust
Indenture Act. The subordinated indenture trustee will act as indenture trustee
for the subordinated debt securities, in order to comply with the provisions of
the Trust Indenture Act.
The subordinated debt securities will not be secured by any of our property
or assets. The subordinated debt securities will rank junior in priority of
payment to specified existing and future debt and other liabilities of ours
which are described below under "--Subordination."
Payments
We will pay interest to the direct holders of subordinated debt securities
listed in our records at the close of business on the record date, as discussed
below, in advance of each interest payment date. If a series of subordinated
debt securities is distributed in exchange for the trust securities of a trust,
we will make payments on such subordinated debt securities in accordance with
procedures similar to those described under "Description of the Trust Preferred
Securities--Payment and Paying Agency" above.
Any money paid to the subordinated indenture trustee or any paying agent, or
held in trust by us, for payments on any subordinated debt securities, that
remains unclaimed at the end of two years after the amount is due will be
repaid to us. After that two-year period, a holder of subordinated debt
securities may look only to us for payment of those amounts.
Business Day
If any payment is due on a day that is not a Business Day, the payment will
be made on the following Business Day unless that Business Day is in a
different calendar year, in which case the payment will be made on the
preceding Business Day. Each payment made on the following or preceding
Business Day will have the same force and effect as if made on the original
payment due date.
Record Date
If subordinated debt securities are held in book-entry form, the record date
will be one Business Day before the relevant interest payment date. If
subordinated debt securities are held in certificated form, the record date
will be as provided in a prospectus supplement.
Deferral Periods
With respect to any series of subordinated debt securities, as long as no
Subordinated Indenture Event of Default with respect to such series has
occurred and has not been cured, we will have the right to defer the
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payment of interest on such series of subordinated debt securities as described
in "Description of the Trust Preferred Securities--Distributions" above. During
a deferral period, the holders of such series of subordinated debt securities
will continue to accrue interest at the stated annual rate of interest for such
series, plus will accrue additional interest on each deferred interest payment
at such stated annual rate, compounded quarterly, from the corresponding
interest payment date, to the extent permitted by law. Whenever we use the term
"interest" with respect to subordinated debt securities in this prospectus, we
are including any of this additional interest.
Deferral Period Restrictions
During a deferral period, we and our subsidiaries may not take any of the
following actions, except as described below:
. declare or pay any dividend or other distribution on, redeem, purchase or
acquire, or make a liquidation payment on any shares of our capital
stock;
. pay any amount on or repay, redeem or repurchase any debt securities
issued by us that rank equally with or junior to the subordinated debt
securities; or
. make any payments under any of our guarantees if such guarantee ranks
equally with or junior to the subordinated debt securities and guarantees
payments on any debt security of any of our subsidiaries.
Notwithstanding the foregoing, we may take any of the following actions
during a deferral period:
. declare dividends in, or make any payment in, shares of our common stock;
. redeem, purchase or acquire our common stock if related to the issuance
of common stock under any of our benefit plans for our directors,
officers or employees;
. declare or pay a dividend in connection with any shareholder's rights
plan, issue stock under such plan or redeem, repurchase or acquire any
rights distributed pursuant to the plan; or
. make payments under any trust preferred securities guarantee (as
described under "Description of the Trust Preferred Securities--Status of
Trust Preferred Securities Guarantees" above and under "Description of
Trust Preferred Securities Guarantees" below).
Deferral Period Procedures
We will give the property trustee and regular trustees of a trust and the
subordinated indenture trustee notice of our election to begin a deferral
period with respect to a series of subordinated debt securities held by such
trust at least one Business Day before the earlier of:
. the next distribution date for the trust preferred securities of such
trust; or
. the date the regular trustees of such trust are required to give notice
of the record date or the distribution date to (1) the New York Stock
Exchange or other applicable self-regulatory organization or (2) the
holders of the trust preferred securities of such trust.
The subordinated indenture trustee must notify the holders of a series of
subordinated debt securities in the manner described below in "--Notices" of
our election to begin a deferral period with respect to such series.
Stated Maturity
Each series of subordinated debt securities will have a stated maturity.
However, we may shorten such stated maturity to an earlier date stated in the
applicable prospectus supplement. You should expect that we will exercise this
option with respect to a series of subordinated debt securities if, for
example, a tax development occurs that prohibits us from deducting interest
payments on such series unless such series has a shorter maturity date.
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We also will have the option to extend the stated maturity of any series of
subordinated debt securities if:
. we are not in bankruptcy, insolvent or in liquidation;
. we are not in default on the payment of interest or principal on such
series of subordinated debt securities;
. the trust which holds such series of subordinated debt securities is not
in arrears on payments of distributions on its trust preferred
securities;
. no deferred distributions are accumulated on the trust preferred
securities of the trust which holds such series of subordinated debt
securities; and
. the trust preferred securities of the trust which holds such series of
subordinated debt securities are rated at least BBB- by Standard & Poor's
Ratings Services or Baa3 by Moody's Investors Services, Inc., or an
equivalent rating by a successor rating agency.
You should assume that we will exercise our option to extend the stated
maturity of a series of subordinated debt securities if we are unable to
refinance such subordinated debt securities at a lower interest rate or it is
otherwise in our interest to defer the stated maturity of such subordinated
debt securities.
Procedures
We will pay principal of and any premium on subordinated debt securities at
stated maturity, upon redemption or otherwise, upon presentation of
subordinated debt securities at the office of the subordinated indenture
trustee, as our paying agent. In our discretion, we may appoint one or more
additional paying agents and security registrars and designate one or more
additional places for payment and for registration of transfer, but we must at
all times maintain a place of payment of the subordinated debt securities and a
place for registration of transfer of the subordinated debt securities in the
Borough of Manhattan, The City of New York.
We will give notice to the subordinated indenture trustee of our selection
of a new stated maturity for any series of subordinated debt securities at
least 30 days, but not more than 60 days, prior to the effective date of the
change. The subordinated indenture trustee will give holders of such
subordinated debt securities notice of the new stated maturity promptly upon
its receipt of the notice from us. The subordinated indenture trustee will give
the notice in the manner described below under "--Notices."
Optional Redemption
We may redeem any series of subordinated debt securities, at our option,
before their stated maturity as follows:
. at any time on or after the date stated in an applicable prospectus
supplement, in whole or in part, provided that no partial redemption may
occur during a deferral period with respect to such series of
subordinated debt securities; and
. at any time in whole, but not in part, within 90 days after a Tax Event
or an Investment Company Act Event has occurred with respect to such
series of subordinated debt securities.
We will pay the Redemption Price on the Redemption Date to the holders of
subordinated debt securities to be redeemed. In this context, "Redemption
Price" means the aggregate principal amount of the subordinated debt securities
to be redeemed, plus any accrued and unpaid interest on those securities to the
Redemption Date. Notwithstanding the foregoing, installments of interest on
those securities that are due and payable on interest payment dates falling on
or prior to a Redemption Date will be payable on the interest payment date to
the registered holders as of the close of business on the relevant record date
according to those securities and the subordinated indenture. The Redemption
Price will be calculated on the basis of a 360-day year consisting of twelve
30-day months.
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We will mail notice of any redemption at least 30 days but not more than 60
days before the Redemption Date to each registered holder of the series of the
subordinated debt securities to be redeemed. Once notice of redemption is
mailed, the series of subordinated debt securities called for redemption will
become due and payable on the Redemption Date and at the applicable Redemption
Price, plus accrued and unpaid interest to the Redemption Date. If we elect to
redeem all or a portion of a series of subordinated debt securities, that
redemption will not be conditional upon receipt by the paying agent or the
subordinated indenture trustee of monies sufficient to pay the Redemption
Price. See "Description of Debt Securities--Optional Redemption" above.
Tax Event
"Tax Event" with respect to any trust means that we receive an opinion of
counsel, experienced in such matters, that as a result of any Tax Change (as
defined below), there is more than an insubstantial risk that:
. such trust is, or will be within 90 days after the date of the opinion of
counsel, subject to United States federal income tax with respect to
income received or accrued on the series of subordinated debt securities
held by such trust;
. interest payable by us or original issue discount accruing on such
subordinated debt securities is not, or within 90 days after the date of
the opinion, will not be, deductible by us, in whole or in part, for
United States federal income tax purposes; or
. such trust is, or will be within 90 days after the date of the opinion,
subject to more than a minimal amount of other taxes, duties or
governmental charges.
As used above, "Tax Change" means with respect to any trust any of the
following that are enacted, promulgated or announced on or after the date of
the prospectus supplement for the trust preferred securities of such trust:
. amendment to or change, including any announced prospective change, in
the laws or any regulations under the laws of the United States or of any
political subdivision or taxing authority of the United States; or
. official administrative pronouncement or judicial decision interpreting
or applying the laws or regulations stated above whether or not the
pronouncement or decision is issued to or in connection with a proceeding
involving us or such trust or subject to review or appeal.
Investment Company Act Event
"Investment Company Act Event" means with respect to any trust that we
receive an opinion of counsel, experienced in such matters, that as a result of
the occurrence of a change in law or regulation, or a written change in
interpretation or application of law or regulation, by any legislative body,
court, governmental agency or regulatory authority effective on or after the
date of the prospectus supplement for the trust preferred securities of such
trust, there is more than an insubstantial risk that such trust is or will be
considered an "investment company" that is required to be registered under the
Investment Company Act of 1940, as amended.
Payment of Additional Sums
If a Tax Event with respect to any trust is continuing and we do not elect
to redeem the series of subordinated debt securities held by such trust or
liquidate such trust, we will pay additional amounts, if any, to
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the holders of such subordinated debt securities so that, notwithstanding any
additional taxes, duties or charges imposed on such trust because of a Tax
Event, the trust will have sufficient funds to pay the full amount of
distributions due on the outstanding trust securities of such trust.
Redemption Procedures
We will give the holders of the series of subordinated debt securities to be
redeemed at least 30 days, but not more than 60 days, notice before the
Redemption Date, in the manner described below under "--Notices." Once notice
of redemption is mailed, the series of subordinated debt securities called for
redemption become due and payable on the Redemption Date and at the redemption
price, including accrued and unpaid interest and premium, if any, to the
Redemption Date. In all other respects, the procedures for redeeming
subordinated debt securities will be similar to those for redeeming trust
preferred securities. See "Description of the Trust Preferred Securities--
Redemption--Redemption Procedures" above.
On the Redemption Date, interest will stop accruing on the series of
subordinated debt securities called for redemption. However, if payment of the
Redemption Price for any such subordinated debt securities is not made,
interest on those subordinated debt securities will continue to accrue to the
date the Redemption Price is paid.
Exchange of Trust Preferred Securities for Subordinated Debt Securities
We will have the right at any time to dissolve a trust. In such event, the
applicable property trustee will distribute the series of subordinated debt
securities held by such trust to the holders of the trust preferred securities
of such trust in exchange for their securities. See "Description of Trust
Preferred Securities-- Exchange of Trust Preferred Securities for Subordinated
Debt Securities" above and procedures relating to such an exchange.
Restrictions on Payments
If any subordinated debt securities of a series are outstanding, we will be
prohibited from taking specified actions described below if:
(a) an event has occurred that constitutes a Subordinated Indenture
Event of Default for such series or, after notice or passage of time, or
both, would constitute a Subordinated Indenture Event of Default for such
series, and we have knowledge of such event but do not take reasonable
steps to cure the default;
(b) we do not pay any amount due under the trust preferred securities
guarantee relating to the trust preferred securities of such trust, if such
series of subordinated debt securities are held by such trust; or
(c) we have given notice of our election to begin a deferral period with
respect to such series and have not rescinded such notice, or any deferral
period with respect to such series is continuing.
In such event, we may not take any of the following actions, except as
described below:
(a) declare or pay any dividend or other distribution on, redeem,
purchase or acquire, or make a liquidation payment on any shares of our
capital stock;
(b) pay any amount on or repay, redeem or repurchase any debt securities
issued by us that rank equal with or junior to such series of subordinated
debt securities; or
(c) make any payments under any of our guarantees if such guarantee
ranks equal with or junior to such series of subordinated debt securities
and guarantees payments on any debt securities of any of our subsidiaries.
Notwithstanding the foregoing, we may:
(a) declare dividends in, or make any payment in, shares of our common
stock;
46
(b) redeem, purchase or acquire our common stock if related to the
issuance of common stock under any of our benefit plans for our directors,
officers or employees;
(c) declare or pay a dividend in connection with any shareholder's
rights plan, issue stock under such plan or redeem, repurchase or acquire
any rights distributed pursuant to the plan; or
(d) make payments under any trust preferred securities guarantee or any
other preferred securities guarantee (as described under "Description of
Trust Preferred Securities--Status of the Trust Preferred Securities
Guarantees" above and "Description of Trust Preferred Securities
Guarantees" below).
Events of Default
A "Subordinated Indenture Event of Default" occurs with respect to a series
of subordinated debt securities if:
(a) we do not pay any interest on any subordinated debt securities of
such series within 30 days of the due date, provided that, if we elect to
defer an interest payment, the date on which that payment is due will be
the date on which we are required to make payment following its deferral;
(b) we do not pay any principal of or premium on any subordinated debt
securities of such series on the due date;
(c) we remain in breach of a covenant or warranty (excluding covenants
and warranties solely applicable to another series of subordinated debt
securities issued under the subordinated indenture) in the subordinated
indenture or the subordinated debt securities of such series for 60 days
after we receive a written notice of default stating we are in breach and
requiring remedy of the breach; the notice must be sent by either the
subordinated indenture trustee or registered holders of at least 25% of the
principal amount of the outstanding subordinated debt securities of such
series; or
(d) we file for bankruptcy or other specified events in bankruptcy,
insolvency, receivership or reorganization occur.
Remedies
Acceleration
If a Subordinated Indenture Event of Default occurs and is continuing with
respect to the subordinated debt securities of a series, then either the
subordinated indenture trustee or the registered holders of at least 25% in
principal amount of the outstanding subordinated debt securities of such series
may declare the principal amount of all such subordinated debt securities,
together with accrued and unpaid interest thereon, to be due and payable
immediately.
Rescission of Acceleration
After the declaration of acceleration has been made with respect to a series
of subordinated debt securities and before the subordinated indenture trustee
has obtained a judgment or decree for payment of the money due, the declaration
and its consequences will be rescinded and annulled, if:
(a) we pay or deposit with the subordinated indenture trustee a sum
sufficient to pay:
(1) all overdue interest on the subordinated debt securities of such
series, other than interest which has become due by declaration of
acceleration;
(2) the principal of and any premium on the subordinated debt
securities of such series which have become due otherwise than by the
declaration of acceleration and overdue interest on these amounts;
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(3) interest on overdue interest, other than interest, which has become
due by declaration of acceleration, on the subordinated debt securities of
such series to the extent lawful;
(4) all amounts due to the subordinated indenture trustee under the
subordinated indenture; and
(b) all Subordinated Indenture Events of Default with respect to the
subordinated debt securities of such series, other than the nonpayment of
the principal and interest which has become due solely by the declaration
of acceleration, have been cured or waived as provided in the subordinated
indenture.
For more information as to waiver of defaults, see "--Waiver of Default and
of Compliance" below.
Control by Registered Holders; Limitations
If a Subordinated Indenture Event of Default with respect to a series of
subordinated debt securities occurs and is continuing, the registered holders
of a majority in principal amount of the outstanding subordinated debt
securities of such series, voting as a single class, without regard to the
holders of outstanding subordinated debt securities of any other series that
may also be in default, will have the right to direct the time, method and
place of:
(a) conducting any proceeding for any remedy available to the
subordinated indenture trustee with respect to the subordinated debt
securities of such series; and
(b) exercising any trust or power conferred on the subordinated
indenture trustee with respect to the subordinated debt securities of such
series.
These rights of registered holders to give directions are subject to the
following limitations:
(a) the registered holders' directions do not conflict with any law or
the subordinated indenture; and
(b) the direction is not unduly prejudicial to the rights of holders of
subordinated debt securities of such series who do not join in that action.
The subordinated indenture trustee may also take any other action it deems
proper which is consistent with the registered holders' direction.
In addition, the subordinated indenture provides that no registered holder
of subordinated debt securities of any series will have any right to institute
any proceeding, judicial or otherwise, with respect to the subordinated
indenture or for the appointment of a receiver or for any other remedy
thereunder unless:
(a) that registered holder has previously given the subordinated
indenture trustee written notice of a continuing Subordinated Indenture
Event of Default with respect to such series;
(b) the registered holders of at least 25% in aggregate principal amount
of the outstanding subordinated debt securities of such series have made
written request to the subordinated indenture trustee to institute
proceedings in respect of that Subordinated Indenture Event of Default and
have offered the subordinated indenture trustee reasonable indemnity
against costs and liabilities incurred in complying with the request; and
(c) for 60 days after receipt of the notice, the subordinated indenture
trustee has failed to institute a proceeding and no direction inconsistent
with the request has been given to the subordinated indenture trustee
during the 60-day period by the registered holders of a majority in
aggregate principal amount of outstanding subordinated debt securities of
such series.
Furthermore, no registered holder will be entitled to institute any action if
and to the extent that the action would disturb or prejudice the rights of
other registered holders of subordinated debt securities.
However, each registered holder has an absolute and unconditional right to
receive payment when due and to bring a suit to enforce that right.
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Notice of Default
The subordinated indenture trustee is required to give the registered
holders of subordinated debt securities notice of any default under the
subordinated indenture to the extent required by the Trust Indenture Act,
unless the default has been cured or waived; except that in the case of an
event of default of the character specified above in clause (c) under "--Events
of Default," no notice shall be given to the registered holders until at least
30 days after the occurrence of the default. The Trust Indenture Act currently
permits the subordinated indenture trustee to withhold notices of default
(except for certain payment defaults) if the subordinated indenture trustee in
good faith determines the withholding of the notice to be in the interests of
the registered holders.
We will furnish the subordinated indenture trustee with an annual statement
as to our compliance with the conditions and covenants in the subordinated
indenture.
Waiver of Default and of Compliance
The registered holders of a majority in aggregate principal amount of the
outstanding subordinated debt securities of any series, voting as a single
class, without regard to the holders of outstanding subordinated debt
securities of any other series, may waive, on behalf of all registered holders
of the subordinated debt securities of such series, any past default under the
subordinated indenture, except a default in the payment of principal, premium
or interest on any subordinated debt securities of such series, or with respect
to compliance with certain provisions of the subordinated indenture that cannot
be amended without the consent of the registered holder of each outstanding
trust preferred security of the trust which holds such series of subordinated
debt securities.
Unless indicated differently in a prospectus supplement, compliance with
certain covenants in the applicable indenture or otherwise provided with
respect to subordinated debt securities of any series may be waived prior to
the time specified for compliance by the registered holders of a majority in
aggregate principal amount of the subordinate debt securities of such series.
Consolidation, Merger and Conveyance of Assets as an Entirety; No Financial
Covenants
We have agreed not to consolidate or merge with or into any other entity, or
to sell, transfer, lease or otherwise convey our properties and assets as an
entirety or substantially as an entirety to any entity, unless:
(a) either we are the continuing entity (in the case of a merger) or the
successor entity formed by such consolidation or into which we are merged
or which acquires by sale, transfer, lease or other conveyance our
properties and assets, as an entirety or substantially as an entirety, is a
corporation is an entity organized and existing under the laws of the
United States of America or any State thereof or the District of Columbia,
and expressly assumes, by supplemental indenture, the due and punctual
payment of the principal, premium and interest on all the subordinated debt
securities and the performance of all of our covenants under the
subordinated indenture; and
(b) immediately after giving effect to the transaction, no Subordinated
Indenture Event of Default, and no event which after notice or lapse of
time or both would become a Subordinated Indenture Event of Default, has or
will have occurred and be continuing.
In addition to these conditions, the successor entity must assume all of our
obligations with respect to the trust preferred securities guarantees, and such
transaction must be permitted under, and not give rise to any violation of, any
Declaration or any trust preferred securities guarantee.
Neither the subordinated indenture nor the trust preferred securities
guarantees contain any financial or other similar restrictive covenants.
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Modification of Subordinated Indenture
Without Registered Holder Consent. Without the consent of any registered
holders of any subordinated debt securities which may in the future be issued
under the subordinated indenture, we, and the subordinated indenture trustee,
may enter into one or more supplemental indentures for any of the following
purposes:
(a) to evidence the succession of another entity to us; or
(b) to add one or more covenants for the benefit of the holders of all
or any series of subordinated debt securities, or to surrender any right or
power conferred upon us; or
(c) to add any additional events of default for all or any series of
subordinated debt securities; or
(d) to change or eliminate any provision of the subordinated indenture
so long as the change or elimination does not apply to any subordinated
debt securities entitled to the benefit of such provision or to add any new
provision to the subordinated indenture (in addition to the provisions
which may otherwise be added to the subordinated indenture pursuant to the
other clauses of this paragraph) so long as the addition does not apply to
any outstanding subordinated debt securities; or
(e) to provide security for the subordinated debt securities of any
series; or
(f) to establish the form or terms of subordinated debt securities of
any series as permitted by the subordinated indenture; or
(g) to evidence and provide for the acceptance of appointment of a
separate or successor subordinated indenture trustee; or
(h) to cure any ambiguity, defect or inconsistency or to make any other
changes with respect to any series of subordinated debt securities that do
not adversely affect the interests of the holders of that series of
subordinated debt securities in any material respect.
With Registered Holder Consent. Subject to the following sentence, we and
the subordinated indenture trustee may, with some exceptions, amend or modify
the subordinated indenture with the consent of the registered holders of at
least a majority in aggregate principal amount of the subordinated debt
securities of each series affected by the amendment or modification. However,
no amendment or modification may, without the consent of the registered holder
of each outstanding subordinated debt security affected thereby:
(a) change the stated maturity of the principal or interest on any
subordinated debt security or reduce the principal amount, interest or
premium payable, or change any place of payment where or the currency in
which any debt security is payable, or impair the right to bring suit to
enforce any payment;
(b) reduce the percentages of registered holders whose consent is
required for any supplemental indenture or waiver;
(c) modify certain of the provisions in the subordinated indenture
relating to supplemental indentures and waivers of certain covenants and
past defaults; or
(d) modify any provisions relating to subordination or the definition of
"senior debt" in a manner adverse to the holders of the subordinated debt
securities.
A supplemental indenture which changes or eliminates any provision of a
subordinated indenture expressly included solely for the benefit of holders of
subordinated debt securities of one or more particular series will be deemed
not to affect the interests under the subordinated indenture of the holders of
subordinated debt securities of any other series. However, any amendment that
adversely affects the holders of any series of trust preferred securities in
any material respect, as well as any termination of the subordinated indenture
and any waiver of a Subordinated Indenture Event of Default with respect to any
series of subordinated debt securities, will require the consent of the holders
of a majority in liquidation amount of each series of trust preferred
securities affected thereby.
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Subordination
The subordinated debt securities will be subordinated in right of payment to
the prior payment in full of all our senior debt. This means that, upon:
(a) any distribution of our assets upon our dissolution, winding-up,
liquidation or reorganization in bankruptcy, insolvency, receivership or
other proceedings; or
(b) acceleration of the maturity of any subordinated debt securities; or
(c) a failure to pay any senior debt or interest thereon when due and
continuance of that default beyond any applicable grace period; or
(d) acceleration of the maturity of any senior debt as a result of a
default, the holders of all of our senior debt will be entitled to receive:
(1) in the case of clauses (a) and (b) above, payment of all amounts due
or to become due on all senior debt; and
(2) in the case of clauses (c) and (d) above, payment of all amounts due
on all senior debt,
before the holders of any of the subordinated debt securities are entitled to
receive any payment. So long as any of the events in clauses (a), (b), (c) or
(d) above has occurred and is continuing, any amounts payable on the
subordinated debt securities will instead be paid directly to the holders of
all senior debt to the extent necessary to pay the senior debt in full and, if
any payment is received by the subordinated indenture trustee under the
subordinated indenture or the holders of any of the subordinated debt
securities before all senior debt is paid in full, the payment or distribution
must be paid over to the holders of the unpaid senior debt. Subject to paying
the senior debt in full, the holders of the subordinated debt securities will
be subrogated to the rights of the holders of the senior debt to the extent
that payments are made to the holders of senior debt out of the distributive
share of the subordinated debt securities.
"senior debt" means with respect to the subordinated debt securities, the
principal of, and premium, if any, and interest on any other payment in respect
of indebtedness due pursuant to any of the following, whether outstanding on
the date the subordinated debt securities are issued or thereafter incurred,
created or assumed:
(a) all of our indebtedness evidenced by notes, debentures, bonds or
other securities sold by us for money or other obligations for money
borrowed;
(b) all indebtedness of others of the kinds described in the preceding
clause (a) assumed by or guaranteed in any manner by us or in effect
guaranteed by us through an agreement to purchase, contingent or otherwise;
and
(c) all renewals, extensions or refundings of indebtedness of the kinds
described in either of the preceding clauses (a) and (b), unless, in the
case of any particular indebtedness, renewal, extension or refunding, the
instrument creating or evidencing the same or the assumption or guarantee
of the same by its terms provides that such indebtedness, renewal,
extension or refunding is not superior in right of payment to or is pari
passu with such securities.
Due to the subordination, if our assets are distributed upon insolvency,
certain of our general creditors may recover more, ratably, than holders of
subordinated debt securities. The subordination provisions will not apply to
money and securities held in trust under the satisfaction and discharge and the
defeasance provisions of the subordinated indenture.
The subordinated debt securities, the subordinated indenture and the trust
preferred securities guarantees do not limit our or any of our subsidiaries'
ability to incur additional indebtedness, including indebtedness that ranks
senior to the subordinated debt securities and the trust preferred securities
guarantees. We expect that we and our subsidiaries will incur substantial
additional amounts of indebtedness in the future.
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Defeasance
The subordinated indenture provides, unless the terms of the particular
series of debt securities provide otherwise, that we may, upon satisfying
several conditions, cause ourselves to be discharged from our obligations, with
some exceptions, with respect to any series of subordinated debt securities,
which we refer to as "defeasance."
One condition we must satisfy is the irrevocable deposit with the
subordinated trustee, in trust, of money and/or government obligations which,
through the scheduled payment of principal and interest on those obligations,
would provide sufficient moneys to pay the principal of and any premium and
interest on those subordinated debt securities on the maturity dates of the
payments or upon redemption.
In addition, we will be required to deliver an opinion of counsel to the
effect that a holder of subordinated debt securities will not recognize income,
gain or loss for federal income tax purposes as a result of the defeasance and
will be subject to federal income tax on the same amounts, at the same times
and in the same manner as if that defeasance had not occurred. The opinion of
counsel must be based upon a ruling of the Internal Revenue Service or a change
in law after the date of the subordinated indenture.
Satisfaction and Discharge
The subordinated indenture will cease to be of further effect with respect
to any series of subordinated debt securities, and we will be deemed to have
satisfied and discharged all of our obligations under the subordinated
indenture, except as noted below, when:
(a) all outstanding subordinated debt securities of such series have
become due or will become due within one year at their stated maturity or
on a Redemption Date; and
(b) we deposit with the subordinated indenture trustee, in trust, funds
that are sufficient to pay and discharge all remaining indebtedness on the
outstanding subordinated debt securities of such series.
We will remain obligated to pay all other amounts due under the subordinated
indenture and to perform certain ministerial tasks as described in the
subordinated indenture.
Resignation and Removal of the Trustee; Deemed Resignation
The subordinated indenture trustee with respect to any series of
subordinated debt securities may resign at any time by giving written notice to
us. The subordinated indenture trustee may also be removed with respect to the
subordinated debt securities of any series by act of the registered holders of
a majority in principal amount of the then outstanding subordinated debt
securities of such series. No resignation or removal of the subordinated
indenture trustee and no appointment of a successor trustee will become
effective until the acceptance of appointment by a successor trustee in
accordance with the requirements of the subordinated indenture. Under certain
circumstances, we may appoint a successor trustee with respect to any series of
subordinated debt securities and if the successor trustee accepts, the
subordinated indenture trustee will be deemed to have resigned.
Registration of Trust Preferred Subordinated Debt Securities
The trust preferred subordinated debt securities initially will be issued in
certificated form and registered in the name of the applicable property
trustee. If in the future any trust preferred subordinated debt securities are
distributed to holders of trust preferred securities in exchange for trust
preferred securities and at that time such trust preferred securities are
represented by a global security, the subordinated debt securities would also
be represented by a global security. In this event, we expect that the book-
entry arrangements applicable to such subordinated debt securities would be
similar to those applicable to the trust preferred securities.
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Notices
Notices to be given to holders of subordinated debt securities held in
certificated form may be given by mail to their addresses as set forth in our
records. Notices to be given to holders of subordinated debt securities held in
book-entry form will be given to DTC in accordance with its procedures.
Governing Law
The subordinated indenture and the subordinated debt securities will be
governed by and construed in accordance with the laws of the State of New York.
53
DESCRIPTION OF TRUST PREFERRED SECURITIES GUARANTEES
General
We will execute a trust preferred securities guarantee ("preferred
securities guarantee"), which benefits the holders of trust preferred
securities, at the time that a trust issues those trust preferred securities.
Each preferred securities guarantee will be qualified as an indenture under
the Trust Indenture Act. The Bank of New York will act as indenture trustee
("guarantee trustee") under each preferred securities guarantee for the
purposes of compliance with the Trust Indenture Act.
The guarantee trustee will hold each preferred securities guarantee for the
benefit of the trust preferred securities holders of the applicable trust.
We will irrevocably agree, as described in each preferred securities
guarantee, to pay in full, to the holders of the trust preferred securities
issued by the applicable trust, the preferred securities guarantee payments
(as defined below) (except to the extent previously paid), when and as due,
regardless of any defense, right of set-off or counterclaim which the trust
may have or assert. The following payments, to the extent not paid by a trust
("guarantee payments"), will be covered by the applicable preferred securities
guarantee:
(a) any accrued and unpaid distributions required to be paid on the
applicable trust preferred securities, to the extent that the trust has
funds available to make the payment;
(b) the redemption price, to the extent that the trust has funds
available to make the payment; and
(c) upon a voluntary or involuntary dissolution and liquidation of the
trust (other than in connection with a distribution of subordinated debt
securities to holders of the trust preferred securities or the redemption
of all the trust preferred securities), the lesser of:
(1) the aggregate of the liquidation amount specified in the
prospectus supplement for each trust preferred security plus all accrued
and unpaid distributions on the trust preferred security to the date of
payment, to the extent the trust has funds available to make the
payment; and
(2) the amount of assets of the trust remaining available for
distribution to holders of its trust preferred securities upon a
dissolution and liquidation of the trust.
Our obligation to make a guarantee payment may be satisfied by directly
paying the required amounts to the holders of the trust preferred securities
or by causing the trust to pay the amounts to the holders.
No single document executed by us relating to the issuance of trust
preferred securities will provide for its full, irrevocable and unconditional
guarantee of the trust preferred securities. It is only the combined operation
of our obligations under the subordinated indenture, the applicable series of
subordinated debt securities and the applicable preferred securities guarantee
and related Declaration that has the effect of providing a full, irrevocable
and unconditional guarantee of a trust's obligations under its trust preferred
securities.
Status of the Preferred Securities Guarantees
Each preferred securities guarantee will constitute our unsecured
obligation and will rank:
(a) subordinate and junior in right of payment to all of our other
liabilities, except any guarantee now or hereafter issued by us in respect
of any preferred or preference stock of any of our affiliates;
(b) equal with any guarantee now or hereafter issued by us in respect of
the most senior preferred or preference stock now or hereafter issued by
us, and with any guarantee now or hereafter issued by us in respect of any
preferred or preference stock of any of our affiliates; and
(c) senior to our common stock.
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Each Declaration will require that the holder of trust preferred securities
accept the subordination provisions and other terms of the preferred securities
guarantee. Each preferred securities guarantee will constitute a guarantee of
payment and not of collection. As a result, the holder of the guaranteed
security may sue us, or seek other remedies, to enforce its rights under the
preferred securities guarantee without first suing any other person or entity.
A preferred securities guarantee will not be discharged except by payment of
the preferred securities guarantee payments in full to the extent not
previously paid or upon distribution to the applicable trust preferred
securities holders of the corresponding series of subordinated debt securities
pursuant to the appropriate Declaration.
Amendments and Assignment
Except with respect to any changes which do not adversely affect the rights
of holders of a series of trust preferred securities in any material respect
(in which case no consent of the holders will be required), a preferred
securities guarantee may be amended only with the prior approval of the holders
of at least a majority in aggregate liquidation amount of the trust preferred
securities (excluding any trust preferred securities held by us or any of our
affiliates). A description of the way to obtain any approval is described under
"Description of Trust Preferred Securities--Voting Rights; Amendment of
Declaration." All guarantees and agreements contained in a preferred securities
guarantee will be binding on our successors, assigns, receivers, trustees and
representatives and are for the benefit of the holders of the applicable trust
preferred securities.
Preferred Securities Guarantee Events of Default
An event of default under a preferred securities guarantee occurs if we fail
to make any of our required payments or perform our obligations under the
preferred securities guarantee.
The holders of at least a majority in aggregate liquidation amount of the
trust preferred securities relating to each preferred securities guarantee,
excluding any trust preferred securities held by us or any of our affiliates,
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the guarantee trustee relating to the
preferred securities guarantee or to direct the exercise of any trust or power
given to the guarantee trustee under the preferred securities guarantee.
Information Concerning the Guarantee Trustees
The guarantee trustee under a preferred securities guarantee, other than
during the occurrence and continuance of a default under the preferred
securities guarantee, will perform only the duties that are specifically
described in the preferred securities guarantee. After such a default, the
guarantee trustee will exercise the same degree of care and skill as a prudent
person would exercise or use in the conduct of his or her own affairs. Subject
to this provision, a guarantee trustee is under no obligation to exercise any
of its powers as described in the applicable preferred securities guarantee at
the request of any holder of covered trust preferred securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
it might incur.
Termination of the Preferred Securities Guarantees
Each preferred securities guarantee will terminate once the applicable trust
preferred securities are paid in full or upon distribution of the corresponding
series of subordinated debt securities to the holders of the trust preferred
securities. Each preferred securities guarantee will continue to be effective
or will be reinstated if at any time any holder of trust preferred securities
issued by the applicable trust must restore payment of any sums paid under the
trust preferred securities or the preferred securities guarantee.
Governing Law
The preferred securities guarantees will be governed by and construed in
accordance with the laws of the State of New York.
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RELATIONSHIP AMONG TRUST PREFERRED SECURITIES, PREFERRED SECURITIES GUARANTEES
AND SUBORDINATED DEBT SECURITIES HELD BY EACH TRUST
Payments of distributions and redemption and liquidation payments due on
each series of trust preferred securities, to the extent the applicable trust
has funds available for the payments, will be guaranteed by us to the extent
described under "Description of Trust Preferred Securities Guarantees." No
single document executed by us in connection with the issuance of any series of
trust preferred securities will provide for our full, irrevocable and
unconditional guarantee of the trust preferred securities. It is only the
combined operation of our obligations under the applicable preferred securities
guarantee, Declaration, subordinated indenture and subordinated debt securities
that has the effect of providing a full, irrevocable and unconditional
guarantee of a trust's obligations under its trust preferred securities.
As long as we make payments of interest and other payments when due on the
subordinated debt securities held by a trust, the payments will be sufficient
to cover the payment of distributions and redemption and liquidation payments
due on the trust preferred securities issued by that trust, primarily because:
(a) the aggregate principal amount of the subordinated debt securities
will be equal to the sum of the aggregate liquidation amount of the trust
preferred and common securities;
(b) the interest rate and interest and other payment dates on the
subordinated debt securities will match the distribution rate and
distribution and other payment dates for the trust preferred securities;
(c) we shall pay for any and all costs, expenses and liabilities of each
trust except the trust's obligations under its trust preferred securities
(and we have agreed to guarantee such payment); and
(d) each Declaration provides that the related trust will not engage in
any activity that is not consistent with the limited purposes of such
trust.
If and to the extent that we do not make payments on the related
subordinated debt securities, a trust will not have funds available to make
payments of distributions or other amounts due on its trust preferred
securities. In those circumstances, holders of such trust preferred securities
will not be able to rely upon the preferred securities guarantee for payment of
these amounts. Instead, holders of such trust preferred securities may directly
sue us or seek other remedies to collect their pro rata share of payments owed.
If holders of such trust preferred securities sue us to collect payment, then
we will assume their rights as a holder of trust preferred securities under
such trust's Declaration to the extent we make a payment to them in any legal
action.
A holder of any trust preferred security may sue us, or seek other remedies,
to enforce its rights under the applicable preferred securities guarantee
without first suing the applicable guarantee trustee, the trust which issued
the trust preferred security or any other person or entity.
GLOBAL SECURITIES
Book-Entry, Delivery and Form
Unless the company issuing the debt securities, trust preferred securities,
warrants, common stock, preferred stock, stock purchase contracts, stock
purchase units or depositary shares (the "securities") indicates differently in
a supplemental prospectus, the securities initially will be issued in book-
entry form and represented by one or more global notes or global securities
(collectively, "global securities"). The global securities will be deposited
with, or on behalf of, The Depositary Trust Company, New York, New York, as
depositary ("DTC"), and registered in the name of Cede & Co., the nominee of
DTC. Unless and until it is exchanged for individual certificates evidencing
securities under the limited circumstances described below, a global security
may not be transferred except as a whole by the depositary to its nominee or by
the nominee to the depositary, or by the depositary or its nominee to a
successor depositary or to a nominee of the successor depositary.
56
DTC has advised each of the issuing companies that it is:
. a limited-purpose trust company organized under the New York Banking Law;
. a "banking organization" within the meaning of the New York Banking Law;
. a member of the Federal Reserve System;
. a "clearing corporation" within the meaning of the New York Uniform
Commercial Code; and
. a "clearing agency" registered pursuant to the provisions of Section 17A
of the Securities Exchange Act of 1934.
DTC holds securities that its participants deposit with DTC. DTC also
facilitates the settlement among its participants of securities transactions,
including transfers and pledges, in deposited securities through electronic
computerized book-entry changes in participants' accounts, which eliminates the
need for physical movement of securities certificates. "Direct participants" in
DTC include securities brokers and dealers, including underwriters, banks,
trust companies, clearing corporations and other organizations. DTC is owned by
a number of its direct participants and by the New York Stock Exchange, Inc.,
the American Stock Exchange LLC and the National Association of Securities
Dealers, Inc. Access to the DTC system is also available to others, which we
sometimes refer to as "indirect participants," that clear transactions through
or maintain a custodial relationship with a direct participant either directly
or indirectly. The rules applicable to DTC and its participants are on file
with the SEC.
Purchases of securities within the DTC system must be made by or through
direct participants, which will receive a credit for those securities on DTC's
records. The ownership interest of the actual purchaser of a security, which we
sometimes refer to as a "beneficial owner," is in turn recorded on the direct
and indirect participants' records. Beneficial owners of securities will not
receive written confirmation from DTC of their purchases. However, beneficial
owners are expected to receive written confirmations providing details of their
transactions, as well as periodic statements of their holdings, from the direct
or indirect participants through which they purchased securities. Transfers of
ownership interests in global securities are to be accomplished by entries made
on the books of participants acting on behalf of beneficial owners. Beneficial
owners will not receive certificates representing their ownership interests in
the global securities except under the limited circumstances described below.
To facilitate subsequent transfers, all global securities deposited with DTC
will be registered in the name of DTC's nominee, Cede & Co. The deposit of
securities with DTC and their registration in the name of Cede & Co. will not
change the beneficial ownership of the securities. DTC has no knowledge of the
actual beneficial owners of the securities. DTC's records reflect only the
identity of the direct participants to whose accounts the securities are
credited, which may or may not be the beneficial owners. The participants are
responsible for keeping account of their holdings on behalf of their customers.
So long as the securities are in book-entry form, you will receive payments
and may transfer securities only through the facilities of the depositary and
its direct and indirect participants. The company issuing the securities will
maintain an office or agency in the Borough of Manhattan, the City of New York
where notices and demands in respect of the securities and the applicable
indenture may be delivered to us and where certificated securities may be
surrendered for payment, registration of transfer or exchange. That office or
agency, with respect to the applicable indenture, will initially be the office
of the trustee which is currently located at 100 Wall Street, Suite 1600, New
York, New York 10005, in the case of U.S. Bank Trust National Association, and
101 Barclay Street, Floor 21, New York, New York 10286, in the case of The Bank
of New York.
Conveyance of notices and other communications by DTC to direct
participants, by direct participants to indirect participants and by direct
participants and indirect participants to beneficial owners will be governed by
arrangements among them, subject to any legal requirements in effect from time
to time.
57
Redemption notices will be sent to DTC or its nominee. If less than all of
the securities of a particular series are being redeemed, DTC will determine
the amount of the interest of each direct participant in the securities of such
series to be redeemed in accordance with DTC's procedures.
In any case where a vote may be required with respect to securities of a
particular series, neither DTC nor Cede & Co. will give consents for or vote
the global securities. Under its usual procedures, DTC will mail an omnibus
proxy to us as soon as possible after the record date. The omnibus proxy
assigns the consenting or voting rights of Cede & Co. to those direct
participants to whose accounts the securities of such series are credited on
the record date identified in a listing attached to the omnibus proxy.
So long as securities are in book-entry form, the company issuing such
securities will make payments on those securities to the depositary or its
nominee, as the registered owner of such securities, by wire transfer of
immediately available funds. If securities are issued in definitive
certificated form under the limited circumstances described below, the company
issuing the securities will have the option of paying interest by check mailed
to the addresses of the persons entitled to payment or by wire transfer to bank
accounts in the United States designated in writing to the applicable trustee
at least 15 days before the applicable payment date by the persons entitled to
payment.
Principal and interest payments on the securities will be made to Cede &
Co., as nominee of DTC. DTC's practice is to credit direct participants'
accounts on the relevant payment date unless DTC has reason to believe that it
will not receive payment on the payment date. Payments by direct and indirect
participants to beneficial owners will be governed by standing instructions and
customary practices, as is the case with securities held for the account of
customers in bearer form or registered in "street name." Those payments will be
the responsibility of participants and not of DTC or us, subject to any legal
requirements in effect from time to time. Payment of principal and interest to
Cede & Co. is our responsibility, disbursement of payments to direct
participants is the responsibility of DTC and disbursement of payments to the
beneficial owners is the responsibility of direct and indirect participants.
Except under the limited circumstances described below, purchasers of
securities will not be entitled to have securities registered in their names
and will not receive physical delivery of securities. Accordingly, each
beneficial owner must rely on the procedures of DTC and its participants to
exercise any rights under the securities and the applicable indenture.
The laws of some jurisdictions may require that some purchasers of
securities take physical delivery of securities in definitive form. Those laws
may impair the ability to transfer or pledge beneficial interests in
securities.
DTC is under no obligation to provide its services as depositary for the
securities and may discontinue providing its services at any time. Neither the
company issuing the securities nor the applicable trustee will have any
responsibility for the performance by DTC or its direct participants or
indirect participants under the rules and procedures governing DTC.
As noted above, beneficial owners of a particular series of securities
generally will not receive certificates representing their ownership interests
in those securities. However, if:
. DTC notifies the company issuing such securities that it is unwilling or
unable to continue as a depositary for the global security or securities
representing such series of securities or if DTC ceases to be a clearing
agency registered under the Securities Exchange Act at a time when it is
required to be registered and a successor depositary is not appointed
within 90 days of the notification to us or of our becoming aware of
DTC's ceasing to be so registered, as the case may be;
. the company issuing such securities determines, in its sole discretion,
not to have such securities represented by one or more global securities;
or
. an Event of Default under the indenture has occurred and is continuing
with respect to such series of securities,
58
the company issuing such securities will prepare and deliver certificates for
such securities in exchange for beneficial interests in the global securities.
Any beneficial interest in a global security that is exchangeable under the
circumstances described in the preceding sentence will be exchangeable for
securities in definitive certificated form registered in the names that the
depositary directs. It is expected that these directions will be based upon
directions received by the depositary from its participants with respect to
ownership of beneficial interests in the global securities.
Each company has obtained the information in this section and elsewhere in
this prospectus concerning DTC and DTC's book-entry system from sources that
are believed to be reliable, but neither company takes responsibility for the
accuracy of this information.
EXPERTS
The consolidated financial statements and the related financial statement
schedule incorporated by reference in this prospectus from Sempra Energy's
Annual Report on Form 10-K for the year ended December 31, 2000 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
reports, which are incorporated herein by reference and have been so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
VALIDITY OF THE SECURITIES AND THE GUARANTEES
Latham & Watkins, Los Angeles, California, will pass upon certain legal
matters relating to the issuance and sale of the securities and the guarantees
on behalf of Sempra Energy. Gary W. Kyle, Esq., Chief Corporate Counsel of
Sempra Energy, will pass upon the validity of the securities and the
guarantees. Richards, Layton & Finger, P.A., special Delaware counsel to Sempra
Energy and the trusts, will pass upon certain matters of Delaware law relating
to the validity of the preferred securities. Sidley Austin Brown & Wood LLP,
San Francisco, California, will pass upon the validity of the securities and
the guarantees for any underwriters or agents. Paul C. Pringle, a partner of
Sidley Austin Brown & Wood LLP, owns 2,162 shares of common stock of Sempra
Energy.
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PLAN OF DISTRIBUTION
We may sell the securities described in this prospectus from time to time in
one or more transactions
(a) to purchasers directly;
(b) to underwriters for public offering and sale by them;
(c) through agents;
(d) through dealers; or
(e) through a combination of any of the foregoing methods of sale.
We may distribute the securities from time to time in one or more
transactions at:
(a) a fixed price or prices, which may be changed;
(b) market prices prevailing at the time of sale;
(c) prices related to such prevailing market prices; or
(d) negotiated prices.
Direct Sales
We may sell the securities directly to institutional investors or others. A
prospectus supplement will describe the terms of any sale of securities we are
offering hereunder.
To Underwriters
The applicable prospectus supplement will name any underwriter involved in a
sale of securities. Underwriters may offer and sell securities at a fixed price
or prices, which may be changed, or from time to time at market prices or at
negotiated prices. Underwriters may be deemed to have received compensation
from us from sales of securities in the form of underwriting discounts or
commissions and may also receive commissions from purchasers of securities for
whom they may act as agent.
Underwriters may sell securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions (which may be changed from time to time)
from the purchasers for whom they may act as agent.
Unless otherwise provided in a prospectus supplement, the obligations of any
underwriters to purchase securities or any series of securities will be subject
to certain conditions precedent, and the underwriters will be obligated to
purchase all such securities if any are purchased.
Through Agents and Dealers
We will name any agent involved in a sale of securities, as well as any
commissions payable by us to such agent, in a prospectus supplement. Unless we
indicate differently in the prospectus supplement, any such agent will be
acting on a reasonable efforts basis for the period of its appointment.
If we utilize a dealer in the sale of the securities being offered pursuant
to this prospectus, we will sell the securities to the dealer, as principal.
The dealer may then resell the securities to the public at varying prices to be
determined by the dealer at the time of resale.
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Delayed Delivery Contracts
If we so specify in the applicable prospectus supplement, we will authorize
underwriters, dealers and agents to solicit offers by certain institutions to
purchase securities pursuant to contracts providing for payment and delivery on
future dates. Such contracts will be subject to only those conditions set forth
in the applicable prospectus supplement.
The underwriters, dealers and agents will not be responsible for the
validity or performance of the contracts. We will set forth in the prospectus
supplement relating to the contracts the price to be paid for the securities,
the commissions payable for solicitation of the contracts and the date in the
future for delivery of the securities.
General Information
Underwriters, dealers and agents participating in a sale of the securities
may be deemed to be underwriters as defined in the Securities Act, and any
discounts and commissions received by them and any profit realized by them on
resale of the securities may be deemed to be underwriting discounts and
commissions, under the Securities Act. We may have agreements with
underwriters, dealers and agents to indemnify them against certain civil
liabilities, including liabilities under the Securities Act, and to reimburse
them for certain expenses.
Underwriters or agents and their associates may be customers of, engage in
transactions with or perform services for us or our affiliates in the ordinary
course of business.
Unless we indicate differently in a prospectus supplement, we will not list
the securities on any securities exchange, other than shares of our common
stock. The securities, except for our common stock, will be a new issue of
securities with no established trading market. Any underwriters that purchase
securities for public offering and sale may make a market in such securities,
but such underwriters will not be obligated to do so and may discontinue any
market making at any time without notice. We make no assurance as to the
liquidity of or the trading markets for any securities.
61
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Securities and Exchange Commission registration fee.............. $ 500,000
Printing expenses................................................ 150,000
Trustee fees and expenses........................................ 75,000
Legal fees and expenses.......................................... 100,000
Accounting fees and expenses..................................... 250,000
Blue Sky fees and expenses....................................... 50,000
Rating Agency fees............................................... 250,000
Miscellaneous.................................................... 75,000
----------
Total.......................................................... $1,450,000
==========
--------
All of the above except the Securities and Exchange Commission registration fee
are estimated.
Item 15. Indemnification of Officers and Directors.
Section 317 of the Corporations Code of the State of California permits a
corporation to provide indemnification to its directors and officers under
certain circumstances. The Sempra Energy Amended and Restated Articles of
Incorporation and the Amended and Restated Bylaws eliminate the liability of
directors for monetary damages to the fullest extent permissible under
California law and provide that indemnification for liability for monetary
damages incurred by directors, officers and other agents of Sempra Energy shall
be allowed, subject to certain limitations, in excess of the indemnification
otherwise permissible under California law. In addition, Sempra Energy and
Sempra Energy Global Enterprises have indemnification agreements with each of
their officers and directors that provide for indemnification for monetary
damages to the fullest extent permissible under California law. Sempra Energy
and Sempra Energy Global Enterprises maintain liability insurance and are also
insured against loss for which they may be required or permitted by law to
indemnify their directors and officers for their related acts.
The directors and officers of Sempra Energy and Sempra Energy Global
Enterprises are covered by insurance policies indemnifying them against certain
liabilities, including certain liabilities arising under the Securities Act,
which might be incurred by them in such capacities and against which they
cannot be indemnified by Sempra Energy or Sempra Energy Global Enterprises.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the registrant
pursuant to the foregoing provisions, the registrant has been informed that in
the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
Item 16. Exhibits.
1.1 Underwriting Agreement (Preferred Securities--Sempra Energy Capital Trust
II and Sempra Energy Capital Trust III).*
1.2 Underwriting Agreement (Debt Securities--Sempra Energy).*
1.3 Underwriting Agreement (Debt Securities--Sempra Energy Global
Enterprises).*
1.4 Underwriting Agreement (Equity Securities--Sempra Energy).*
3.1 Amended and Restated Articles of Incorporation of Sempra Energy
(Incorporated by reference from the Registration Statement on Form S-3
File No. 333-51309 dated April 29, 1998 (Exhibit 3.1)).
II-1
3.2 Amended and Restated Bylaws of Sempra Energy effective May 26, 1998
(Incorporated by reference from the Registration Statement on Form S-8
File No. 333-56161 dated June 5, 1998 (Exhibit 3.2)).
3.3 Articles of Incorporation of Sempra Energy Global Enterprises
(Incorporated by reference from the Registration Statement on Form S-3
File No. 333-52192 dated January 8, 2001 (Exhibit 3.3)).
3.4 Bylaws of Sempra Energy Global Enterprises (Incorporated by reference
from the Registration Statement on Form S-3 File No. 333-52192 dated
January 8, 2001 (Exhibit 3.4)).
3.5 Certificate of Trust of Sempra Energy Capital Trust II (Incorporated by
reference from the Registration Statement on Form S-3 File No. 333-
52192 dated January 8, 2001 (Exhibit 3.5)).
3.6 Certificate of Trust of Sempra Energy Capital Trust III (Incorporated
by reference from the Registration Statement on Form S-3 File No. 333-
52192 dated January 8, 2001 (Exhibit 3.6)).
4.1 Indenture for Senior Debt Securities (Sempra Energy) (Incorporated by
reference from the Current Report on Form 8-K filed February 22, 2000
(Exhibit 4.1)).
4.2 Indenture for Subordinated Debt Securities (Sempra Energy)
(Incorporated by reference from the Current Report on Form 8-K filed
February 18, 2000 (Exhibit 4.1)).
4.3 Indenture for Senior Debt Securities (Sempra Energy Global Enterprises)
(Incorporated by reference from the Registration Statement on Form S-3
File No. 52912 dated January 8, 2001 (Exhibit 4.3)).
4.4 Form of Senior Note--Sempra Energy (included in Exhibit 4.1).
4.5 Form of Subordinated Note--Sempra Energy (included in Exhibit 4.2).
4.6 Form of Senior Note--Sempra Energy Global Enterprises (included in
Exhibit 4.3).
4.7 Form of Trust Preferred Security (included in Exhibit 4.12).
4.8 Form of Trust Preferred Security Guarantee--Sempra Energy Capital Trust
II.
4.9 Form of Trust Preferred Security Guarantee--Sempra Energy Capital Trust
III.
4.10 Declaration of Trust of Sempra Energy Capital Trust II.
4.11 Declaration of Trust of Sempra Energy Capital Trust III.
4.12 Form of Amended and Restated Declaration of Trust for each of Sempra
Energy Capital Trust II and Sempra Energy Capital Trust III.
4.13 Rights Agreement dated May 26, 1998 between Sempra Energy and First
Chicago Trust Company of New York, as rights agent (Incorporated by
reference from the Registration Statement on Form 8-A File No. 001-
14201 filed June 5, 1998 (Exhibit 1)).
4.14 Form of Warrant Agreement--Sempra Energy.*
4.15 Form of Warrant Certificate--Sempra Energy (included in Exhibit 4.14).*
4.15 Form of Deposit Agreement--Sempra Energy.*
4.16 Form of Depositary Receipt--Sempra Energy (included in Exhibit 4.15).*
4.17 Form of Purchase Contract.*
4.18 Form of Purchase Unit.*
5.1 Opinion of Gary W. Kyle, Esq.*
5.2 Opinion of Richards, Layton & Finger, P.A. relating to Sempra Energy
Capital Trust II.
5.3 Opinion of Richards, Layton & Finger, P.A. relating to Sempra Energy
Capital Trust III.
5.4 Opinion of Latham & Watkins.*
II-2
12.1 Statement regarding the computation of ratio of earnings to combined
fixed charges and preferred stock dividends for the years ended December
31, 2000, 1999, 1998, 1997 and 1996 and six-month periods ended June 30,
2000 and June 30, 2001.
23.1 Consent of Gary W. Kyle, Esq. (included in Exhibit 5.1).
23.2 Consent of Richards, Layton & Finger, P.A. (included in Exhibits 5.2 and
5.3).
23.3 Consent of Independent Auditors (Deloitte & Touche LLP).
23.4 Consent of Latham & Watkins (included in Exhibit 5.4).
24.1 Powers of Attorney (included on pages II-6, 8, 9 and 10).
25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of U.S. Bank Trust Company, as Trustee under the
Indenture (Senior Debt Securities--Sempra Energy).
25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Trustee under the
Indenture (Subordinated Debt Securities--Sempra Energy).
25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of U.S. Bank Trust Company, as Trustee under the
Indenture (Senior Debt Securities--Sempra Energy Global Enterprises).
25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property Trustee-- Sempra
Energy Capital Trust II.
25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property Trustee-- Sempra
Energy Capital Trust III.
25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred Securities
Guarantee Trustee-- Sempra Energy Capital Trust II.
25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred Securities
Guarantee Trustee-- Sempra Energy Capital Trust III.
25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Debt Securities Guarantee
Trustee-- Sempra Energy Global Enterprises.
--------
* To be filed by amendment or as an exhibit to a report filed under the
Securities Exchange Act of 1934, as amended and incorporated herein by
reference.
Item 17. Undertakings.
The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective dated of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Securities and Exchange Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more
than a 20% change in the
II-3
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that (i) and (ii) do not apply if the information required
to be included in a post-effective amendment by those paragraphs is contained
in periodic reports filed with or furnished to the Securities and Exchange
Commission by the registrants pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(4) That, for purposes of determining any liability under the Securities
Act, each filing of Sempra Energy's annual report pursuant to Section 13(a)
or Section 15(d) of the Exchange Act that is incorporated by reference in
this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(5) To file an application for the purpose of determining the
eligibility of the trustees to act under subsection (a) of Section 310 of
the Trust Indenture Act in accordance with the rules and regulations
prescribed by the Securities and Exchange Commission under Section
305(b)(2) of the Securities Act.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrants pursuant to the provisions described under Item 15 above, or
otherwise, the registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by a registrant of expenses incurred or paid by a director, officer
or controlling person in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, such registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Sempra Energy certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Diego, and State of California, on the 28th
day of September, 2001.
Sempra Energy
/s/ Stephen L. Baum
By: _________________________________
Stephen L. Baum
Chairman, Chief Executive Officer
and President
POWER OF ATTORNEY
Each director and/or officer of the registrant whose signature appears below
hereby appoints Stephen L. Baum, John R. Light and Neal E. Schmale, and each of
them severally, as his true and lawful attorney-in-fact and agent to sign in
his name and behalf, in any and all capacities stated below, and to file with
the Securities and Exchange Commission, any and all amendments, including post-
effective amendments and any registration statement for the same offering that
is to be effective under Rule 462(b) of the Securities Act, to this
registration statement, and the registrant hereby also appoints each such
person as its attorney-in-fact and agent with like authority to sign and file
any such amendments in its name and behalf.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed below by the following persons in the
capacities indicated on the 28th day of September, 2001.
Signature Title
--------- -----
/s/ Stephen L. Baum Principal Executive Officer;
______________________________________ Chairman, Chief Executive Officer,
Stephen L. Baum President and Director
/s/ Neal E. Schmale Principal Financial Officer;
______________________________________ Executive Vice President and Chief
Neal E. Schmale Financial Officer
/s/ Frank H. Ault Principal Accounting Officer;
______________________________________ Senior Vice President and
Frank H. Ault Controller
/s/ Hyla H. Bertea Director
______________________________________
Hyla H. Bertea
/s/ Herbert L. Carter Director
______________________________________
Herbert L. Carter
II-5
Signature Title
--------- -----
/s/ Richard A. Collato Director
______________________________________
Richard A. Collato
/s/ Daniel W. Derbes Director
______________________________________
Daniel W. Derbes
/s/ Wilford D. Godbold, Jr. Director
______________________________________
Wilford D. Godbold, Jr.
/s/ William D. Jones Director
______________________________________
William D. Jones
/s/ Ralph R. Ocampo Director
______________________________________
Ralph R. Ocampo
/s/ William G. Ouchi Director
______________________________________
William G. Ouchi
/s/ Thomas C. Stickel Director
______________________________________
Thomas C. Stickel
/s/ Diana L. Walker Director
______________________________________
Diana L. Walker
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Sempra Energy Global Enterprises certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Diego, and State of
California, on the 28th day of September, 2001.
Sempra Energy Global Enterprises
/s/ Donald E. Felsinger
By: _________________________________
Donald E. Felsinger
President
POWER OF ATTORNEY
Each director and/or officer of the registrant whose signature appears below
hereby appoints Stephen L. Baum, John R. Light and Neal E. Schmale, and each of
them severally, as his true and lawful attorney-in-fact and agent to sign in
his name and behalf, in any and all capacities stated below, and to file with
the Securities and Exchange Commission, any and all amendments, including post-
effective amendments and any registration statement for the same offering that
is to be effective under Rule 462(b) of the Securities Act, to this
registration statement, and the registrant hereby also appoints each such
person as its attorney-in-fact and agent with like authority to sign and file
any such amendments in its name and behalf.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed below by the following persons in the
capacities indicated on the 28th day of September, 2001.
Signature Title
--------- -----
/s/ Donald E. Felsinger President and Director
______________________________________
Donald E. Felsinger
/s/ John R. Light Director
______________________________________
John R. Light
/s/ Neal E. Schmale Director
______________________________________
Neal E. Schmale
/s/ Frank H. Ault Principal Accounting
______________________________________ Officer; Senior Vice
Frank H. Ault President and Controller
/s/ Charles A. McMonagle Principal Financial
______________________________________ Officer; Vice President
Charles A. McMonagle and Treasurer
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Sempra Energy Capital Trust II certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Diego, and State of
California, on the 28th day of September, 2001.
Sempra Energy Capital Trust II
/s/ Neal E. Schmale
By: _________________________________
Neal E. Schmale
POWER OF ATTORNEY
Each person whose signature appears below hereby appoints Stephen L. Baum,
John R. Light and Neal E. Schmale, and each of them severally, as his true and
lawful attorney-in-fact and agent to sign in his name and behalf, in any and
all capacities stated below, and to file with the Securities and Exchange
Commission, any and all amendments and any registration statement for the same
offering that is to be effective under Rule 462(b) of the Securities Act,
including post-effective amendments, to this registration statement, and the
registrant hereby also appoints each such person as its attorney-in-fact and
agent with like authority to sign and file any such amendments in its name and
behalf.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed below by the following persons in the
capacities indicated on the 28th day of September, 2001.
Signature Title
--------- -----
/s/ Neal E. Schmale Regular Trustee
______________________________________
Neal E. Schmale
/s/ Frank H. Ault Regular Trustee
______________________________________
Frank H. Ault
/s/ Charles A. McMonagle Regular Trustee
______________________________________
Charles A. McMonagle
II-8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Sempra Energy Capital Trust III certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Diego, and State of
California, on the 28th day of September, 2001.
Sempra Energy Capital Trust III
/s/ Neal E. Schmale
By: _________________________________
Neal E. Schmale
POWER OF ATTORNEY
Each person whose signature appears below hereby appoints Stephen L. Baum,
John R. Light and Neal E. Schmale, and each of them severally, as his true and
lawful attorney-in-fact and agent to sign in his name and behalf, in any and
all capacities stated below, and to file with the Securities and Exchange
Commission, any and all amendments and any registration statement for the same
offering that is to be effective under Rule 462(b) of the Securities Act,
including post-effective amendments, to this registration statement, and the
registrant hereby also appoints each such person as its attorney-in-fact and
agent with like authority to sign and file any such amendments in its name and
behalf.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed below by the following persons in the
capacities indicated on the 28th day of September, 2001.
Signature Title
--------- -----
/s/ Neal E. Schmale Regular Trustee
______________________________________
Neal E. Schmale
/s/ Frank H. Ault Regular Trustee
______________________________________
Frank H. Ault
/s/ Charles A. McMonagle Regular Trustee
______________________________________
Charles A. McMonagle
II-9
SEMPRA ENERGY
SEMPRA ENERGY GLOBAL ENTERPRISES
SEMPRA ENERGY CAPITAL TRUST II
SEMPRA ENERGY CAPITAL TRUST III
REGISTRATION STATEMENT ON FORM S-3
EXHIBIT INDEX
Exhibit
No. Description
------- -----------
1.1 Underwriting Agreement (Preferred Securities--Sempra Energy Capital
Trust II and Sempra Energy Capital Trust III).*
1.2 Underwriting Agreement (Debt Securities--Sempra Energy).*
1.3 Underwriting Agreement (Debt Securities--Sempra Energy Global
Enterprises).*
1.4 Underwriting Agreement (Equity Securities--Sempra Energy).*
3.1 Amended and Restated Articles of Incorporation of Sempra Energy
(Incorporated by reference from the Registration Statement on Form S-3
File No. 333-51309 dated April 29, 1998 (Exhibit 3.1)).
3.2 Amended and Restated Bylaws of Sempra Energy effective May 26, 1998
(Incorporated by reference from the Registration Statement on Form S-8
File No. 333-56161 dated June 5, 1998 (Exhibit 3.2)).
3.3 Articles of Incorporation of Sempra Energy Global Enterprises
(Incorporated by reference from the Registration Statement on Form S-3
File No. 333-52192 dated January 8, 2001 (Exhibit 3.3).
3.4 Bylaws of Sempra Energy Global Enterprises (Incorporated by reference
from the Registration Statement on Form S-3 File No. 333-52192 dated
January 8, 2001 (Exhibit 3.4).
3.5 Certificate of Trust of Sempra Energy Capital Trust II (Incorporated
by reference from the Registration Statement on Form S-3 File No. 333-
52192 dated January 8, 2001 (Exhibit 3.5).
3.6 Certificate of Trust of Sempra Energy Capital Trust III (Incorporated
by reference from the Registration Statement on Form S-3 File No. 333-
52192 dated January 8, 2001 (Exhibit 3.6).
4.1 Indenture for Senior Debt Securities (Sempra Energy) (Incorporated by
reference from the Current Report on Form 8-K filed February 22, 2000
(Exhibit 4.1)).
4.2 Indenture for Subordinated Debt Securities (Sempra Energy)
(Incorporated by reference from the Current Report on Form 8-K filed
February 18, 2000 (Exhibit 4.1)).
4.3 Indenture for Senior Debt Securities (Sempra Energy Global
Enterprises) (Incorporated by reference from the Registration
Statement on Form S-3 File No. 52912 dated January 8, 2001 (Exhibit
4.3)).
4.4 Form of Senior Note--Sempra Energy (included in Exhibit 4.1).
4.5 Form of Subordinated Note--Sempra Energy (included in Exhibit 4.2).
4.6 Form of Senior Note--Sempra Energy Global Enterprises (included in
Exhibit 4.3).
4.7 Form of Trust Preferred Security (included in Exhibit 4.12).
4.8 Form of Trust Preferred Security Guarantee--Sempra Energy Capital
Trust II.
4.9 Form of Trust Preferred Security Guarantee--Sempra Energy Capital
Trust III.
4.10 Declaration of Trust of Sempra Energy Capital Trust II.
Exhibit
No. Description
------- -----------
4.11 Declaration of Trust of Sempra Energy Capital Trust III.
4.12 Form of Amended and Restated Declaration of Trust for each of Sempra
Energy Capital Trust II and Sempra Energy Capital Trust III.
4.13 Rights Agreement dated May 26, 1998 between Sempra Energy and First
Chicago Trust Company of New York, as rights agent (Incorporated by
reference from the Registration Statement on Form 8-A File No. 001-
14201 filed June 5, 1998 (Exhibit 1)).
4.14 Form of Warrant Agreement--Sempra Energy.*
4.15 Form of Warrant Certificate--Sempra Energy (included in Exhibit
4.14).*
4.15 Form of Deposit Agreement--Sempra Energy.*
4.16 Form of Depositary Receipt--Sempra Energy (included in Exhibit 4.15).*
4.17 Form of Purchase Contract. *
4.18 Form of Purchase Unit.*
5.1 Opinion of Gary W. Kyle, Esq.*
5.2 Opinion of Richards, Layton & Finger, P.A. relating to Sempra Energy
Capital Trust II.
5.3 Opinion of Richards, Layton & Finger, P.A. relating to Sempra Energy
Capital Trust III.
5.4 Opinion of Latham & Watkins.*
12.1 Statement regarding the computation of ratio of earnings to combined
fixed charges and preferred stock dividends for the years ended
December 31, 2000, 1999, 1998, 1997 and 1996 and six-month periods
ended June 30, 2000 and June 30, 2001.
23.1 Consent of Gary W. Kyle, Esq. (included in Exhibit 5.1).
23.2 Consent of Richards, Layton & Finger, P.A. (included in Exhibits 5.2
and 5.3).
23.3 Consent of Independent Auditors (Deloitte & Touche LLP).
23.4 Consent of Latham & Watkins (included in Exhibit 5.4).
24.1 Powers of Attorney (included on pages II-6, 8, 9 and 10).
25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of U.S. Bank Trust Company, as Trustee under the
Indenture (Senior Debt Securities--Sempra Energy).
25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Trustee under the
Indenture (Subordinated Debt Securities--Sempra Energy).
25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of U.S. Bank Trust Company, as Trustee under the
Indenture (Senior Debt Securities--Sempra Energy Global Enterprises).
25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property Trustee--Sempra
Energy Capital Trust II.
25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Property Trustee--Sempra
Energy Capital Trust III.
25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred Securities
Guarantee Trustee--Sempra Energy Capital Trust II.
25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Preferred Securities
Guarantee Trustee--Sempra Energy Capital Trust III.
25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Bank of New York, as Debt Securities
Guarantee Trustee--Sempra Energy Global Enterprises.
--------
* To be filed by amendment or as an exhibit to a report filed under the
Securities Exchange Act of 1934, as amended and incorporated herein by
reference.
EXHIBIT 4.8
GUARANTEE AGREEMENT
BETWEEN
SEMPRA ENERGY
(as Guarantor)
AND
THE BANK OF NEW YORK
(as Trustee)
DATED AS OF_____________________
CROSS-REFERENCE TABLE*
-------------------------- -------------------
Section of Trust Indenture Section of
Act of 1939, as amended Guarantee Agreement
-------------------------- -------------------
310(a)....................................................... 4.1(a)
310(b)....................................................... 4.1(c), 2.8
310(c)....................................................... Inapplicable
311(a)....................................................... 2.2(b)
311(b)....................................................... 2.2(b)
311(c)....................................................... Inapplicable
312(a)....................................................... 2.2(a)
312(b)....................................................... 2.2(b)
313.......................................................... 2.3
314(a)....................................................... 2.4
314(b)....................................................... Inapplicable
314(c)....................................................... 2.5
314(d)....................................................... Inapplicable
314(e)....................................................... 1.1, 2.5, 3.2
314(f)....................................................... 2.1, 3.2
315(a)....................................................... 3.1 (d)
315(b)....................................................... 2.7
315(c)....................................................... 3.1
315(d)....................................................... 3.1(d)
316(a)....................................................... 1.1, 2.6, 5.4
316(b)....................................................... 5.3
316(c)....................................................... 8.2
317(a)....................................................... Inapplicable
317(b)....................................................... Inapplicable
318(a)....................................................... 2.1(b)
318(b)....................................................... 2.1
318(c)....................................................... 2.1(a)
______________________________________________________________________________
* This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
i
TABLE OF CONTENTS
Page
----
Article I DEFINITIONS.................................................. 1
Section 1.1 Definitions.................................................. 1
Article II. TRUST INDENTURE ACT.......................................... 3
Section 2.1 Trust Indenture Act; Application............................. 3
Section 2.2 List of Holders; Preferential Claims......................... 4
Section 2.3 Reports by the Guarantee Trustee............................. 4
Section 2.4 Periodic Reports to the Guarantee Trustee.................... 4
Section 2.5 Evidence of Compliance with Conditions Precedent............. 4
Section 2.6 Events of Default; Waiver.................................... 4
Section 2.7 Conflicting Interests........................................ 5
Article III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE........... 5
Section 3.1 Powers and Duties of the Guarantee Trustee................... 5
Section 3.2 Certain Rights of Guarantee Trustee.......................... 6
Section 3.3 Compensation; Indemnity; Fees................................ 8
Section 3.4 Conflicting Interests........................................ 9
Article IV. GUARANTEE TRUSTEE............................................ 9
Section 4.1 Guarantee Trustee; Eligibility............................... 9
Section 4.2 Appointment, Removal and Resignation of the Guarantee Trustee 10
Article V. GUARANTEE.................................................... 10
Section 5.1 Guarantee.................................................... 10
Section 5.2 Waiver of Notice and Demand.................................. 10
Section 5.3 Obligations Not Affected..................................... 11
Section 5.4 Rights of Holders............................................ 11
Section 5.5 Guarantee of Payment......................................... 12
Section 5.6 Subordination................................................ 12
Section 5.7 Independent Obligations...................................... 12
Article VI. COVENANTS AND SUBORDINATION.................................. 12
Article VII. TERMINATION.................................................. 13
Section 7.1 Termination.................................................. 13
ii
TABLE OF CONTENTS
(continued)
Page
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Article VIII. MISCELLANEOUS................................................ 13
Section 8.1 Successors and Assigns....................................... 13
Section 8.2 Amendments................................................... 13
Section 8.3 Notices...................................................... 13
Section 8.4 Benefit...................................................... 14
Section 8.5 Interpretation............................................... 14
Section 8.6 Governing Law................................................ 15
iii
GUARANTEE AGREEMENT
GUARANTEE AGREEMENT, dated as of ________________ (this "Guarantee
Agreement"), entered into between SEMPRA ENERGY, a California corporation having
its principal office at 101 Ash Street, San Diego, California 92101 (the
"Guarantor"), and THE BANK OF NEW YORK, a New York banking corporation, as
trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
SEMPRA ENERGY CAPITAL TRUST II, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust, dated as
of ______________ (the "Declaration"), among Sempra Energy, a California
corporation (the "Company"), as Sponsor, the Property Trustee named therein, the
Delaware Trustee named therein, the Regular Trustees named therein and the
several Holders as defined therein, the Issuer is issuing $_______________
aggregate Liquidation Amount (as defined in the Declaration) of its ________ %
_______________ Preferred Securities, Series __ (Liquidation Amount $__ per
Preferred Security) (the "Preferred Securities"), representing undivided
beneficial interests in the assets of the Issuer and having the terms set forth
in the Declaration;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Common
Securities (as defined in the Declaration), will be used to purchase the
Subordinated Debt Securities (as defined in the Declaration) of the Company
which will be deposited with The Bank of New York, as Property Trustee under the
Declaration, as trust assets; and
WHEREAS, as incentive for the Holders to purchase Preferred Securities the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth herein, to pay to the Holders of the Preferred Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders from time to time of the Preferred Securities.
Article I.
DEFINITIONS
Section 1.1 Definitions. As used in this Guarantee Agreement, the terms set
-----------
forth below shall, unless the context otherwise requires, have the following
meanings. Capitalized or otherwise defined terms used but not otherwise defined
herein shall have the meanings assigned to such terms in the Declaration as in
effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Event of Default" means (i) a default by the Guarantor on any of its
payment obligations under this Guarantee Agreement and (ii) a default by the
Guarantor on any other obligation hereunder that remains uncured after 30 days
from the occurrence thereof.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) required to be paid on the
Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor at such time, (ii) the redemption price, including all
accumulated and unpaid Distributions to the date of redemption (the "Redemption
Price"), with respect to any Preferred Securities called for redemption by the
Issuer, to the extent the Issuer shall have funds on hand available therefor at
such time, and (iii) upon a voluntary or involuntary termination, winding-up or
liquidation of the Issuer, unless Subordinated Debt Securities are distributed
to the Holders, the lesser of (a) the aggregate of the Liquidation Amount of $__
per Preferred Security plus accumulated and unpaid Distributions on the
Preferred Securities to the date of payment, to the extent the Issuer shall have
funds on hand available therefor at such time and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution").
"Guarantee Trustee" has the meaning set forth in the preamble to this
Guarantee Agreement.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor
or the Guarantee Trustee.
"Indenture" means the Subordinated Indenture dated as of February 23, 2000
among the Company and The Bank of New York, as trustee thereunder.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount of the Preferred Securities" means, except
as provided in the Declaration and by the Trust Indenture Act, Holder(s) of
Preferred Securities voting separately as a class, who vote Preferred Securities
and the aggregate liquidation amount (including the stated amount that would be
paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentage is determined) of the
Preferred Securities voted by such Holders represents more than 50% of the above
stated aggregate liquidation amount of all Preferred Securities.
"Officer's Certificate" means a certificate signed by any one of the
Chairman of the Board, Chief Executive Officer, President, a Vice President, the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Guarantee Trustee. Any Officer's Certificate delivered with
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respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(a) a statement that the officer signing the Officer's Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officer's
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Record Date" means, with respect to Preferred Securities that are held in
book-entry form, the date that is one Business Day before the relevant
Distribution Date, and with respect to Preferred Securities that are held in
definitive form, the 15th day, whether or not a Business Day, before the
relevant Distribution Date.
"Responsible Officer" means, with respect to the Guarantee Trustee, any
vice-president, any assistant vice-president, any assistant secretary, any
assistant treasurer, any trust officer or assistant trust officer or any other
officer of the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
Article II.
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
--------------------------------
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.
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(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
Section 2.2 List of Holders; Preferential Claims.
------------------------------------
(a) The Guarantor shall furnish or cause to be furnished to the
Guarantee Trustee (a) not later than 15 days after each Record Date of each
year, a list, in such form as the Guarantee Trustee may reasonably require,
containing all the information in the possession or control of the Guarantor, as
to of the names and addresses of the Holders ("List of Holders") as of the
preceding respective Record Date, and (b) at such other times as the Guarantee
Trustee may request in writing, within 30 days after the receipt by the
Guarantor of any such request, a list of similar form and content as of a date
not more than 15 days prior to the time such list is furnished. The Guarantee
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it, provided that the
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under
Section 311(a), Section 31l(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Guarantee Trustee. Not later than 60 days
--------------------------------
following _______ of each year, commencing ________, the Guarantee Trustee shall
provide to the Holders such reports as are required by Section 313 of the Trust
Indenture Act, if any, in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Guarantee Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
Section 2.4 Periodic Reports to the Guarantee Trustee. The Guarantor
-----------------------------------------
shall provide to the Guarantee Trustee such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314(a)(4) of the Trust Indenture
Act.
Section 2.5 Evidence of Compliance with Conditions Precedent. The
------------------------------------------------
Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with such conditions precedent, if any, provided for in this Guarantee Agreement
that relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to such Section 314(c)(1) may be given in the form of an Officer's
Certificate.
Section 2.6 Events of Default; Waiver. The Holders of a Majority in
-------------------------
Liquidation Amount of the Preferred Securities may, by vote, on behalf of the
Holders, waive any past Event of Default and its consequences. Upon such waiver,
any such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.
(a) Event of Default; Notice. The Guarantee Trustee shall, within 90
------------------------
days after the occurrence of an Event of Default actually known to a Responsible
Officer of the
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Guarantee Trustee, transmit by mail, first class postage prepaid, to the
Holders, notices of all such defaults unless such defaults have been cured
before the giving of such notice (the term "defaults" for the purposes of this
Section 2.6(a) being hereby defined to be an Event of Default as, not including
any periods of grace provided for therein and irrespective of the giving of any
notice provided therein); provided, that, except in the case of a default in the
payment of a Guarantee Payment, the Guarantee Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or Responsible Officers, of the
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders.
Section 2.7 Conflicting Interests. The Declaration and the Indenture
---------------------
shall be deemed to be specifically described in this Guarantee Agreement for the
purposes of clause (i) of the first proviso contained in Section 310(b) of the
Trust Indenture Act.
Article III.
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.1 Powers and Duties of the Guarantee Trustee.
------------------------------------------
(a) This Guarantee Agreement shall be held by the Guarantee Trustee
for the benefit of the Holders, and the Guarantee Trustee shall not transfer
this Guarantee Agreement to any Person except a Holder exercising his or her
rights pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the Guarantee
Trustee shall automatically vest in any Successor Guarantee Trustee, upon
acceptance by such Successor Guarantee Trustee of its appointment hereunder, and
such vesting and cessation of title shall be effective whether or not conveying
documents have been executed and delivered pursuant to the appointment of such
Successor Guarantee Trustee.
(b) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing or waiving of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants, duties or
obligations shall be read into this Guarantee Agreement against the Guarantee
Trustee. In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6), the Guarantee Trustee shall enforce this
Guarantee Agreement for the benefit of the Holders and shall exercise such of
the rights and powers vested in it by this Guarantee Agreement, and use the same
degree of care and skill in its exercise thereof, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(c) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct, except that:
(i) this Subsection shall not be construed to limit Subsection
(b) of this Section;
-5-
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that the Guarantee Trustee was negligent
in ascertaining the pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
Liquidation Amount of the Preferred Securities relating to the time, method
and place of conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in
the exercise of any of its rights or powers, if the Guarantee Trustee shall
have reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this Guarantee
Agreement or indemnity reasonably satisfactory to it against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of
this Guarantee Agreement relating to the conduct or affecting the liability of
or affording protection to the Guarantee Trustee shall be subject to the
provisions of this subsection.
Section 3.2 Certain Rights of Guarantee Trustee.
-----------------------------------
Subject to the provisions of Section 3.1:
(a) the Guarantee Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document reasonably believed by it to be genuine and to have been signed, sent
or presented by the proper party or parties; but in the case of any such
certificates or opinions that by any provision hereof or of the Trust Indenture
Act are specifically required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Guarantee Agreement;
(b) any direction or act of the Guarantor contemplated by this
Guarantee Agreement shall be sufficiently evidenced by an Officer's Certificate
unless otherwise prescribed herein;
(c) whenever, in the administration of this Guarantee Agreement, the
Guarantee Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting to take any action hereunder, the Guarantee
Trustee (unless other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively rely upon an
Officer's Certificate which, upon receipt of such request from the Guarantee
Trustee, shall be promptly delivered by the Guarantor;
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(d) the Guarantee Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(e) the Guarantee Trustee may consult with legal counsel of its
selection, and the written advice of such legal counsel or any Opinion of
Counsel with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in reliance thereon and in accordance with
such advice or Opinion of Counsel. Such legal counsel may be legal counsel to
the Guarantor or any of its Affiliates and may be one of its employees;
(f) the Guarantee Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Guarantee Agreement at the
request or direction of any Holders, unless such Holders shall have provided to
the Guarantee Trustee such adequate security and indemnity reasonably
satisfactory to it, against the costs, expenses (including reasonable attorneys'
fees and expenses) and liabilities that might be incurred by it in complying
with such request or direction;
(g) the Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Guarantee Trustee may make such further inquiry or
investigation into such facts or matters as it considers reasonably necessary in
order to carry out its obligations in the administration of this Guarantee
Agreement, and if the Guarantee Trustee shall determine to make such further
inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Guarantor, personally or by agent or attorney;
(h) the Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys, and the Guarantee Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent or attorney appointed
with due care by it hereunder;
(i) whenever in the administration of this Guarantee Agreement the
Guarantee Trustee shall deem it desirable to receive instructions with respect
to enforcing any remedy or right or taking any other action hereunder, the
Guarantee Trustee:
(i) may request written instructions from the Holders which
written instructions may only be given by the Holders of the same
proportion in aggregate Liquidation Amount of the Preferred Securities as
would be entitled to direct the Guarantee Trustee under the terms of the
Preferred Securities;
(ii) may refrain from enforcing such remedy or right or taking
such other action until such written instructions are received; and
(iii) shall be protected in acting in accordance with such
written instructions;
-7-
(j) except as otherwise expressly provided by this Guarantee
Agreement, the Guarantee Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Guarantee Agreement;
(k) the Guarantee Trustee shall not be deemed to have notice of any
default or Event of Default unless a Responsible Officer of the Guarantee
Trustee has actual knowledge thereof or unless written notice of any event which
is in fact such a default is received by the Guarantee Trustee at the Corporate
Trust Office of the Guarantee Trustee, and such notice references the Preferred
Securities and this Guarantee Agreement; and
(l) the rights, privileges, protections, immunities and benefits
given to the Guarantee Trustee, including, without limitation, its right to be
indemnified, are extended to each agent, custodian or other Person employed by
the Guarantee Trustee to act hereunder, and shall be enforceable by the
Guarantee Trustee in each of its capacities hereunder.
No provision of this Guarantee Agreement shall be deemed to impose any duty
or obligation on the Guarantee Trustee to perform any act or acts or exercise
any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
Section 3.3 Compensation; Indemnity; Fees. The Guarantor agrees:
-----------------------------
(a) to pay to the Guarantee Trustee from time to time such reasonable
compensation as shall be agreed to in writing between the Guarantor and the
Guarantee Trustee for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Guarantee Trustee upon request for all reasonable expenses, disbursements and
advances incurred or made by the Guarantee Trustee in accordance with any
provision of this Guarantee Agreement (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence or
willful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) the Guarantee Trustee, (ii) any Affiliate of the Guarantee
Trustee, (iii) any officer, director, shareholder, employee, representative or
agent of the Guarantee Trustee and (iv) any employee or agent of the Guarantee
Trustee or its Affiliates (referred to herein as an "Indemnified Person") from
and against any loss, damage, liability, tax, penalty, expense or claim of any
kind or nature whatsoever incurred by such Indemnified Person by or in
connection with the administration of this Guarantee Agreement and in a manner
such Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Guarantee Agreement, except that no
Indemnified Person shall be entitled to be indemnified
-8-
in respect of any loss, damage or claim incurred by such Indemnified Person by
reason of negligence or willful misconduct with respect to such acts or
omissions.
The provisions of this Section 3.3 shall survive the termination of this
Guarantee Agreement or the resignation or removal of the Guarantee Trustee.
The Guarantee Trustee may not claim any lien or charge on any Trust
Property as a result of any amount due pursuant to this Section 3.3.
The Guarantor and the Guarantee Trustee (subject to Section 3.4) may engage
in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Guarantor, and neither the Guarantor nor the Holders shall have any
rights by virtue of this Guarantee Agreement in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the business of the Guarantor, shall not be deemed
wrongful or improper. The Guarantee Trustee shall not be obligated to present
any particular investment or other opportunity to the Guarantor even if such
opportunity is of a character that, if presented to the Guarantor, could be
taken by the Guarantor, and the Guarantee Trustee shall have the right to take
for its own account (individually or as a partner or fiduciary) or to recommend
to others any such particular investment or other opportunity. The Guarantee
Trustee may engage or be interested in any financial or other transaction with
the Guarantor or any Affiliate of the Guarantor, or may act as depository for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Guarantor or its Affiliates.
Section 3.4 Conflicting Interests. If the Guarantee Trustee has or shall
---------------------
acquire a conflicting interest within the meaning of the Trust Indenture Act,
the Guarantee Trustee shall either eliminate such interest or resign, to the
extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Guarantee Agreement. The Guarantee Agreement is
hereby excluded for purposes of Section 310(b)(1) of the Trust Indenture Act.
Article IV.
GUARANTEE TRUSTEE
Section 4.1 Guarantee Trustee; Eligibility.
------------------------------
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at
least $50,000,000, and shall be a corporation meeting the requirements of
Section 310(a) of the Trust Indenture Act. If such corporation publishes
reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority, then, for the
purposes of this Section and to the extent permitted by the Trust Indenture
Act, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent
report of condition so published.
-9-
(b) If at any time the Guarantee Trustee shall cease to be eligible
to so act under Section 4.1(a), the Guarantee Trustee shall immediately resign
in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
Section 4.2 Appointment, Removal and Resignation of the Guarantee Trustee.
-------------------------------------------------------------
(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed
or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a Successor
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Guarantee Trustee and delivered to
the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office until
a Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 30 days after
delivery to the Guarantor of an instrument of resignation or notice of removal
pursuant to this Section 4.2, the Guarantee Trustee resigning or being removed,
as the case may be, may petition, at the expense of the Guarantor, any court of
competent jurisdiction for appointment of a Successor Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Guarantee Trustee.
Article V.
GUARANTEE
Section 5.1 Guarantee. The Guarantor irrevocably and unconditionally
---------
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by or on behalf of the Issuer), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer may
have or assert. The Guarantor's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Issuer to pay such amounts to the Holders.
Section 5.2 Waiver of Notice and Demand. The Guarantor hereby waives
---------------------------
notice of acceptance of this Guarantee Agreement and of any liability to which
it applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee
-10-
Trustee, Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
Section 5.3 Obligations Not Affected. The obligations, covenants,
------------------------
agreements and duties of the Guarantor under this Guarantee Agreement shall in
no way be affected or impaired by reason of the happening from time to time of
any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment of
Distributions that results from the extension of any interest payment period on
the Subordinated Debt Securities as provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders or the Guarantee Trustee to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the terms of the
Preferred Securities, or any action on the part of the Issuer granting
indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
the consent of, the Guarantor with respect to the happening of any of the
foregoing.
Section 5.4 Rights of Holders. The Guarantor expressly acknowledges that:
-----------------
(i) this Guarantee Agreement will be deposited with the
Guarantee Trustee to be held for the benefit of the Holders; (ii) the
Guarantee Trustee has the right to enforce this Guarantee Agreement on
behalf of the Holders; (iii) the Holders of a Majority in Liquidation
Amount of the Preferred Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to
the
-11-
Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement; and (iv) any Holder may institute a legal proceeding directly
against the Guarantor to enforce its rights under this Guarantee Agreement,
without first instituting a legal proceeding against the Guarantee Trustee,
the Issuer or any other Person.
Section 5.5 Guarantee of Payment. This Guarantee Agreement creates a
--------------------
guarantee of payment and not of performance or collection. This Guarantee
Agreement will not be discharged except by payment of the Guarantee Payments in
full (without duplication of amounts theretofore paid by the Issuer) or upon
distribution of Subordinated Debt Securities to Holders as provided in the
Declaration.
Section 5.6 Subordination. The Guarantor shall be subrogated to all (if
-------------
any) rights of the Holders against the Issuer, in respect of any amounts paid to
the Holders by the Guarantor under this Guarantee Agreement, and shall have the
right to waive payment by the Issuer pursuant to Section 5.1; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which it may
acquire against the Issuer by way of subrogation or any indemnity, reimbursement
or other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Guarantee Agreement. If any amount shall be paid to the Guarantor in
violation of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Holders.
Section 5.7 Independent Obligations. The Guarantor acknowledges that its
-----------------------
obligations hereunder are independent of the obligations of the Issuer with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.3 hereof.
Article VI.
COVENANTS AND SUBORDINATION
The obligations of the Guarantor under this Guarantee Agreement will
constitute unsecured obligations of the Guarantor and will rank:
(a) pari passu with any other preferred securities guarantee similar
to the guarantee under this Guarantee Agreement issued by the Guarantor on
behalf of the holders of preferred securities issued by any trust established by
the Guarantor or its Affiliates other than the Trust;
(b) subordinate and junior in right of payment to all of the
Guarantor's other liabilities, except those that rank pari passu or are
subordinate by their terms;
(c) pari passu with any guarantee now or hereafter issued by the
Guarantor in respect of the most senior preferred or preference stock now or
hereafter issued by the Guarantor, and with any guarantee now or hereafter
issued by it in respect of any preferred or preference stock of any of its
Affiliates; and
-12-
(d) senior to the Guarantor's common stock.
Article VII.
TERMINATION
Section 7.1 Termination. This Guarantee Agreement shall terminate and be
-----------
of no further force and effect upon (i) full payment of the Redemption Price of
all Preferred Securities, (ii) the distribution of Subordinated Debt Securities
to the Holders in exchange for all of the Preferred Securities or (iii) full
payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to Preferred Securities or this Guarantee Agreement.
Article VIII.
MISCELLANEOUS
Section 8.1 Successors and Assigns. All guarantees and agreements
----------------------
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities from time to time
outstanding. Except in connection with a consolidation, merger or sale involving
the Guarantor that is permitted under the Indenture and pursuant to which the
successor or assignee agrees in writing to perform the Guarantor's obligations
hereunder, the Guarantor shall not assign its obligations hereunder.
Section 8.2 Amendments. Except with respect to any changes which do not
----------
adversely affect the rights of the Holders in any material respect (in which
case no consent of the Holders will be required), this Guarantee Agreement may
only be amended with the prior written approval of the Holders of a Majority in
Liquidation Amount of the Preferred Securities. The provisions of Article VI of
the Declaration concerning meetings of the Holders shall apply to the giving of
such approval.
Section 8.3 Notices. Any notice, request or other communication required
-------
or permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below or such
other address, facsimile number or to the attention of such other Person as the
Guarantor may give notice to the Holders:
Sempra Energy
101 Ash Street
San Diego, California 92101
Facsimile No.: 619-696-4577
Attention: Treasurer
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(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) respective addresses set forth below or
such other address as the Guarantee Trustee on behalf of the Issuer may give
notice to the Holders:
Sempra Energy Capital Trust II
101 Ash Street
San Diego, California 92101
Facsimile No.: 619-696-4577
Attention: Regular Trustees of Sempra Energy Capital Trust II
with a copy to:
The Bank of New York
101 Barclay Street, 21-W
New York, New York 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust Administration
(c) if given to the Guarantee Trustee, at the Guarantee Trustee's
address set forth below or such other address as the Guarantee Trustee may give
notice to the Holders:
The Bank of New York
101 Barclay Street, 21-W
New York, New York 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust Administration
(d) if given to any Holder, at the address set forth on the books and
records of the Issuer.
All notices hereunder shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
Section 8.4 Benefit. This Guarantee Agreement is solely for the benefit
-------
of the Holders and is not separately transferable from the Preferred Securities.
Section 8.5 Interpretation. In this Guarantee Agreement, unless the
--------------
context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
-14-
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time;
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa;
and
(g) the masculine, feminine or neuter genders used herein shall
include the masculine, feminine and neuter genders.
Section 8.6 Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY
-------------
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
(Signatures follow)
-15-
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
SEMPRA ENERGY
By: _______________________________
Name:
Title:
THE BANK OF NEW YORK,
as Guarantee Trustee
By: _______________________________
Name:
Title:
S-1
EXHIBIT 4.9
GUARANTEE AGREEMENT
Between
SEMPRA ENERGY
(as Guarantor)
and
THE BANK OF NEW YORK
(as Trustee)
dated as of_____________________
CROSS-REFERENCE TABLE*
--------------------------------- -------------------------
Section of Trust Indenture Section of
Act of 1939, as amended of Guarantee Agreement
--------------------------------- --------------------------
310(a) ................................................................................. 4.1(a)
310(b) ................................................................................. 4.1(c), 2.8
310(c) ................................................................................. Inapplicable
311(a) ................................................................................. 2.2(b)
311(b) ................................................................................. 2.2(b)
311(c) ................................................................................. Inapplicable
312(a) ................................................................................. 2.2(a)
312(b) ................................................................................. 2.2(b)
313 ................................................................................. 2.3
314(a) ................................................................................. 2.4
314(b) ................................................................................. Inapplicable
314(c) ................................................................................. 2.5
314(d) ................................................................................. Inapplicable
314(e) ................................................................................. 1.1, 2.5, 3.2
314(f) ................................................................................. 2.1, 3.2
315(a) ................................................................................. 3.1(d)
315(b) ................................................................................. 2.7
315(c) ................................................................................. 3.1
315(d) ................................................................................. 3.1(d)
316(a) ................................................................................. 1.1, 2.6, 5.4
316(b) ................................................................................. 5.3
316(c) ................................................................................. 8.2
317(a) ................................................................................. Inapplicable
317(b) ................................................................................. Inapplicable
318(a) ................................................................................. 2.1(b)
318(b) ................................................................................. 2.1
318(c) ................................................................................. 2.1(a)
______________________________________________________________________________
* This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
i
TABLE OF CONTENTS
Page
----
Article I. DEFINITIONS............................................................. 1
Section 1.1 Definitions...................................................... 1
Article II. TRUST INDENTURE ACT.................................................... 3
Section 2.1 Trust Indenture Act; Application................................. 3
Section 2.2 List of Holders; Preferential Claims............................. 4
Section 2.3 Reports by the Guarantee Trustee................................. 4
Section 2.4 Periodic Reports to the Guarantee Trustee........................ 4
Section 2.5 Evidence of Compliance with Conditions Precedent................. 4
Section 2.6 Events of Default; Waiver........................................ 4
Section 2.7 Conflicting Interests............................................ 5
Article III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE.................... 5
Section 3.1 Powers and Duties of the Guarantee Trustee....................... 5
Section 3.2 Certain Rights of Guarantee Trustee.............................. 6
Section 3.3 Compensation; Indemnity; Fees.................................... 8
Section 3.4 Conflicting Interests............................................ 9
Article IV. GUARANTEE TRUSTEE...................................................... 9
Section 4.1 Guarantee Trustee; Eligibility................................... 9
Section 4.2 Appointment, Removal and Resignation of the Guarantee Trustee.... 10
Article V. GUARANTEE............................................................... 10
Section 5.1 Guarantee........................................................ 10
Section 5.2 Waiver of Notice and Demand...................................... 10
Section 5.3 Obligations Not Affected......................................... 11
Section 5.4 Rights of Holders................................................ 11
Section 5.5 Guarantee of Payment............................................. 12
Section 5.6 Subordination.................................................... 12
Section 5.7 Independent Obligations.......................................... 12
Article VI. COVENANTS AND SUBORDINATION............................................ 12
Article VII. TERMINATION........................................................... 13
Section 7.1 Termination...................................................... 13
ii
TABLE OF CONTENTS
(continued)
Page
----
Article VIII. MISCELLANEOUS........................................................ 13
Section 8.1 Successors and Assigns........................................... 13
Section 8.2 Amendments....................................................... 13
Section 8.3 Notices.......................................................... 13
Section 8.4 Benefit.......................................................... 14
Section 8.5 Interpretation................................................... 14
Section 8.6 Governing Law.................................................... 15
iii
GUARANTEE AGREEMENT
GUARANTEE AGREEMENT, dated as of ________________ (this "Guarantee
Agreement"), entered into between SEMPRA ENERGY, a California corporation having
its principal office at 101 Ash Street, San Diego, California 92101 (the
"Guarantor"), and THE BANK OF NEW YORK, a New York banking corporation, as
trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of
SEMPRA ENERGY CAPITAL TRUST III, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust, dated as
of ______________ (the "Declaration"), among Sempra Energy, a California
corporation (the "Company"), as Sponsor, the Property Trustee named therein, the
Delaware Trustee named therein, the Regular Trustees named therein and the
several Holders as defined therein, the Issuer is issuing $_______________
aggregate Liquidation Amount (as defined in the Declaration) of its ________ %
_______________ Preferred Securities, Series __ (Liquidation Amount $__ per
Preferred Security) (the "Preferred Securities"), representing undivided
beneficial interests in the assets of the Issuer and having the terms set forth
in the Declaration;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Common
Securities (as defined in the Declaration), will be used to purchase the
Subordinated Debt Securities (as defined in the Declaration) of the Company
which will be deposited with The Bank of New York, as Property Trustee under the
Declaration, as trust assets; and
WHEREAS, as incentive for the Holders to purchase Preferred Securities the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth herein, to pay to the Holders of the Preferred Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein;
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for
the benefit of the Holders from time to time of the Preferred Securities.
Article I.
DEFINITIONS
Section 1.1 Definitions. As used in this Guarantee Agreement, the terms
-----------
set forth below shall, unless the context otherwise requires, have the following
meanings. Capitalized or otherwise defined terms used but not otherwise defined
herein shall have the meanings assigned to such terms in the Declaration as in
effect on the date hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or
-1-
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Event of Default" means (i) a default by the Guarantor on any of its
payment obligations under this Guarantee Agreement and (ii) a default by the
Guarantor on any other obligation hereunder that remains uncured after 30 days
from the occurrence thereof.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) required to be paid on the
Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor at such time, (ii) the redemption price, including all
accumulated and unpaid Distributions to the date of redemption (the "Redemption
Price"), with respect to any Preferred Securities called for redemption by the
Issuer, to the extent the Issuer shall have funds on hand available therefor at
such time, and (iii) upon a voluntary or involuntary termination, winding-up or
liquidation of the Issuer, unless Subordinated Debt Securities are distributed
to the Holders, the lesser of (a) the aggregate of the Liquidation Amount of $__
per Preferred Security plus accumulated and unpaid Distributions on the
Preferred Securities to the date of payment, to the extent the Issuer shall have
funds on hand available therefor at such time and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution").
"Guarantee Trustee" has the meaning set forth in the preamble to this
Guarantee Agreement.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor
or the Guarantee Trustee.
"Indenture" means the Subordinated Indenture dated as of February 23, 2000
among the Company and The Bank of New York, as trustee thereunder.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount of the Preferred Securities" means, except
as provided in the Declaration and by the Trust Indenture Act, Holder(s) of
Preferred Securities voting separately as a class, who vote Preferred Securities
and the aggregate liquidation amount (including the stated amount that would be
paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentage is determined) of the
Preferred Securities voted by such Holders represents more than 50% of the above
stated aggregate liquidation amount of all Preferred Securities.
"Officer's Certificate" means a certificate signed by any one of the
Chairman of the Board, Chief Executive Officer, President, a Vice President, the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Guarantee Trustee. Any Officer's Certificate delivered with
-2-
respect to compliance with a condition or covenant provided for in this
Guarantee Agreement shall include:
(a) a statement that the officer signing the Officer's Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officer's
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Record Date" means, with respect to Preferred Securities that are held in
book-entry form, the date that is one Business Day before the relevant
Distribution Date, and with respect to Preferred Securities that are held in
definitive form, the 15th day, whether or not a Business Day, before the
relevant Distribution Date.
"Responsible Officer" means, with respect to the Guarantee Trustee, any
vice-president, any assistant vice-president, any assistant secretary, any
assistant treasurer, any trust officer or assistant trust officer or any other
officer of the Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
Article II.
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
--------------------------------
(a) This Guarantee Agreement is subject to the provisions of the
Trust Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.
-3-
(b) If and to the extent that any provision of this Guarantee
Agreement limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
Section 2.2 List of Holders; Preferential Claims.
------------------------------------
(a) The Guarantor shall furnish or cause to be furnished to the
Guarantee Trustee (a) not later than 15 days after each Record Date of each
year, a list, in such form as the Guarantee Trustee may reasonably require,
containing all the information in the possession or control of the Guarantor, as
to of the names and addresses of the Holders ("List of Holders") as of the
preceding respective Record Date, and (b) at such other times as the Guarantee
Trustee may request in writing, within 30 days after the receipt by the
Guarantor of any such request, a list of similar form and content as of a date
not more than 15 days prior to the time such list is furnished. The Guarantee
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it, provided that the
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations under
Section 311(a), Section 31l(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Guarantee Trustee.
--------------------------------
Not later than 60 days following _______ of each year, commencing ________,
the Guarantee Trustee shall provide to the Holders such reports as are required
by Section 313 of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.
Section 2.4 Periodic Reports to the Guarantee Trustee. The Guarantor
-----------------------------------------
shall provide to the Guarantee Trustee such documents, reports and information,
if any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314(a)(4) of the Trust Indenture
Act.
Section 2.5 Evidence of Compliance with Conditions Precedent. The
------------------------------------------------
Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with such conditions precedent, if any, provided for in this Guarantee Agreement
that relate to any of the matters set forth in Section 314(c) of the Trust
Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to such Section 314(c)(1) may be given in the form of an Officer's
Certificate.
Section 2.6 Events of Default; Waiver. The Holders of a Majority in
-------------------------
Liquidation Amount of the Preferred Securities may, by vote, on behalf of the
Holders, waive any past Event of Default and its consequences. Upon such waiver,
any such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.
-4-
(a) Event of Default; Notice. The Guarantee Trustee shall, within 90
------------------------
days after the occurrence of an Event of Default actually known to a Responsible
Officer of the Guarantee Trustee, transmit by mail, first class postage prepaid,
to the Holders, notices of all such defaults unless such defaults have been
cured before the giving of such notice (the term "defaults" for the purposes of
this Section 2.6(a) being hereby defined to be an Event of Default as, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); provided, that, except in the case of a
default in the payment of a Guarantee Payment, the Guarantee Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee, or a trust committee of directors and/or Responsible
Officers, of the Guarantee Trustee in good faith determines that the withholding
of such notice is in the interests of the Holders.
Section 2.7 Conflicting Interests. The Declaration and the Indenture
---------------------
shall be deemed to be specifically described in this Guarantee Agreement for the
purposes of clause (i) of the first proviso contained in Section 310(b) of the
Trust Indenture Act.
Article III.
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.1 Powers and Duties of the Guarantee Trustee.
------------------------------------------
(a) This Guarantee Agreement shall be held by the Guarantee Trustee
for the benefit of the Holders, and the Guarantee Trustee shall not transfer
this Guarantee Agreement to any Person except a Holder exercising his or her
rights pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee. The right, title and interest of the Guarantee
Trustee shall automatically vest in any Successor Guarantee Trustee, upon
acceptance by such Successor Guarantee Trustee of its appointment hereunder, and
such vesting and cessation of title shall be effective whether or not conveying
documents have been executed and delivered pursuant to the appointment of such
Successor Guarantee Trustee.
(b) The Guarantee Trustee, before the occurrence of any Event of
Default and after the curing or waiving of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Guarantee Agreement, and no implied covenants, duties or
obligations shall be read into this Guarantee Agreement against the Guarantee
Trustee. In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6), the Guarantee Trustee shall enforce this
Guarantee Agreement for the benefit of the Holders and shall exercise such of
the rights and powers vested in it by this Guarantee Agreement, and use the same
degree of care and skill in its exercise thereof, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(c) No provision of this Guarantee Agreement shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct, except that:
-5-
(i) this Subsection shall not be construed to limit Subsection
(b) of this Section;
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that the Guarantee Trustee was negligent
in ascertaining the pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
Liquidation Amount of the Preferred Securities relating to the time, method
and place of conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or in
the exercise of any of its rights or powers, if the Guarantee Trustee shall
have reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this Guarantee
Agreement or indemnity reasonably satisfactory to it against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of
this Guarantee Agreement relating to the conduct or affecting the liability of
or affording protection to the Guarantee Trustee shall be subject to the
provisions of this subsection.
Section 3.2 Certain Rights of Guarantee Trustee. Subject to the
-----------------------------------
provisions of Section 3.1:
(a) the Guarantee Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document reasonably believed by it to be genuine and to have been signed, sent
or presented by the proper party or parties; but in the case of any such
certificates or opinions that by any provision hereof or of the Trust Indenture
Act are specifically required to be furnished to the Guarantee Trustee, the
Guarantee Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Guarantee Agreement;
(b) any direction or act of the Guarantor contemplated by this
Guarantee Agreement shall be sufficiently evidenced by an Officer's Certificate
unless otherwise prescribed herein;
(c) whenever, in the administration of this Guarantee Agreement, the
Guarantee Trustee shall deem it desirable that a matter be proved or established
taking, suffering or omitting to take any action hereunder, the Guarantee
Trustee (unless other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively rely
-6-
upon an Officer's Certificate which, upon receipt of such request from the
Guarantee Trustee, shall be promptly delivered by the Guarantor;
(d) the Guarantee Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(e) the Guarantee Trustee may consult with legal counsel of its
selection, and the written advice of such legal counsel or any Opinion of
Counsel with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in reliance thereon and in accordance with
such advice or Opinion of Counsel. Such legal counsel may be legal counsel to
the Guarantor or any of its Affiliates and may be one of its employees;
(f) the Guarantee Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Guarantee Agreement at the
request or direction of any Holders, unless such Holders shall have provided to
the Guarantee Trustee such adequate security and indemnity reasonably
satisfactory to it, against the costs, expenses (including reasonable attorneys'
fees and expenses) and liabilities that might be incurred by it in complying
with such request or direction;
(g) the Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Guarantee Trustee may make such further inquiry or
investigation into such facts or matters as it considers reasonably necessary in
order to carry out its obligations in the administration of this Guarantee
Agreement, and if the Guarantee Trustee shall determine to make such further
inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Guarantor, personally or by agent or attorney;
(h) the Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys, and the Guarantee Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent or attorney appointed
with due care by it hereunder;
(i) whenever in the administration of this Guarantee Agreement the
Guarantee Trustee shall deem it desirable to receive instructions with respect
to enforcing any remedy or right or taking any other action hereunder, the
Guarantee Trustee:
(i) may request written instructions from the Holders which
written instructions may only be given by the Holders of the same
proportion in aggregate Liquidation Amount of the Preferred Securities as
would be entitled to direct the Guarantee Trustee under the terms of the
Preferred Securities;
(ii) may refrain from enforcing such remedy or right or taking
such other action until such written instructions are received; and
-7-
(iii) shall be protected in acting in accordance with such
written instructions;
(j) except as otherwise expressly provided by this Guarantee
Agreement, the Guarantee Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Guarantee Agreement;
(k) the Guarantee Trustee shall not be deemed to have notice of any
default or Event of Default unless a Responsible Officer of the Guarantee
Trustee has actual knowledge thereof or unless written notice of any event which
is in fact such a default is received by the Guarantee Trustee at the Corporate
Trust Office of the Guarantee Trustee, and such notice references the Preferred
Securities and this Guarantee Agreement; and
(l) the rights, privileges, protections, immunities and benefits
given to the Guarantee Trustee, including, without limitation, its right to be
indemnified, are extended to each agent, custodian or other Person employed by
the Guarantee Trustee to act hereunder, and shall be enforceable by the
Guarantee Trustee in each of its capacities hereunder.
No provision of this Guarantee Agreement shall be deemed to impose any duty
or obligation on the Guarantee Trustee to perform any act or acts or exercise
any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
Section 3.3 Compensation; Indemnity; Fees. The Guarantor agrees:
-----------------------------
(a) to pay to the Guarantee Trustee from time to time such reasonable
compensation as shall be agreed to in writing between the Guarantor and the
Guarantee Trustee for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Guarantee Trustee upon request for all reasonable expenses, disbursements and
advances incurred or made by the Guarantee Trustee in accordance with any
provision of this Guarantee Agreement (including the reasonable compensation and
the expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence or
willful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) the Guarantee Trustee, (ii) any Affiliate of the Guarantee
Trustee, (iii) any officer, director, shareholder, employee, representative or
agent of the Guarantee Trustee and (iv) any employee or agent of the Guarantee
Trustee or its Affiliates (referred to herein as an "Indemnified Person") from
and against any loss, damage, liability, tax, penalty, expense or claim of any
kind or nature whatsoever incurred by such Indemnified Person by or in
connection with the administration of this Guarantee Agreement and in a manner
such Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by
-8-
this Guarantee Agreement, except that no Indemnified Person shall be entitled to
be indemnified in respect of any loss, damage or claim incurred by such
Indemnified Person by reason of negligence or willful misconduct with respect to
such acts or omissions.
The provisions of this Section 3.3 shall survive the termination of this
Guarantee Agreement or the resignation or removal of the Guarantee Trustee.
The Guarantee Trustee may not claim any lien or charge on any Trust
Property as a result of any amount due pursuant to this Section 3.3.
The Guarantor and the Guarantee Trustee (subject to Section 3.4) may engage
in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Guarantor, and neither the Guarantor nor the Holders shall have any
rights by virtue of this Guarantee Agreement in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the business of the Guarantor, shall not be deemed
wrongful or improper. The Guarantee Trustee shall not be obligated to present
any particular investment or other opportunity to the Guarantor even if such
opportunity is of a character that, if presented to the Guarantor, could be
taken by the Guarantor, and the Guarantee Trustee shall have the right to take
for its own account (individually or as a partner or fiduciary) or to recommend
to others any such particular investment or other opportunity. The Guarantee
Trustee may engage or be interested in any financial or other transaction with
the Guarantor or any Affiliate of the Guarantor, or may act as depository for,
trustee or agent for, or act on any committee or body of holders of, securities
or other obligations of the Guarantor or its Affiliates.
Section 3.4 Conflicting Interests. If the Guarantee Trustee has or shall
---------------------
acquire a conflicting interest within the meaning of the Trust Indenture Act,
the Guarantee Trustee shall either eliminate such interest or resign, to the
extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Guarantee Agreement. The Guarantee Agreement is
hereby excluded for purposes of Section 310(b)(1) of the Trust Indenture Act.
Article IV.
GUARANTEE TRUSTEE
Section 4.1 Guarantee Trustee; Eligibility.
------------------------------
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at
least $50,000,000, and shall be a corporation meeting the requirements of
Section 310(a) of the Trust Indenture Act. If such corporation publishes
reports of condition at least annually, pursuant to law or to the
requirements of the supervising or examining authority, then, for the
purposes of this Section and to the extent permitted by the Trust Indenture
Act, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent
report of condition so published.
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(b) If at any time the Guarantee Trustee shall cease to be eligible
to so act under Section 4.1(a), the Guarantee Trustee shall immediately resign
in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
Section 4.2 Appointment, Removal and Resignation of the Guarantee Trustee.
-------------------------------------------------------------
(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed
or removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a Successor
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Guarantee Trustee and delivered to
the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office until
a Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 30 days after
delivery to the Guarantor of an instrument of resignation or notice of removal
pursuant to this Section 4.2, the Guarantee Trustee resigning or being removed,
as the case may be, may petition, at the expense of the Guarantor, any court of
competent jurisdiction for appointment of a Successor Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Guarantee Trustee.
Article V.
GUARANTEE
Section 5.1 Guarantee. The Guarantor irrevocably and unconditionally
---------
agrees to pay in full to the Holders the Guarantee Payments (without duplication
of amounts theretofore paid by or on behalf of the Issuer), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer may
have or assert. The Guarantor's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Issuer to pay such amounts to the Holders.
Section 5.2 Waiver of Notice and Demand. The Guarantor hereby waives
---------------------------
notice of acceptance of this Guarantee Agreement and of any liability to which
it applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee
-10-
Trustee, Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
Section 5.3 Obligations Not Affected. The obligations, covenants,
------------------------
agreements and duties of the Guarantor under this Guarantee Agreement shall in
no way be affected or impaired by reason of the happening from time to time of
any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions (other than an extension of time for payment of
Distributions that results from the extension of any interest payment period on
the Subordinated Debt Securities as provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders or the Guarantee Trustee to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the terms of the
Preferred Securities, or any action on the part of the Issuer granting
indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
the consent of, the Guarantor with respect to the happening of any of the
foregoing.
Section 5.4 Rights of Holders. The Guarantor expressly acknowledges that:
-----------------
(i) this Guarantee Agreement will be deposited with the Guarantee Trustee to be
held for the benefit of the Holders; (ii) the Guarantee Trustee has the right to
enforce this Guarantee Agreement on behalf of the Holders; (iii) the Holders of
a Majority in Liquidation Amount of the Preferred Securities have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee in respect of this Guarantee Agreement or
exercising any trust or power conferred upon the Guarantee Trustee under this
Guarantee
-11-
Agreement; and (iv) any Holder may institute a legal proceeding directly against
the Guarantor to enforce its rights under this Guarantee Agreement, without
first instituting a legal proceeding against the Guarantee Trustee, the Issuer
or any other Person.
Section 5.5 Guarantee of Payment. This Guarantee Agreement creates a
--------------------
guarantee of payment and not of performance or collection. This Guarantee
Agreement will not be discharged except by payment of the Guarantee Payments in
full (without duplication of amounts theretofore paid by the Issuer) or upon
distribution of Subordinated Debt Securities to Holders as provided in the
Declaration.
Section 5.6 Subordination. The Guarantor shall be subrogated to all (if
-------------
any) rights of the Holders against the Issuer, in respect of any amounts paid to
the Holders by the Guarantor under this Guarantee Agreement, and shall have the
right to waive payment by the Issuer pursuant to Section 5.1; provided, however,
that the Guarantor shall not (except to the extent required by mandatory
provisions of law) be entitled to enforce or exercise any rights which it may
acquire against the Issuer by way of subrogation or any indemnity, reimbursement
or other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Guarantee Agreement. If any amount shall be paid to the Guarantor in
violation of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount to the Holders.
Section 5.7 Independent Obligations. The Guarantor acknowledges that its
-----------------------
obligations hereunder are independent of the obligations of the Issuer with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.3 hereof.
Article VI.
COVENANTS AND SUBORDINATION
The obligations of the Guarantor under this Guarantee Agreement will
constitute unsecured obligations of the Guarantor and will rank:
(a) pari passu with any other preferred securities guarantee similar
to the guarantee under this Guarantee Agreement issued by the Guarantor on
behalf of the holders of preferred securities issued by any trust established by
the Guarantor or its Affiliates other than the Trust;
(b) subordinate and junior in right of payment to all of the
Guarantor's other liabilities, except those that rank pari passu or are
subordinate by their terms;
(c) pari passu with any guarantee now or hereafter issued by the
Guarantor in respect of the most senior preferred or preference stock now or
hereafter issued by the Guarantor, and with any guarantee now or hereafter
issued by it in respect of any preferred or preference stock of any of its
Affiliates; and
(d) senior to the Guarantor's common stock.
-12-
Article VII.
TERMINATION
Section 7.1 Termination. This Guarantee Agreement shall terminate and be
-----------
of no further force and effect upon (i) full payment of the Redemption Price of
all Preferred Securities, (ii) the distribution of Subordinated Debt Securities
to the Holders in exchange for all of the Preferred Securities or (iii) full
payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid with respect
to Preferred Securities or this Guarantee Agreement.
Article VIII.
MISCELLANEOUS
Section 8.1 Successors and Assigns. All guarantees and agreements
----------------------
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities from time to time
outstanding. Except in connection with a consolidation, merger or sale involving
the Guarantor that is permitted under the Indenture and pursuant to which the
successor or assignee agrees in writing to perform the Guarantor's obligations
hereunder, the Guarantor shall not assign its obligations hereunder.
Section 8.2 Amendments. Except with respect to any changes which do not
----------
adversely affect the rights of the Holders in any material respect (in which
case no consent of the Holders will be required), this Guarantee Agreement may
only be amended with the prior written approval of the Holders of a Majority in
Liquidation Amount of the Preferred Securities. The provisions of Article VI of
the Declaration concerning meetings of the Holders shall apply to the giving of
such approval.
Section 8.3 Notices. Any notice, request or other communication required
-------
or permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied or mailed by first class mail as
follows:
(a) if given to the Guarantor, to the address set forth below or such
other address, facsimile number or to the attention of such other Person as the
Guarantor may give notice to the Holders:
Sempra Energy
101 Ash Street
San Diego, California 92101
Facsimile No.: 619-696-4577
Attention: Treasurer
(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) respective addresses set forth below or
such other address as the Guarantee Trustee on behalf of the Issuer may give
notice to the Holders:
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Sempra Energy Capital Trust III
101 Ash Street
San Diego, California 92101
Facsimile No.: 619-696-4577
Attention: Regular Trustees of Sempra Energy Capital Trust III
with a copy to:
The Bank of New York
101 Barclay Street, 21-W
New York, New York 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust Administration
(c) if given to the Guarantee Trustee, at the Guarantee Trustee's
address set forth below or such other address as the Guarantee Trustee may give
notice to the Holders:
The Bank of New York
101 Barclay Street, 21-W
New York, New York 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust Administration
(d) if given to any Holder, at the address set forth on the books and
records of the Issuer.
All notices hereunder shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
Section 8.4 Benefit. This Guarantee Agreement is solely for the benefit
-------
of the Holders and is not separately transferable from the Preferred Securities.
Section 8.5 Interpretation. In this Guarantee Agreement, unless the
--------------
context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time;
-14-
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa;
and
(g) the masculine, feminine or neuter genders used herein shall
include the masculine, feminine and neuter genders.
Section 8.6 Governing Law. THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY
-------------
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
(Signatures follow)
-15-
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
is executed as of the day and year first above written.
SEMPRA ENERGY
By: _______________________________
Name:
Title:
THE BANK OF NEW YORK,
as Guarantee Trustee
By: _______________________________
Name:
Title:
S-1
Exhibit 4.10
DECLARATION OF TRUST
OF SEMPRA ENERGY CAPITAL TRUST II
DECLARATION OF TRUST ("Declaration") dated and effective as of April 22,
1999, by the undersigned trustees (together with all other Persons (as defined
herein) from time to time duly appointed and serving as trustees in accordance
with the provisions of this Declaration, the "Trustees") and the Parent (as
defined herein) as trust sponsor (the "Sponsor");
WHEREAS, the Trustees and the Sponsor desire to establish a trust (the
"Trust") pursuant to the Delaware Business Trust Act (as defined herein) for the
sole purpose of issuing and selling certain preferred securities, representing
undivided beneficial interests in the assets of the Trust, to the public and
certain common securities, representing undivided beneficial interests in the
assets of the Trust, to Sponsor, investing the proceeds thereof in certain
Subordinated Debt Securities (as defined herein) of the Parent; and distributing
the cash payments it receives on the subordinated debt securities it owns to the
holders of the preferred and common securities.
NOW, THEREFORE, it being the intention of the parties hereto that the Trust
constitute a business trust under the Delaware Business Trust Act and that this
Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests issued hereunder, subject to the
provisions of this Declaration.
ARTICLE I.
DEFINITIONS
SECTION 1.1. DEFINITIONS.
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration of Trust as modified, supplemented or amended from time to
time;
(d) all references in this Declaration to Articles and Sections and to
Exhibits are to Articles and Sections of and Exhibits to this Declaration unless
otherwise specified; and
(e) a reference to the singular includes the plural and vice versa.
"AFFILIATE" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended.
1
"BUSINESS DAY" means any day other than a day on which banking institutions
in New York, New York and California are authorized or required by law to close.
"COMMON SECURITY" means a security representing an undivided beneficial
interest in the Trust with such terms as may be set out in any amendment to this
Declaration.
"COVERED PERSON" means any employee or agent of the Trust or its
Affiliates.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et. seq., as it may be amended from time to
time.
"DELAWARE TRUSTEE" has the meaning set forth in Section 3.1.
"INDEMNIFIED PERSON" means any Trustee, any Affiliate of any Trustee or any
officers, directors, shareholders, members, partners, employees, representatives
or agents of any Trustee or any employee or agent of the Trust or its
Affiliates.
"PARENT" means Sempra Energy, a California corporation.
"PERSON" means any individual, joint venture, partnership, corporation,
association, joint stock company, limited liability company, trust,
unincorporated organization or other entity.
"PREFERRED SECURITY" means a security representing an undivided beneficial
interest in the assets of the Trust with such terms as may be set out in any
amendment to this Declaration.
"PROPERTY TRUSTEE" has the meaning set forth in Section 3.1.
"REGULAR TRUSTEE" means any Trustee other than the Delaware Trustee or the
Property Trustee.
"SECURITIES" means the Common Securities and the Preferred Securities.
"SPONSOR" means the Parent in its capacity as Sponsor of the Trust.
"SUBORDINATED DEBT SECURITIES" means the series of subordinated debt
securities to be issued by the Parent.
"TRUSTEE" or "TRUSTEES" means each Person who has signed the Declaration as
a trustee, so long as such Person shall continue in office in accordance with
the terms hereof, and all other Persons who may from time to time be duly
appointed, qualified and servicing as Trustees in accordance with the provisions
hereof, and references herein to a Trustee or the Trustee shall refer to such
Person or Persons solely in their capacity as trustees hereunder.
2
ARTICLE II.
ORGANIZATION
SECTION 2.1. NAME.
The Trust created by this Declaration is named "Sempra Energy Capital Trust
II." The Trust's activities may be conducted under the name of the Trust or any
other name deemed advisable by the Regular Trustees.
SECTION 2.2. OFFICE.
The address of the principal office of the Trust is 101 Ash Street, San
Diego, California 92101. At any time, the Regular Trustees may designate
another principal office.
SECTION 2.3. PURPOSE.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Securities and use the proceeds from such sale to acquire an equivalent amount
of the Subordinated Debt Securities, (b) distribute the cash payments it
receives on the Subordinated Debt Securities it owns to the holders of
Securities, and (c) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investment or, other than as
permitted herein, pledge any of its assets.
SECTION 2.4. AUTHORITY.
Subject to the limitations provided in this Declaration, the Regular
Trustees shall have exclusive and complete authority to carry out the purposes
of the Trust. An action taken by the Regular Trustees in accordance with their
powers shall constitute the act of and serve to bind the Trust. In dealing with
the Regular Trustees acting on behalf of the Trust, no Person shall be required
to inquire into the authority of the Regular Trustees to bind the Trust.
Persons dealing with the Trust are entitled to rely conclusively on the power
and authority of the Regular Trustees as set forth in this Declaration.
SECTION 2.5. TITLE TO PROPERTY OF THE TRUST.
Legal title to all assets of the Trust shall be vested in the Trust.
SECTION 2.6. POWERS OF THE TRUSTEES.
The Regular Trustees shall have the exclusive power and authority to cause
the Trust to engage in the following activities:
(a) to issue and sell Preferred Securities and Common Securities in
accordance with this Declaration and, in connection with such issue and sale, to
cause the Trust to file with the Securities and Exchange Commission a
registration statement on Form S-3 in relation to the Preferred Securities,
including any pre- and post-effective amendments thereto (including any
Registration Statement filed under Rule 462(b) of the Securities Act); provided,
however, that
3
the Trust may issue no more than one series of Preferred Securities and no more
than one series of Common Securities;
(b) employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors, and
consultants and provide for reasonable compensation for such services;
(c) to incur expenses which are necessary or incidental to carry out any
of the purposes of the Declaration;
(d) execute and enter into a Dealer Manager Agreement, Purchase Agreement
or Underwriting Agreement in connection with the issuance of Preferred
Securities; and
(e) execute all documents or instruments, perform all duties and powers,
and do all things for and on behalf of the Trust in all matters necessary or
incidental to the foregoing.
SECTION 2.7. FILING OF CERTIFICATE OF TRUST.
On or after the date of execution of this Declaration, the Trustees shall
cause the filing of a Certificate of Trust for the Trust with the Secretary of
State of the State of Delaware.
ARTICLE III.
TRUSTEES
SECTION 3.1. TRUSTEES.
The number of Trustees shall initially be five (5), and thereafter the
number of Trustees shall be such number as shall be fixed from time to time by a
written instrument signed by the Sponsor. The Sponsor is entitled to appoint or
remove without cause any Trustee at any time; PROVIDED, HOWEVER, that the number
of Trustees shall in no event be less than five (5); and PROVIDED, FURTHER, that
one Trustee, in the case of a natural person, shall be a person who is a
resident of the State of Delaware or which, if not a natural person, has its
principal place of business in the State of Delaware (the "Delaware Trustee").
Except as expressly set forth in this Declaration, any power of the Regular
Trustees may be exercised by, or with the consent of, a majority of the Regular
Trustees.
The initial Regular Trustees shall be Neal E. Schmale, Frank H. Ault and
Charles A. McMonagle, each having the same address as the Trust.
The initial Delaware Trustee shall be The Bank of New York (Delaware),
White Clay Center, Route 273, Newark, Delaware 19711. The initial property
trustee (the "Property Trustee") shall be The Bank of New York, 101 Barclay
Street, 21 West, New York, New York 10286.
SECTION 3.2. DELAWARE TRUSTEE AND PROPERTY TRUSTEE.
Notwithstanding any other provisions of this Declaration, neither the
Delaware Trustee nor the Property Trustee shall be entitled to exercise any of
the powers or shall have any of the responsibilities described in this
Declaration of the Regular Trustees. Further, the Delaware
4
Trustee shall be a Trustee for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Business Trust Act.
SECTION 3.3. EXECUTION OF DOCUMENTS.
(a) Any Regular Trustee is authorized to execute on behalf of the Trust
the Registration Statement referred to in Section 2.6(a) and any amendments
thereto and any other documents that the Regular Trustees have the power and
authority to execute pursuant to Section 2.6; and
(b) a Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing the Registration Statement referred to in
Section 2.6(a) and any amendment thereto or making any other governmental
filing.
ARTICLE IV.
LIMITATION OF LIABILITY OF
SPONSOR, TRUSTEES OR OTHERS
SECTION 4.1. LIABILITY.
(a) Except as expressly set forth in this Declaration, the Sponsor shall
not be:
(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the holders
of the Securities which shall be made solely from assets of
the Trust; and
(ii) the Sponsor shall not be required to pay to the Trust or to
any holder of Securities any deficit upon dissolution or
otherwise.
(b) The Sponsor shall be liable for all debts and obligations of the
Trust (other than with respect to the Securities) to the extent not satisfied
out of the Trust's assets.
SECTION 4.2. EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such acts or omissions;
(b) an Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the
5
value and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which distributions to
holders of Securities might properly be paid; and
(c) the recitals contained in this Declaration shall be taken as the
statements of the Sponsor, and the Trustees do not assume any responsibility for
their correctness. The Trustees make no representation as to the value or
condition of the property of the Trust or any part thereof. The Trustees make
no representations as to the validity or sufficiency of this Declaration.
SECTION 4.3. FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions
of this Declaration, to the extent that they restrict the duties and liabilities
of an Indemnified Person otherwise existing at law or in equity, are agreed by
the parties hereto to replace such other duties and liabilities of such
Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Person and any indemnified person; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall
act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such
interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give any
consideration to any interest of or factors affecting the
Trust or any other Person; or
6
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or by
applicable law.
SECTION 4.4. INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the Sponsor
shall indemnify and hold harmless each Indemnified Person from and against any
loss, damage or claim incurred by such Indemnified Person by reason of any act
or omission performed or omitted by such Indemnified Person in good faith on
behalf of the Trust and in a manner such Indemnified Person reasonably believed
to be within the scope of authority conferred on such Indemnified Person by this
Declaration, except that no Indemnified Person shall be entitled to be
indemnified in respect of any loss, damage or claim incurred by such Indemnified
Person by reason of gross negligence or willful misconduct with respect to such
acts or omissions.
(b) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by an Indemnified Person in defending any claim,
demand, action, suit or proceeding shall, from time to time, be advanced by the
Sponsor prior to the final disposition of such claim, demand, action, suit or
proceeding upon receipt by the Sponsor of an undertaking by or on behalf of the
Indemnified Person to repay such amount if it shall be determined that the
Indemnified Person is not entitled to be indemnified as authorized in Section
4.4(a).
SECTION 4.5. OUTSIDE BUSINESSES.
Any Covered Person, the Delaware Trustee and the Property Trustee may
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Trust, and the Trust and the holders of Securities shall have no rights
by virtue of this Declaration in and to such independent ventures or the income
or profits derived therefrom and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. No Covered Person, the Property Trustee or the Delaware Trustee shall
be obligated to present any particular investment or other opportunity to the
Trust even if such opportunity is of a character that, if presented to the
Trust, could be taken by the Trust, and any Covered Person, the Property Trustee
and the Delaware Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity.
ARTICLE V.
AMENDMENTS, TERMINATION, MISCELLANEOUS
SECTION 5.1. AMENDMENTS.
At any time before the issue of any Securities, this Declaration may be
amended by, and only by, a written instrument executed by all of the Regular
Trustees and the Sponsor; provided no amendment may alter or affect the Delaware
Trustee's or the Property Trustee's liabilities, rights or duties hereunder
without such trustee's prior written consent.
7
SECTION 5.2. TERMINATION OF TRUST.
(a) The Trust shall terminate and be of no further force or effect:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor or the revocation of
the Sponsor's charter or of the Trust's certificate of trust;
(iii) upon the entry of a decree of judicial dissolution of the
Sponsor or the Trust; or
(iv) before the issue of any Securities, with the consent of all
of the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an event referred
to in Section 5.2(a) and after satisfaction of the Trust, the Trustees shall
file a certificate of cancellation with the Secretary of State of the State of
Delaware.
SECTION 5.3. GOVERNING LAW.
This Declaration and the rights of the parties hereunder shall be governed
by and interpreted in accordance with the laws of the State of Delaware and all
rights and remedies shall be governed by such laws without regard to principles
of conflict of laws.
SECTION 5.4. HEADINGS.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.
SECTION 5.5. PARTIAL ENFORCEABILITY.
If any provision of this Declaration, or the application of such provision
to any Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such provision to Persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
SECTION 5.6. COUNTERPARTS.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
SEMPRA ENERGY,
as Sponsor
By: /s/ Neal E. Schmale
------------------------
Name: Neal E. Schmale
Title: Executive Vice President and Chief Financial Officer
Neal E. Schmale, as Regular Trustee
/s/ Neal E. Schmale
-----------------------------
Frank H. Ault, as Regular Trustee
/s/ Frank H. Ault
-----------------------------
Charles A. McMonagle, as Regular Trustee
/s/ Charles A. McMonagle
-----------------------------
The Bank of New York (Delaware),
as Delaware Trustee
By: /s/ Walter N. Gitlin
------------------------
Name: Walter N. Gitlin
Title: Authorized Signatory
The Bank of New York,
as Property Trustee
By: /s/ Michele L. Russo
------------------------
Name: Michele L. Russo
Title: Assistant Treasurer
S-1
Exhibit 4.11
DECLARATION OF TRUST
OF SEMPRA ENERGY CAPITAL TRUST III
DECLARATION OF TRUST ("Declaration") dated and effective as of April 22,
1999, by the undersigned trustees (together with all other Persons (as defined
herein) from time to time duly appointed and serving as trustees in accordance
with the provisions of this Declaration, the "Trustees") and the Parent (as
defined herein) as trust sponsor (the "Sponsor");
WHEREAS, the Trustees and the Sponsor desire to establish a trust (the
"Trust") pursuant to the Delaware Business Trust Act (as defined herein) for the
sole purpose of issuing and selling certain preferred securities, representing
undivided beneficial interests in the assets of the Trust, to the public and
certain common securities, representing undivided beneficial interests in the
assets of the Trust, to Sponsor; investing the proceeds thereof in certain
Subordinated Debt Securities (as defined herein) of the Parent; and distributing
the cash payments it receives on the subordinated debt securities it owns to the
holders of the preferred and common securities.
NOW, THEREFORE, it being the intention of the parties hereto that the Trust
constitute a business trust under the Delaware Business Trust Act and that this
Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests issued hereunder, subject to the
provisions of this Declaration.
ARTICLE I.
DEFINITIONS
SECTION 1.1. DEFINITIONS.
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to this
Declaration of Trust as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and to
Exhibits are to Articles and Sections of and Exhibits to this Declaration unless
otherwise specified; and
(e) a reference to the singular includes the plural and vice versa.
"AFFILIATE" has the same meaning as given to that term in Rule 405 of the
Securities Act of 1933, as amended.
"BUSINESS DAY" means any day other than a day on which banking institutions
in New York, New York and California are authorized or required by law to close.
"COMMON SECURITY" means a security representing an undivided beneficial
interest in the Trust with such terms as may be set out in any amendment to this
Declaration.
"COVERED PERSON" means any employee or agent of the Trust or its
Affiliates.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et. seq., as it may be amended from time to
time.
"DELAWARE TRUSTEE" has the meaning set forth in Section 3.1.
"INDEMNIFIED PERSON" means any Trustee, any Affiliate of any Trustee or any
officers, directors, shareholders, members, partners, employees, representatives
or agents of any Trustee or any employee or agent of the Trust or its
Affiliates.
"PARENT" means Sempra Energy, a California corporation.
"PERSON" means any individual, joint venture, partnership, corporation,
association, joint stock company, limited liability company, trust,
unincorporated organization or other entity.
"PREFERRED SECURITY" means a security representing an undivided beneficial
interest in the assets of the Trust with such terms as may be set out in any
amendment to this Declaration.
"PROPERTY TRUSTEE" has the meaning set forth in Section 3.1.
"REGULAR TRUSTEE" means any Trustee other than the Delaware Trustee or the
Property Trustee.
"SECURITIES" means the Common Securities and the Preferred Securities.
"SPONSOR" means the Parent in its capacity as Sponsor of the Trust.
"SUBORDINATED DEBT SECURITIES" means the series of subordinated debt
securities to be issued by the Parent.
"TRUSTEE" or "TRUSTEES" means each Person who has signed the Declaration as
a trustee, so long as such Person shall continue in office in accordance with
the terms hereof, and all other Persons who may from time to time be duly
appointed, qualified and servicing as Trustees in accordance with the provisions
hereof, and references herein to a Trustee or the Trustee shall refer to such
Person or Persons solely in their capacity as trustees hereunder.
ARTICLE II.
ORGANIZATION
SECTION 2.1. NAME.
The Trust created by this Declaration is named "Sempra Energy Capital Trust
III." The Trust's activities may be conducted under the name of the Trust or
any other name deemed advisable by the Regular Trustees.
2
SECTION 2.2. OFFICE.
The address of the principal office of the Trust is 101 Ash Street, San
Diego, California 92101. At any time, the Regular Trustees may designate another
principal office.
SECTION 2.3. PURPOSE.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Securities and use the proceeds from such sale to acquire an equivalent amount
of the Subordinated Debt Securities, (b) distribute the cash payments it
receives on the Subordinated Debt Securities it owns to the holders of
Securities, and (c) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investment or, other than as
permitted herein, pledge any of its assets.
SECTION 2.4. AUTHORITY.
Subject to the limitations provided in this Declaration, the Regular
Trustees shall have exclusive and complete authority to carry out the purposes
of the Trust. An action taken by the Regular Trustees in accordance with their
powers shall constitute the act of and serve to bind the Trust. In dealing with
the Regular Trustees acting on behalf of the Trust, no Person shall be required
to inquire into the authority of the Regular Trustees to bind the Trust.
Persons dealing with the Trust are entitled to rely conclusively on the power
and authority of the Regular Trustees as set forth in this Declaration.
SECTION 2.5. TITLE TO PROPERTY OF THE TRUST.
Legal title to all assets of the Trust shall be vested in the Trust.
SECTION 2.6. POWERS OF THE TRUSTEES.
The Regular Trustees shall have the exclusive power and authority to cause
the Trust to engage in the following activities:
(a) to issue and sell Preferred Securities and Common Securities in
accordance with this Declaration and, in connection with such issue and sale, to
cause the Trust to file with the Securities and Exchange Commission a
registration statement on Form S-3 in relation to the Preferred Securities,
including any pre- and post-effective amendments thereto (including any
Registration Statement filed under Rule 462(b) of the Securities Act); provided,
however, that the Trust may issue no more than one series of Preferred
Securities and no more than one series of Common Securities;
(b) employ or otherwise engage employees and agents (who may be designated
as officers with titles) and managers, contractors, advisors, and consultants
and provide for reasonable compensation for such services;
(c) to incur expenses which are necessary or incidental to carry out any
of the purposes of the Declaration;
3
(d) execute and enter into a Dealer Manager Agreement, Purchase Agreement
or Underwriting Agreement in connection with the issuance of Preferred
Securities; and
(e) execute all documents or instruments, perform all duties and powers,
and do all things for and on behalf of the Trust in all matters necessary or
incidental to the foregoing.
SECTION 2.7. FILING OF CERTIFICATE OF TRUST.
On or after the date of execution of this Declaration, the Trustees shall
cause the filing of a Certificate of Trust for the Trust with the Secretary of
State of the State of Delaware.
ARTICLE III.
TRUSTEES
SECTION 3.1. TRUSTEES.
The number of Trustees shall initially be five (5), and thereafter the
number of Trustees shall be such number as shall be fixed from time to time by a
written instrument signed by the Sponsor. The Sponsor is entitled to appoint or
remove without cause any Trustee at any time; PROVIDED, HOWEVER, that the number
of Trustees shall in no event be less than five (5); and PROVIDED, FURTHER, that
one Trustee, in the case of a natural person, shall be a person who is a
resident of the State of Delaware or which, if not a natural person, has its
principal place of business in the State of Delaware (the "Delaware Trustee").
Except as expressly set forth in this Declaration, any power of the Regular
Trustees may be exercised by, or with the consent of, a majority of the Regular
Trustees.
The initial Regular Trustees shall be Neal E. Schmale, Frank H. Ault and
Charles A. McMonagle, each having the same address as the Trust.
The initial Delaware Trustee shall be The Bank of New York (Delaware),
White Clay Center, Route 273, Newark, Delaware 19711. The initial property
trustee (the "Property Trustee") shall be The Bank of New York, 101 Barclay
Street, 21 West, New York, New York 10286.
SECTION 3.2. DELAWARE TRUSTEE AND PROPERTY TRUSTEE.
Notwithstanding any other provisions of this Declaration, neither the
Delaware Trustee nor the Property Trustee shall be entitled to exercise any of
the powers or shall have any of the responsibilities described in this
Declaration of the Regular Trustees. Further, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Delaware Business Trust Act.
SECTION 3.3. EXECUTION OF DOCUMENTS.
(a) Any Regular Trustee is authorized to execute on behalf of the Trust
the Registration Statement referred to in Section 2.6(a) and any amendments
thereto and any other documents that the Regular Trustees have the power and
authority to execute pursuant to Section 2.6; and
4
(b) a Regular Trustee may, by power of attorney consistent with applicable
law, delegate to any other natural person over the age of 21 his or her power
for the purposes of signing the Registration Statement referred to in Section
2.6(a) and any amendment thereto or making any other governmental filing.
ARTICLE IV.
LIMITATION OF LIABILITY OF
SPONSOR, TRUSTEES OR OTHERS
SECTION 4.1. LIABILITY.
(a) Except as expressly set forth in this Declaration, the Sponsor shall
not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the holders of the
Securities which shall be made solely from assets of the Trust;
and
(ii) the Sponsor shall not be required to pay to the Trust or to any
holder of Securities any deficit upon dissolution or otherwise.
(b) The Sponsor shall be liable for all debts and obligations of the Trust
(other than with respect to the Securities) to the extent not satisfied out of
the Trust's assets.
SECTION 4.2. EXCULPATION.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage or
claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such acts or omissions;
(b) an Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which distributions to
holders of Securities might properly be paid; and
(c) the recitals contained in this Declaration shall be taken as the
statements of the Sponsor, and the Trustees do not assume any responsibility for
their correctness. The Trustees make no representation as to the value or
condition of the property of the Trust or any part thereof. The Trustees make no
representations as to the validity or sufficiency of this Declaration.
5
SECTION 4.3. FIDUCIARY DUTY.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity, are agreed by the
parties hereto to replace such other duties and liabilities of such Indemnified
Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons and any Indemnified Person; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act
in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests
and factors as it desires, including its own interests, and shall
have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person;
or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and
shall not be subject to any other or different standard imposed
by this Declaration or by applicable law.
SECTION 4.4. INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the Sponsor shall
indemnify and hold harmless each Indemnified Person from and against any loss,
damage or claim incurred by such Indemnified Person by reason of any act or
omission performed or omitted by such
6
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of authority
conferred on such Indemnified Person by this Declaration, except that no
Indemnified Person shall be entitled to be indemnified in respect of any loss,
damage or claim incurred by such Indemnified Person by reason of gross
negligence or willful misconduct with respect to such acts or omissions.
(b) To the fullest extent permitted by applicable law, expenses (including
legal fees) incurred by an Indemnified Person in defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by the Sponsor
prior to the final disposition of such claim, demand, action, suit or proceeding
upon receipt by the Sponsor of an undertaking by or on behalf of the Indemnified
Person to repay such amount if it shall be determined that the Indemnified
Person is not entitled to be indemnified as authorized in Section 4.4(a).
SECTION 4.5. OUTSIDE BUSINESSES.
Any Covered Person, the Delaware Trustee and the Property Trustee may
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Trust, and the Trust and the holders of Securities shall have no rights
by virtue of this Declaration in and to such independent ventures or the income
or profits derived therefrom and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. No Covered Person, the Property Trustee or the Delaware Trustee shall
be obligated to present any particular investment or other opportunity to the
Trust even if such opportunity is of a character that, if presented to the
Trust, could be taken by the Trust, and any Covered Person, the Property Trustee
and the Delaware Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity.
ARTICLE V.
AMENDMENTS, TERMINATION, MISCELLANEOUS
SECTION 5.1. AMENDMENTS.
At any time before the issue of any Securities, this Declaration may be
amended by, and only by, a written instrument executed by all of the Regular
Trustees and the Sponsor; provided no amendment may alter or affect the Delaware
Trustee's or the Property Trustee's liabilities, rights or duties hereunder
without such trustee's prior written consent.
SECTION 5.2. TERMINATION OF TRUST.
(a) The Trust shall terminate and be of no further force or effect:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or its equivalent
with respect to the Sponsor or the revocation of the Sponsor's
charter or of the Trust's certificate of trust;
7
(iii) upon the entry of a decree of judicial dissolution of the
Sponsor or the Trust; or
(iv) before the issue of any Securities, with the consent of all of
the Regular Trustees and the Sponsor.
(b) As soon as is practicable after the occurrence of an event referred to
in Section 5.2(a) and after satisfaction of liabilities of the Trust, the
Trustees shall file a certificate of cancellation with the Secretary of State of
the State of Delaware.
SECTION 5.3. GOVERNING LAW.
This Declaration and the rights of the parties hereunder shall be governed
by and interpreted in accordance with the laws of the State of Delaware and all
rights and remedies shall be governed by such laws without regard to principles
of conflict of laws.
SECTION 5.4. HEADINGS.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.
SECTION 5.5. PARTIAL ENFORCEABILITY.
If any provision of this Declaration, or the application of such provision
to any Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.
SECTION 5.6. COUNTERPARTS.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.
[SIGNATURE PAGE FOLLOWS]
8
IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.
SEMPRA ENERGY,
as Sponsor
By: /s/ Neal E. Schmale
-------------------------------------
Name: Neal E. Schmale
Title: Executive Vice President and Chief
Financial Officer
Neal E. Schmale, as Regular Trustee
/s/ Neal E. Schmale
--------------------------------------------
Frank H. Ault, as Regular Trustee
/s/ Frank H. Ault
--------------------------------------------
Charles A. McMonagle, as Regular Trustee
/s/ Charles A. McMonagle
--------------------------------------------
The Bank of New York (Delaware),
as Delaware Trustee
By: /s/ Walter N. Gitlin
-------------------------------------
Name: Walter N. Gitlin
Title: Authorized Signatory
The Bank of New York,
as Property Trustee
By: /s/ Michele L. Russo
-------------------------------------
Name: Michele L. Russo
Title: Assistant Treasurer
9
__________________________________________
AMENDED AND RESTATED DECLARATION
OF TRUST
of
Sempra Energy Capital Trust [_]
Dated as of [_], 200[__]
__________________________________________
SEMPRA ENERGY CAPITAL TRUST [_]
Certain Sections of this Declaration relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Act Section Declaration Section
--------------------------- -------------------
(S)310(a)(1)....................................................... 9.4
(a)(2) 9.4
(a)(3)...................................................... 9.6
(a)(4)...................................................... 3.6
(b)......................................................... 9.5
(S)311(a).......................................................... 9.10
(b)......................................................... 9.10
(S)312(a).......................................................... 2.2
(b)......................................................... 2.2
(c)......................................................... 2.2
(S)313(a).......................................................... 2.3(a)
(a)(4)...................................................... 2.3(b)
(b)......................................................... 2.3(c)
(c)......................................................... 11.8
(d)......................................................... 2.3(c)
(S)314(a).......................................................... 2.4
(b)......................................................... Not Applicable
(c)(1)...................................................... 2.5
(c)(2)...................................................... 2.5
(c)(3)...................................................... Not Applicable
(d)......................................................... Not Applicable
(e)......................................................... 2.5
(S)315(a).......................................................... 3.6
(b)......................................................... 2.7, 11.8
(c)......................................................... 3.6
(d)......................................................... 3.6
(e)......................................................... Not Applicable
(S)316(a).......................................................... Not Applicable
(a)(1)(A)................................................... Not Applicable
(a)(1)(B)................................................... Not Applicable
(a)(2)...................................................... Not Applicable
(b)......................................................... 2.6
(c)......................................................... 7.7
(S)317(a)(1)....................................................... Not Applicable
(a)(2)...................................................... Not Applicable
(b)......................................................... 6.8
(S)318(a).......................................................... 2.1
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to
be a part of this Declaration.
2
AMENDED AND RESTATED DECLARATION
OF TRUST
OF
SEMPRA ENERGY CAPITAL TRUST [_]
Dated as of [_], 200[_]
THIS AMENDED AND RESTATED DECLARATION OF TRUST, dated and effective as
of [_], 200[__] (this "Declaration"), by and among the undersigned trustees
(together with all other Persons from time to time duly appointed and serving as
trustees in accordance with the provisions of this Declaration, the "Trustees"),
Sempra Energy, a California corporation, as trust sponsor (the "Sponsor"), and
by the holders, from time to time, of the securities representing undivided
beneficial interests in the assets of the Sempra Energy Capital Trust [_] (the
"Trust") to be issued pursuant to this Declaration;
WHEREAS, certain of the Trustees and the Sponsor established the Trust
under the Business Trust Act (as defined herein) pursuant to a Declaration of
Trust, dated as of April 22, 1999 (the "Original Declaration") and a Certificate
of Trust filed with the Secretary of State of Delaware on April 22, 1999, for
the sole purpose of issuing and selling certain securities representing
undivided beneficial interests in the assets of the Trust and investing the
proceeds thereof in certain Subordinated Debt Securities (as defined herein) of
the Subordinated Debt Securities Issuer (as defined herein);
WHEREAS, the Sponsor and the Trustees desire to amend and restate the
Original Declaration as set forth herein to provide for, among other things, (i)
the issuance of the Common Securities by the Trust to the Sponsor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement (as defined herein), and (iii) the acquisition by the
Trust from the Sponsor of all of the right, title and interest in the
Subordinated Debt Securities (as defined herein); provided, however, that none
of the amendments hereto are intended to amend any of the provisions included in
the Declaration that are required be included in an indenture pursuant to the
Trust Indenture Act.
NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
3
ARTICLE I.
INTERPRETATION AND DEFINITIONS
Section 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same
meaning throughout;
(c) all references to "the Declaration" or "this Declaration" are
to this Amended and Restated Declaration of Trust, as modified, supplemented or
amended from time to time, including (i) all exhibits hereto and (ii) for all
purposes of this Declaration and any such modification, amendment or supplement,
the provisions of the Trust Indenture Act that are deemed to be a part of and
govern this Declaration and any such modification, amendment or supplement,
respectively;
(d) all references in this Declaration to "Articles" and
"Sections" and "Exhibits" are to Articles and Sections of and Exhibits to this
Declaration unless otherwise specified;
(e) the words "herein," "hereof," and "hereunder" and other words
of similar import refer to this Declaration as a whole and not to any particular
Article, Section or subdivision;
(f) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration; and
(g) a reference to the singular includes the plural and vice
versa.
In addition, the following terms shall have the meanings set forth
below.
"Act" has the meaning specified in Section 7.8.
"Additional Amount" means, with respect to Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Officers' Certificate establishing the terms of the Subordinated
Debt Securities pursuant to Section 303 of the Indenture) paid by the Sponsor on
a Like Amount of Subordinated Debt Securities for such period.
"Additional Sums" has the meaning specified in Section ___ of the
Officers' Certificate establishing the terms of the Subordinated Debt Securities
pursuant to Section 303 of the Indenture.
4
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" means The Bank of New York, a New York banking corporation,
other than in its capacity as Property Trustee or a Subordinated Debt Securities
Trustee.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in
the premises judging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjudication or
composition of or in respect of such Person under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Person or of any substantial part of its property or ordering
the winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or similar official) of
such Person or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission by it in writing of
its inability to pay its debts generally as they become due and its willingness
to be adjudicated a bankrupt, or the taking of corporate action by such Person
in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 11.9.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Sponsor to have been duly adopted by
the Sponsor's Board of Directors, or such committee of the Board of Directors or
officers of the Sponsor to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date of
such certification, and delivered to the Trustees.
"Book-Entry Preferred Securities Certificates" means a beneficial
interest in the Preferred Securities Certificates, ownership and transfers of
which shall be evidenced through book entries by a Clearing Agency as described
in Section 6.10.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed, or (c) a day on which the
Property Trustee's Corporate Trust
5
Office or the Corporate Trust Office of the Subordinated Debt Securities Trustee
is closed for business.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Sections 3801 et seq., as it may be amended from time to time,
or any successor legislation.
"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as depositary
for the Preferred Securities and in whose name or in the name of a nominee of
that organization, the Preferred Securities shall be registered in global form
and which shall undertake to effect book entry transfers and pledges of the
Preferred Securities. The Depository Trust Company will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means [__________], 200[_].
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor legislation.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
"Common Securities Guarantee" means the guarantee agreement dated as
of [____________], 200[_] of the Sponsor in respect of the Common Securities.
"Common Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $___ and having the rights provided
therefor in this Declaration, including the right to receive Distributions and a
Liquidation Distribution as provided herein.
"Common Securityholder" means the Holder from time to time of the
Common Securities.
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Annex II to Exhibit A.
"Corporate Trust Office" means (i) when used with respect to the
Property Trustee, the principal office of the Property Trustee located at 101
Barclay Street, Floor 21 West, New York, New York 10286, and (ii) when used
with respect to the Subordinated Debt
6
Securities Trustee, the principal office of the Subordinated Debt Securities
Trustee located at 101 Barclay Street, Floor 21 West, New York, New York 10286.
"Definitive Preferred Securities Certificates" means either or both
(as the context requires) of (a) Preferred Securities Certificates issued as
Book-Entry Preferred Securities Certificates as provided in Section 6.10(a) and
(b) Preferred Securities Certificates issued in certificated, fully registered
form as provided in Section 6.12.
"Delaware Trustee" means The Bank of New York (Delaware), a Delaware
banking corporation, solely in its capacity as Delaware Trustee of the Trust and
not in its individual capacity, or its successor in interest in such capacity,
or any successor trustee appointed as herein provided.
"Direct Action" has the meaning set forth in Section 3.6(c).
"Distribution" means a distribution payable to Securityholders in
accordance with Section 5.1.
"Distribution Date" has the meaning specified in Section 5.1(a).
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of an Indenture Event of Default; or
(b) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of 30
days, provided that no Deferral Period (as defined in the Officers' Certificate
establishing the Subordinated Debt Securities pursuant to Section 303 of the
Indenture) is continuing; or
(c) default by the Trust in the payment of any Redemption Price of any
Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of
any provision of this Declaration (other than a covenant or warranty a default
in the performance or breach of which is dealt with in clause (b) or (c) above)
and continuation of such default or breach for a period of 90 days after there
has been given, by registered or certified mail, to the defaulting Trustee or
Trustees by the Holders of at least 25% in aggregate Liquidation Amount of the
Outstanding Preferred Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Sponsor to appoint a Successor Property Trustee
within 60 days thereof.
7
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Guarantee" means the Guarantee Agreement executed and delivered by
the Guarantor and The Bank of New York, a New York banking corporation, as
trustee, contemporaneously with the execution and delivery of this Declaration,
for the benefit of the holders of the Preferred Securities, as amended from time
to time.
"Guarantor" means Sempra Energy, a California corporation, and its
successors and assigns.
"Indemnified Person" has the meaning specified in Section 9.3(a).
"Indenture" means the Indenture dated as of [___________], 200[_]
among the Subordinated Debt Securities Issuer and The Bank of New York, as
trustee, as supplemented by an Officers' Certificate (as defined in the
Indenture) dated as of [___________], 200[_] pursuant to Section 301 of the
Indenture.
"Indenture Event of Default" means an "Event of Default," as defined
in the Indenture, with respect to the Subordinated Debt Securities.
"Indenture Redemption Date" means, with respect to any Subordinated
Debt Securities to be redeemed under the Indenture, the date fixed for
redemption under the Indenture.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Legal Action" means any action to bring or defend, pay, collect,
compromise, arbitrate, resort to legal action, or otherwise adjust claims or
demands of or against the Trust.
"Like Amount" means (a) with respect to a redemption of Securities,
Securities having an aggregate Liquidation Amount equal to the aggregate
principal amount of Subordinated Debt Securities to be contemporaneously
redeemed or repaid in accordance with the Indenture the proceeds of which will
be used to pay the Redemption Price of such Securities, and (b) with respect to
a distribution of Subordinated Debt Securities to Securityholders in connection
with a dissolution or liquidation of the Trust, Subordinated Debt Securities
having an aggregate principal amount equal to the aggregate Liquidation Amount
of the Securities of the Holder to whom such Subordinated Debt Securities are
distributed.
"Liquidation Amount" means the stated amount of $___ per Security.
"Liquidation Date" means the date on which Subordinated Debt
Securities are to be distributed to Securityholders in connection with a
dissolution and liquidation of the Trust pursuant to Section 10.4(a).
8
"Liquidation Distribution" has the meaning specified in Section
10.4(d).
"Majority in Liquidation Amount of the Securities" means, except as
provided in the terms of the Preferred Securities and by the Trust Indenture
Act, Holder(s) of Preferred Securities or Common Securities voting together as a
single class or, as the context may require, Holder(s) of Preferred Securities
or Common Securities voting separately as a class, who vote Securities of a
relevant class and the aggregate liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus accrued and
unpaid Distributions to the date upon which the voting percentages are
determined) of the Securities voted by such Securityholders represents more than
50% of the above stated aggregate liquidation amount of all Securities of such
class.
"Officer's Certificate" means a certificate signed by any one of the
Chairman of the Board, Chief Executive Officer, President, a Vice President, the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary, of the Sponsor, and delivered to the
appropriate Trustee. The officer signing an Officer's Certificate given
pursuant to Section 3.7 shall be the principal executive, financial or
accounting officer of the Sponsor. Any Officer's Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that the officer signing the Officer's Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officer's Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Property Trustee or the Sponsor, and who shall be
reasonably acceptable to the Property Trustee.
"Original Declaration" has the meaning specified in the recitals to
this Declaration.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore executed and delivered under
this Declaration, except:
(a) Securities theretofore canceled by the Property Trustee or
delivered to the Property Trustee for cancellation;
(b) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any Paying
Agent for the
9
Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Declaration; and
(c) Securities which have been paid or in exchange for or in lieu of
which other Preferred Securities have been executed and delivered pursuant to
Sections 6.4, 6.5, 6.10 and 6.12; provided, however, that in determining whether
the Holders of the requisite Liquidation Amount of the Outstanding Preferred
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Preferred Securities owned by the Sponsor, any
Trustee or any Affiliate of the Sponsor or any Trustee shall be disregarded and
deemed not to be Outstanding, except that (i) in determining whether any Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Preferred Securities that such
Trustee knows to be so owned shall be so disregarded and (ii) the foregoing
proviso shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Sponsor, one or more of the Trustees and/or any such
Affiliate. Preferred Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the Regular Trustees the pledgee's right so to act with respect to such
Preferred Securities and that the pledgee is not the Sponsor or any Affiliate of
the Sponsor.
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed
pursuant to Section 6.8 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Bank in its trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Subordinated Debt Securities will be held and from which the
Property Trustee, through the Paying Agent, shall make payments to the
Securityholders in accordance with Sections 5.1 and 5.2.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Preferred Security" means an undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $____ and having the rights
provided therefor in this Declaration, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Annex I to Exhibit A.
10
"Property Trustee" means The Bank of New York, a New York banking
corporation, solely in its capacity as Property Trustee of the Trust and not in
its individual capacity, or its successor in interest in such capacity, or any
Successor Property Trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be
redeemed, the date fixed for such redemption by or pursuant to this Declaration;
provided that each Indenture Redemption Date and the Stated Maturity (as defined
in the Indenture) of the Subordinated Debt Securities shall be a Redemption Date
for a Like Amount of Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, allocated on a pro rata basis (based on
Liquidation Amounts) among the Securities.
"Regular Trustees" means each of ___________, ___________ and
___________, solely in such Person's capacity as Regular Trustee of the Trust
formed and continued hereunder and not in such Person's individual capacity, or
such Regular Trustee's successor in interest in such capacity, or any successor
trustee appointed as herein provided.
"Relevant Trustee" shall have the meaning specified in Section 9.7.
"Responsible Officer" means, with respect to the Property Trustee, any
Vice-President, any Assistant Vice-President, any Assistant Secretary, any
Assistant Treasurer, any Trust Officer or Assistant Trust Officer or any other
officer of the Property Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.
"Securities" means the Common Securities and the Preferred Securities.
"Securities Act" means the Securities Act of 1933, as amended, or any
successor legislation.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 6.4.
"Securityholder" or "Holder" means a Person in whose name a Security
or Securities is registered in the Securities Register, any such Person being a
beneficial owner within the meaning of the Business Trust Act; provided,
however, that in determining whether the Holders of the requisite amount of
Preferred Securities have voted on any matter provided for in this Declaration,
then for the purpose of any such determination, so long as Definitive Preferred
Securities Certificates have not been issued, the term Securityholders or
Holders as used herein shall refer to the Owners.
"Sponsor" means Sempra Energy, a California corporation, or any
permitted successor thereof under the Indenture, in its capacity as sponsor of
the Trust.
11
"Subordinated Debt Securities" means the ___% Subordinated Deferrable
Interest Notes, Series __, due _________ to be issued by the Subordinated Debt
Securities Issuer under the Indenture and to be held by the Property Trustee
pursuant to Section 3.14. A specimen certificate for such series of
Subordinated Debt Securities is attached hereto as Exhibit B.
"Subordinated Debt Securities Issuer" means Sempra Energy, a
California corporation.
"Subordinated Debt Securities Trustee" means The Bank of New York, as
trustee under the Indenture until a successor is appointed thereunder and
thereafter means such successor trustee.
"Successor Property Trustee" means a successor Trustee possessing the
qualifications to act as Property Trustee under Section 9.4.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel
from counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance of
the Preferred Securities under this Declaration, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the Subordinated Debt Securities,
(ii) interest payable by the Sponsor on the Subordinated Debt Securities is not,
or within 90 days after the date of such Opinion of Counsel, will not be,
deductible by the Sponsor, in whole or in part, for United States federal income
tax purposes or (iii) the Trust is, or will be within 90 days after the date of
such Opinion of Counsel, subject to more than a de minimis amount of other
taxes, duties, assessments or other governmental charges.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Subordinated Debt Securities, (b) any
cash on deposit in, or owing to, the Payment Account and (c) all proceeds and
rights in respect of the foregoing and any other property and assets for the
time being held or deemed to be held by the Property Trustee pursuant to the
trusts of this Declaration.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
12
"Underwriting Agreement" means the Pricing Agreement (including the
Underwriting Agreement incorporated by reference therein), dated [_________],
200[_], among the Trust, the Sponsor and the underwriters named therein.
"25% in aggregate Liquidation Amount of the Securities" means,
except as provided in the terms of the Preferred Securities and by the Trust
Indenture Act, Holder(s) of Securities voting together as a single class or, as
the context may require, Holder(s) of Preferred Securities or Common Securities,
voting separately as a class, who vote Securities of a relevant class and the
Liquidation Amount (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of the Securities
voted by such Holders represents 25% of the above stated aggregate Liquidation
Amount of all Securities of such class.
ARTICLE II.
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions;
(b) the Property Trustee shall be the only Trustee which is a
trustee for the purposes of the Trust Indenture Act;
(c) if and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control; and
(d) the application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
Section 2.2 Lists of Securityholders.
(a) Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide the Property Trustee (i) not later than 15 days after each
of ________, ________, _______ and ________ (each such date a "Regular Record
Date") of each year a list, in such form as the Property Trustee may reasonably
require, containing all the information in the possession or control of the
Sponsor, or any of its Paying Agents other than the Property Trustee, as to the
names and addresses of the Securityholders ("List of Holders") as of the
preceding respective Regular Record Date, and (ii) at such other times as the
Property Trustee may request in writing, within 30 days after the receipt by the
Trust of any such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished. The Property Trustee
shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it or which it receives in
its capacity as Paying Agent (if
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acting in such capacity), provided that the Property Trustee may destroy any
List of Holders previously given to it on receipt of a new List of Holders; and
(b) the Property Trustee shall comply with its obligations under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Property Trustee.
(a) Within 60 days after _________ of each year, commencing
_______, 200__, the Property Trustee shall provide to the Securityholders such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Property Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
(b) In addition, the Property Trustee shall transmit to all
Securityholders in accordance with Section 11.8, and to the Sponsor, a brief
report dated as of such ______ with respect to:
(i) its eligibility under Section 9.4 or, in lieu thereof, if
to the best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect; and
(ii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Securities.
(c) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Property Trustee with each national
stock exchange, the NASDAQ National Market or such other interdealer quotation
system or self-regulatory organization upon which the Securities are listed or
traded (information regarding each such listing to be provided to the Property
Trustee by the Sponsor), with the Commission and with the Sponsor.
Section 2.4 Periodic Reports to the Property Trustee.
Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
Section 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees, on behalf of the
Trust, shall provide to the Property Trustee such evidence of compliance with
any conditions precedent, if any, provided for in this Declaration which relate
to any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant
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to Section 314(c)(1) of the Trust Indenture Act may be given in the form of an
Officers' Certificate.
Section 2.6 Rights of Securityholders; Events of Default; Waiver.
(a) The legal title to the Trust Property is vested exclusively in
the Property Trustee (in its capacity as such) in accordance with Section 3.14,
and the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Securities and they shall have no right to call for any partition or division of
property, profits or rights of the Trust except as described below. The
Securities shall be personal property giving only the rights specifically set
forth therein and in this Declaration. The Securities shall have no preemptive
or similar rights and when issued and delivered to Securityholders against
payment of the purchase price therefor will be fully paid and nonassessable by
the Trust. The Securityholders, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(b) For so long as any Preferred Securities remain Outstanding,
if, upon an Indenture Event of Default, the Subordinated Debt Securities Trustee
fails or the holders of not less than 25% in principal amount of the outstanding
Subordinated Debt Securities fail to declare the principal of all of the
Subordinated Debt Securities to be immediately due and payable, the Holders of
at least 25% in aggregate Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Sponsor and the
Subordinated Debt Securities Trustee; and upon any such declaration such
principal amount of and the accrued interest on all of the Subordinated Debt
Securities shall become immediately due and payable, provided that the payment
of principal and interest on such Subordinated Debt Securities shall remain
subordinated to the extent provided in the Indenture.
(c) At any time after such a declaration of acceleration with
respect to the Subordinated Debt Securities has been made and before a judgment
or decree for payment of the money due has been obtained by the Subordinated
Debt Securities Trustee as in the Indenture provided, the Holders of a majority
in aggregate Liquidation Amount of the Outstanding Preferred Securities, by
written notice to the Property Trustee, the Sponsor and the Subordinated Debt
Securities Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Sponsor has paid or deposited with the Subordinated
Debt Securities Trustee a sum sufficient to pay
(A) all overdue interest on all of the Subordinated Debt
Securities which has become due otherwise than by such declaration
of acceleration;
(B) the principal of (and premium, if any, on) any
Subordinated Debt Securities which have become due otherwise than
by such declaration of acceleration and any interest thereon at the
rate or rates prescribed therefor in the Subordinated Debt
Securities or, if no such rate or rates are so provided, at the
rate of interest borne by the Subordinated Debt Securities;
15
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest which has become due otherwise than by
such declaration of acceleration at the rate or rates prescribed
therefor in the Subordinated Debt Securities or, if no such rate or
rates are so provided, at the rate of interest borne by the
Subordinated Debt Securities; and
(D) all sums paid or advanced by the Subordinated Debt
Securities Trustee under the Indenture and the reasonable
compensation, expenses, disbursements and advances of the Subordinated
Debt Securities Trustee and the Property Trustee, their agents and
counsel and any amounts due the Subordinated Debt Securities Trustee
under Section 607 of the Indenture; and
(ii) all Events of Default with respect to the Subordinated Debt
Securities, other than the non-payment of the principal of the Subordinated
Debt Securities which has become due solely by such acceleration, have been
cured or waived as provided in Section 513 of the Indenture.
(d) The Holders of a majority in aggregate Liquidation Amount of the
Outstanding Preferred Securities may, on behalf of the Holders of all the
Outstanding Preferred Securities, waive any past default under the Indenture,
except a default in the payment of principal or interest on the Subordinated
Debt Securities (unless such default has been cured and a sum sufficient to pay
all matured installments of interest and principal and accrued and unpaid
interest, if any, due otherwise than by acceleration has been deposited with the
Subordinated Debt Securities Trustee) or a default in respect of a covenant or
provision which under the Indenture cannot be modified or amended without the
consent of the holder of each outstanding Subordinated Debt Security. No such
rescission shall affect any subsequent default or impair any right consequent
thereon.
(e) Upon receipt by the Property Trustee of written notice declaring
such an acceleration, or rescission and annulment thereof, by Holders of the
Preferred Securities all or part of which is represented by Book-Entry Preferred
Securities Certificates, a record date shall be established for determining
Holders of Outstanding Preferred Securities entitled to join in such notice,
which record date shall be at the close of business on the day the Property
Trustee receives such notice. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 2.6(e).
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(f) A waiver of any Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Preferred Securities
constitutes a waiver of the corresponding Event of Default with respect to the
Preferred Securities under this Declaration. Any waiver of an Event of Default
under the Indenture by the Property Trustee at the direction of the Holders of
the Preferred Securities shall also be deemed to constitute a waiver by the
Holders of the Common Securities of the corresponding Event of Default under
this Declaration with respect to the Common Securities for all purposes of this
Declaration without further act, vote or consent of the Holders of the Common
Securities.
(g) The foregoing provisions of Sections 2.6(b) through (f) shall
be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Securities, as permitted by the Trust Indenture Act.
Section 2.7 Event of Default; Notice.
The Property Trustee shall, within 90 days after the occurrence of
an Event of Default with respect to the Securities known to the Property
Trustee, transmit by mail, first class postage prepaid, to the Securityholders,
the Regular Trustees and the Sponsor, notices of all such defaults unless such
defaults have been cured or waived before the giving of such notice (the term
"defaults" for the purposes of this Section 2.7 being hereby defined to be an
Event of Default as, not including any periods of grace provided for herein or
in the Indenture and irrespective of the giving of any notice provided herein or
in the Indenture); provided, that, except for a default in the payment of
principal of (or premium, if any) or interest on any of the Subordinated Debt
Securities or Preferred Securities, the Property Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or Responsible Officers, of the
Property Trustee in good faith determine that the withholding of such notice is
in the interests of the Securityholders.
ARTICLE III.
ESTABLISHMENT OF THE TRUST
Section 3.1 Name.
The Trust is named "Sempra Energy Capital Trust [ ]," as such name
may be modified from time to time by the Regular Trustees following written
notice to the Securityholders. The Trust's activities may be conducted under the
name of the Trust or any other name deemed advisable by the Regular Trustees.
Section 3.2 Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is
White Clay Center, Route 273, Newark, Delaware 19711, or such other address in
the State of Delaware as the Delaware Trustee may designate by written notice to
the Sponsor. The address of the principal office of the Trust is c/o Sempra
Energy, 101 Ash Street, San Diego, California, 92101.
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On ten (10) Business Days written notice to the Property Trustee and
Securityholders, the Regular Trustees may designate another principal office.
Section 3.3 Declaration of Trust; Purpose.
The exclusive purposes and functions of the Trust are (i) to issue
and sell Securities and use the proceeds from such sale to acquire the
Subordinated Debt Securities, (ii) to distribute the cash payments it receives
on the Subordinated Debt Securities it owns to the Securityholders, and (iii) to
engage in only those activities necessary, appropriate, convenient or incidental
thereto. The Sponsor hereby appoints the Trustees as trustees of the Trust, to
have all the rights, powers and duties to the extent set forth herein, and the
Trustees hereby accept such appointment. The Property Trustee hereby declares
that it will hold the Trust Property in trust upon and subject to the conditions
set forth herein for the benefit of the Trust and the Securityholders. The
Regular Trustees shall have all rights, powers and duties set forth herein and
in accordance with applicable law with respect to accomplishing the purposes of
the Trust. The Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities, of
the Trustees set forth herein. The Delaware Trustee shall be one of the Trustees
of the Trust for the sole and limited purpose of fulfilling the requirements of
Section 3807(a) of the Delaware Business Trust Act.
Section 3.4 Authority of Trustees.
The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Declaration. Subject to the limitations set forth in
Section 3.8, and in accordance with the following Sections 3.5 and 3.6, the
Trustees shall have the authority to enter into all transactions and agreements
determined by the Trustees to be appropriate in exercising the authority,
express or implied, otherwise granted to the Trustees under this Declaration,
and to perform all acts in furtherance thereof.
Section 3.5 Power and Authority of Regular Trustees.
(a) Without limiting Section 3.4, each Regular Trustee, acting
singly or collectively, shall have the power and authority to act on behalf of
the Trust, including, without limitation, with respect to the following matters:
(i) the issuance and sale of the Securities;
(ii) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust such other agreements as may be
necessary or desirable in connection with the purposes and function of the
Trust;
(iii) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and under state
securities or blue sky laws, and the qualification of this Declaration as a
trust indenture under the Trust Indenture Act;
(iv) assisting in the listing of the Preferred Securities
upon such securities exchange or exchanges as shall be determined by the
Sponsor and the registration of the Preferred Securities under the
Securities Exchange Act of 1934, as
18
amended, and the preparation and filing of all periodic and other reports
and other documents pursuant to the foregoing;
(v) assisting in the sending of notices (other than notices
of default) and other information regarding the Securities and the
Subordinated Debt Securities to the Securityholders in accordance with this
Declaration;
(vi) consenting to the appointment of a Paying Agent in
accordance with this Declaration;
(vii) execution of the Securities on behalf of the Trust in
accordance with this Declaration;
(viii) execution and delivery of closing certificates pursuant
to the Underwriting Agreement and application for a taxpayer identification
number for the Trust;
(ix) unless otherwise determined by the Sponsor, the Property
Trustee or the Holders of Preferred Securities representing more than 50%
of the aggregate Liquidation Amount of the Outstanding Preferred
Securities, or as otherwise required by the Delaware Business Trust Act or
the Trust Indenture Act, to execute on behalf of the Trust (either acting
alone or together with any or all of the Regular Trustees) any documents
that the Regular Trustees have the power to execute pursuant to this
Declaration; and
(x) the taking of any action incidental to the foregoing as
the Trustees may from time to time determine is necessary or advisable to
give effect to the terms of this Declaration for the benefit of the
Securityholders (without consideration of the effect of any such action on
any particular Securityholder).
(b) Notwithstanding anything herein to the contrary, the Trustees are
authorized, and the Regular Trustees are directed, to conduct the affairs of the
Trust and to operate the Trust so that (i) the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act, (ii) the
Trust will be classified as a grantor trust for United States Federal income tax
purposes and (iii) so that the Subordinated Debt Securities will be treated as
indebtedness of the Sponsor for United States Federal income tax purposes and
shall not take any action which is inconsistent with or contrary to these
purposes. In this connection, the Sponsor and the Trustees are authorized to
take any action, not inconsistent with applicable law, the Certificate of Trust
or this Declaration, that each of the Sponsor and the Trustees determines in its
discretion to be necessary or desirable for such purposes, as long as such
action does not adversely affect in any material respect the interests of the
Holders of the Preferred Securities.
(c) Subject to this Section 3.5, the Regular Trustees shall have none
of the powers or the authority of the Property Trustee set forth in Section 3.6.
(d) The Trust initially appoints the Property Trustee as transfer
agent and registrar for the Preferred Securities.
19
Section 3.6 Powers and Duties of the Property Trustee.
(a) The Property Trustee shall have the power, duty and authority
to act on behalf of the Trust with respect to the following matters:
(i) the establishment of the Payment Account;
(ii) the receipt of the Subordinated Debt Securities;
(iii) the collection of interest, principal and any other
payments made in respect of the Subordinated Debt Securities in the Payment
Account;
(iv) the distribution through the Paying Agent of amounts
owed to the Securityholders in respect of the Securities;
(v) the exercise of all of the rights, powers and
privileges of a holder of the Subordinated Debt Securities;
(vi) the sending of notices of default and other information
regarding the Securities and the Subordinated Debt Securities to the
Securityholders in accordance with this Declaration;
(vii) the distribution of the Trust Property in accordance
with the terms of this Declaration;
(viii) to the extent provided in this Declaration, assisting
in the winding up of the affairs of and liquidation of the Trust and the
preparation, execution and filing of the certificate of cancellation with
the Secretary of State of the State of Delaware;
(ix) after an Event of Default (other than under paragraph
(b), (c), (d) or (e) of the definition of such term if such Event of
Default is by or with respect to the Property Trustee) the taking of any
action incidental to the foregoing as the Property Trustee may from time to
time determine is necessary or advisable to give effect to the terms of
this Declaration and protect and conserve the Trust Property for the
benefit of the Securityholders (without consideration of the effect of any
such action on any particular Securityholder);
(x) any Legal Action which arises out of or in connection
with an Event of Default or the Property Trustee's duties and obligations
under this Declaration, the Business Trust Act or the Trust Indenture Act;
and
(xi) any of the duties, liabilities, powers or the authority
of the Regular Trustees set forth in Section 3.5(a)(v), (vi) and (x);
and in the event of a conflict between the actions of the Regular
Trustees and those of the Property Trustee, the actions of the Property Trustee
shall prevail.
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(b) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to the
terms of the Securities and this Declaration.
(c) If the Property Trustee fails to enforce its rights under the
Subordinated Debt Securities after a Holder of Preferred Securities has made a
written request, such Holder may, to the fullest extent permitted by law,
institute a legal proceeding against the Subordinated Debt Securities Issuer, to
enforce the Property Trustee's rights under the Subordinated Debt Securities,
without first instituting any legal proceeding against the Property Trustee or
any other Person. Notwithstanding the foregoing, if an Event of Default has
occurred and is continuing and such event is attributable to the failure of the
Subordinated Debt Securities Issuer to pay interest, premium, if any, or
principal on the Subordinated Debt Securities on the date such interest,
premium, if any, or principal is otherwise payable (or in the case of
redemption, on the redemption date), then Holders of at least 25% in aggregate
Liquidation Amount of the Preferred Securities may directly institute a
proceeding for enforcement of payment to such Holder of the principal of,
premium, if any, or interest on, the Subordinated Debt Securities having a
principal amount equal to the aggregate liquidation amount of the Preferred
Securities of such Holder (a "Direct Action"). Notwithstanding any payments made
to any Holders of Preferred Securities by the Subordinated Debt Securities
Issuer in connection with a Direct Action, the Subordinated Debt Securities
Issuer shall remain obligated to pay the principal of, premium, if any, or
interest on the Subordinated Debt Securities held by the Trust or the Property
Trustee of the Trust, and the Subordinated Debt Securities Issuer shall be
subrogated to the rights of the Holders of such Preferred Securities with
respect to payments on the Preferred Securities. Except as provided in the
preceding sentences and in the Preferred Securities Guarantee, the Holders of
Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Subordinated Debt Securities.
(d) No resignation of the Property Trustee shall be effective unless
either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation distributed to the Securityholders pursuant to the terms of
the Securities; or
(ii) a Successor Property Trustee has been appointed and accepted
that appointment in accordance with Section 9.8.
(e) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Subordinated Debt Securities
under the Indenture and, if an Event of Default occurs and is continuing, the
Property Trustee shall, for the benefit of Securityholders, enforce its rights
as holder of the Subordinated Debt Securities subject to the rights of the
Holders pursuant to the terms of such Securities and this Declaration.
(f) The Property Trustee may authorize one or more Paying Agents to
pay Distributions, redemption payments or liquidation payments on behalf of the
Trust with respect to the Preferred Securities and any such Paying Agent shall
comply with Section 317(b) of the Trust Indenture Act. Any Paying Agent may be
removed by the Property Trustee at any time and a successor Paying Agent or
additional Paying Agents may be appointed at any time by the Property Trustee.
21
(g) Subject to this Section 3.6, the Property Trustee shall have none
of the powers or the authority of the Regular Trustees set forth in Section 3.5
of this Declaration.
(h) The Property Trustee must exercise the powers set forth in this
Section 3.6 in a manner which is consistent with the purposes, functions and
characterization for United States federal income tax purposes of the Trust set
forth in Section 3.5(b) and the Property Trustee shall not take any action which
is inconsistent with or contrary to the purposes, functions and characterization
for United States federal income tax purposes of the Trust set out in Section
3.5(b) of this Declaration.
(i) The Property Trustee, before the occurrence of any Event of
Default and after the curing or waiver of all Events of Default that may have
occurred:
(i) shall undertake to perform only such duties as are
specifically set forth in this Declaration and in the terms of the
Securities, and no implied covenants, duties or obligations shall be read
into this Declaration against the Property Trustee; and
(ii) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Property Trustee and conforming
to the requirements of this Declaration; but in the case of any such
certificates or opinions that by any provision hereof are specifically
required to be furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine whether or not they
conform to the requirements of this Declaration.
In case an Event of Default has occurred (that has not been cured or
waived pursuant to Section 2.6), the Property Trustee shall exercise such of the
rights and powers vested in it by this Declaration, and use the same degree of
care and skill in their exercise or use, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs;
(j) no provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) this Subsection shall not be construed to limit Subsection
(i) of this Section;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities at the time outstanding relating to
the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or exercising any trust or power
conferred upon
22
the Property Trustee under this Declaration including, without limitation,
with respect to the Securities;
(iv) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree with
the Sponsor; and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to
the extent otherwise required by law;
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with their
respective duties under this Declaration, nor shall the Property Trustee be
liable for the default or misconduct of the Regular Trustees or the
Sponsor; and
(vi) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise incur
financial liability in the performance of any of its duties hereunder or in
the exercise of any of its rights or powers, if it shall have reasonable
ground for believing that the repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
(k) Whether or not therein expressly so provided, every
provision of this Declaration relating to the conduct or affecting the liability
of or affording protection to the Property Trustee shall be subject to the
provisions of this Section.
Section 3.7 Certain Rights of the Property Trustee.
Subject to the provisions of Section 3.6:
(a) if (i) in performing its duties under this Declaration the
Property Trustee is required to decide between alternative courses of action or
(ii) in construing any of the provisions of this Declaration the Property
Trustee finds the same ambiguous or inconsistent with any other provisions
contained herein or (iii) the Property Trustee is unsure of the application of
any provision of this Declaration, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this
Declaration, the Property Trustee shall take such action, or refrain from taking
such action, not inconsistent with this Declaration as it shall deem advisable
and in the best interests of the Securityholders, in which event the Property
Trustee shall have no liability except for its own bad faith, negligence or
willful misconduct;
(b) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by an Officer's
Certificate;
(c) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officer's Certificate which,
upon receipt of such request, shall be promptly delivered by the Sponsor or the
Regular Trustees;
23
(d) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any financing or
continuation statement or any filing under tax or securities laws) or any
rerecording, refiling or reregistration thereof;
(e) the Property Trustee may consult with counsel of its
selection (which counsel may be counsel to the Sponsor or any of its Affiliates,
and may include any of its employees) and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon and in accordance with such advice, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include any of its
employees; the Property Trustee shall have the right at any time to seek
instructions concerning the administration of this Declaration from any court of
competent jurisdiction at the expense of the Sponsor;
(f) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at the
request or direction of any of the Securityholders pursuant to this Declaration,
unless such Securityholders shall have offered to the Property Trustee security
or indemnity satisfactory to it against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or direction;
(g) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other paper
or document, but the Property Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and if
the Property Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Trust, personally or by agent or attorney at the expense of the Sponsor
and shall incur no liability or additional liability of any kind by reason of
such inquiry or investigation;
(h) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys;
(i) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee:
(i) may request written instructions from the
Securityholders which written instructions may only be given by the Holders
of the same proportion in aggregate Liquidation Amount of the Securities as
would be entitled to direct the Property Trustee under the terms of the
Securities in respect of such remedy, right or action;
(ii) may refrain from enforcing such remedy or right or
taking such other action until such written instructions are received; and
(iii) shall be protected in acting in accordance with such
written instructions; and
24
(j) except as otherwise expressly provided by this Declaration,
the Property Trustee shall not be under any obligation to take any action that
is discretionary under the provisions of this Declaration.
No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
Section 3.8 Prohibition of Actions by the Trust and the Trustees.
(a) So long as this Declaration remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees (acting on behalf of he Trust) shall not:
(i) acquire any investments other than the Subordinated
Debt Securities,
(ii) engage in any activities not authorized by this
Declaration,
(iii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests
therein, including to Securityholders, except as expressly provided herein,
(iv) take any action that would cause the Trust to fail or
cease to qualify as a "grantor trust" for United States federal income tax
purposes,
(v) incur any indebtedness for borrowed money or issue
any other debt or
(vi) take or consent to any action that would result in
the placement of a Lien on any of the Trust Property.
(b) The Property Trustee shall defend all claims and demands of
all Persons at any time claiming any Lien on any of the Trust Property adverse
to the interest of the Trust or the Securityholders in their capacity as
Securityholders; provided, however, that (x) all expenses relating to such
defense shall be borne by the Sponsor and (y) the Property Trustee shall be
fully indemnified by the Sponsor for all costs incurred in connection with such
defense.
Section 3.9 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Certificates shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees shall not be accountable for
the use or application by the Sponsor of the proceeds of the Subordinated Debt
Securities.
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Section 3.10 Organizational Expenses.
The Sponsor shall pay organizational expenses of the Trust as
they arise or shall, upon request of any Trustee, promptly reimburse such
Trustee for any such expenses paid by such Trustee. The Sponsor shall make no
claim upon the Trust Property for the payment of such expenses.
Section 3.11 Rights and Responsibilities of Sponsor.
In connection with the issue and sale of the Preferred
Securities, the Sponsor shall have the right and responsibility to assist the
Trust with respect to, or effect on behalf of the Trust, the following (and any
actions taken by the Sponsor in furtherance of the following prior to the date
of this Declaration are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the
Commission of prospectus supplements and the execution on behalf of the
Trust of post-effective amendments to the registration statement relating
to the Preferred Securities on the appropriate form in relation to the
Preferred Securities;
(ii) the determination of the States in which to take
appropriate action to qualify or register for sale all or part of the
Preferred Securities and the determination of any and all such acts, other
than actions which must be taken by or on behalf of the Trust, and the
advice to the Trustees of actions they must take on behalf of the Trust,
and the preparation for execution and filing of any documents to be
executed and filed by the Trust or on behalf of the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of
any such States;
(iii) the preparation for filing by the Trust and execution
on behalf of the Trust of an application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq National Market for listing
upon notice of issuance of any Preferred Securities;
(iv) the preparation for filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the Securities Exchange Act of
1934, as amended, including any amendments thereto, if required;
(v) the negotiation of the terms of, and the execution
and delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(vi) the taking of any other actions necessary or
desirable to carry out any of the foregoing activities.
Section 3.12 Issuance of Preferred Securities.
The Sponsor and the Trust have executed and delivered the
Underwriting Agreement. On the Closing Date, a Regular Trustee, on behalf of the
Trust, shall execute in accordance with Section 6.2, and upon written direction
the Property Trustee shall make
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available to the Underwriters named in the Underwriting Agreement, Preferred
Securities Certificates, registered in the name of the nominee of the initial
Clearing Agency, evidencing an aggregate of ___________ Preferred Securities
having an aggregate Liquidation Amount of $____________, against receipt by the
Property Trustee of the aggregate purchase price of such Preferred Securities of
$_____________, less applicable discounts and commissions.
Section 3.13 Issuance of Common Securities.
On the Closing Date, a Regular Trustee, on behalf of the Trust,
shall execute in accordance with Section 6.2, and the Property Trustee shall
deliver to the Sponsor, Common Securities Certificates, registered in the name
of the Sponsor, evidencing an aggregate of __________ Common Securities having
an aggregate Liquidation Amount of $________ against receipt by the Property
Trustee from the Sponsor of such amount. Contemporaneously therewith, a Regular
Trustee, on behalf of the Trust, shall subscribe to and purchase from the
Sponsor the Subordinated Debt Securities, registered in the name of the Property
Trustee (in its capacity as such) and having an aggregate principal amount equal
to $___________, and, in satisfaction of the purchase price for such
Subordinated Debt Securities, the Property Trustee, on behalf of the Trust,
shall deliver to the Sponsor the sum of $___________ (being the sum of the
amounts delivered to the Property Trustee pursuant to (i) the second sentence of
Section 3.12 and (ii) the first sentence of this Section 3.13).
Section 3.14 Title to Property of the Trust.
Except as provided in Section 3.6 with respect to the
Subordinated Debt Securities and the Payment Account or as otherwise provided in
this Declaration, legal title to all Trust Property shall be vested at all times
in the Property Trustee (in its capacity as such) and shall be held and
administered by the Property Trustee for the benefit of the Trust and the
Securityholders in accordance with this Declaration.
ARTICLE IV.
PAYMENT ACCOUNT
Section 4.1 Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall
establish the Payment Account. The Property Trustee and any agent of the
Property Trustee shall have exclusive control and sole right of withdrawal with
respect to the Payment Account for the purpose of making deposits in and
withdrawals from the Payment Account in accordance with this Declaration. All
monies and other property deposited or held from time to time in the Payment
Account shall be held by the Property Trustee in the Payment Account for the
exclusive benefit of the Securityholders and for distribution as herein
provided, including (and subject to) any priority of payments provided for
herein.
(b) The Property Trustee shall deposit in the Payment Account,
promptly upon receipt, all payments of principal of or interest on, and any
other payments or proceeds with
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respect to, the Subordinated Debt Securities. Amounts held in the Payment
Account shall not be invested by the Property Trustee pending distribution
thereof.
ARTICLE V.
DISTRIBUTIONS; REDEMPTION
Section 5.1 Distributions.
(a) The Securities represent undivided beneficial interests in
the Trust Property, and Distributions (including of Additional Amounts) will be
made on the Securities at the rate and on the dates that payments of interest
(including of Additional Interest, as defined in the Officers' Certificate
establishing the terms of the Subordinated Debt Securities pursuant to Section
303 of the Indenture) are made on the Subordinated Debt Securities. Accordingly:
(i) Distributions on the Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust available
for the payment of Distributions. Distributions shall accrue from
_________, 200__, and, except in the event (and to the extent) that the
Sponsor exercises its right to defer the payment of interest on the
Subordinated Debt Securities pursuant to the Indenture, shall be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of
each year, commencing on _________, 200[ ]. If any date on which a
Distribution is otherwise payable on the Securities is not a Business Day,
then the payment of such Distribution shall be made on the next succeeding
day that is a Business Day (and without any interest or other payment in
respect of any such delay) except that, if such Business Day is in the next
succeeding calendar year, payment of such Distribution shall be made on the
immediately preceding Business Day, in each case with the same force and
effect as if made on such date (each date on which distributions are
payable in accordance with this Section 5.1(a), a "Distribution Date").
(ii) Assuming payments of interest on the Subordinated
Debt Securities are made when due (and before giving effect to Additional
Amounts, if applicable), Distributions on the Securities shall be payable
at a rate ______% per annum of the Liquidation Amount of the Securities.
The amount of Distributions payable for any full period shall be computed
on the basis of a 360-day year of twelve 30-day months. The amount of
Distributions for any partial period shall be computed on the basis of the
number of days elapsed in a 360-day year of twelve 30-day months. The
amount of Distributions payable for any period shall include the Additional
Amounts, if any.
(iii) Distributions on the Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Distributions.
(b) Distributions on the Securities with respect to a
Distribution Date shall be payable to the Holders thereof as they appear on the
Securities Register for the Securities on the
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relevant record date, which shall be one Business Day prior to such Distribution
Date; provided, however, that in the event that the Preferred Securities do not
remain in book-entry-only form, the relevant record date shall be the date 15
days prior to the relevant Distribution Date.
Section 5.2 Redemption.
(a) On each Indenture Redemption Date and on the stated maturity
of the Subordinated Debt Securities, the Trust will be required to redeem a Like
Amount of Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee
at the expense of the Sponsor by first-class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date (or, in the
event that the redemption results from acceleration after the occurrence of an
Indenture Event of an Indenture Event of Default and the Property Trustee is
unable to give such notice within such period, as soon as practicable) to each
Securityholder to be redeemed, at such Holder's address appearing in the
Security Register. All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price will
become due and payable upon each such Trust Security to be redeemed and
that Distributions thereon will cease to accrue on and after said date,
except as provided in Section 5.2(d).
(c) The Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Subordinated Debt Securities. Redemptions of the Securities shall
be made and the Redemption Price shall be payable on each Redemption Date only
to the extent that the Trust has funds then on hand and available in the Payment
Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in
respect of any Preferred Securities, then, by 2:00 p.m., New York City time, on
the Redemption Date, subject to Section 5.2(c), the Property Trustee will, so
long as the Preferred Securities are in book-entry-only form, irrevocably
deposit with the Clearing Agency for the Preferred Securities funds sufficient
to pay the applicable Redemption Price and will give such Clearing Agency
instructions with respect to payment of the Redemption Price to the holders of
the Preferred Securities in accordance with the procedures set forth in the
applicable agreement between the Property Trustee and such Clearing Agency. If
the Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 5.2(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying
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Agent instructions and authority to pay the Redemption Price to the Holders
thereof upon surrender of their Preferred Securities Certificates in accordance
with the notice of redemption. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Securities called for
redemption shall be payable to the Holders of such Securities as they appear on
the Securities Register on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of
Securityholders holding Securities so called for redemption will cease, except
the right of such Securityholders to receive the Redemption Price and any
Distribution payable on or prior to the Redemption Date, but without interest,
and such Securities will cease to be outstanding. In the event that any date on
which any Redemption Price is payable is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day falls in the next calendar
year, such payment will be made on the immediately preceding Business Day, in
each case, with the same force and effect as if made on such date. In the event
that payment of the Redemption Price in respect of any Securities called for
redemption is improperly withheld or refused and not paid either by the Trust or
by the Guarantor pursuant to the Guarantee, Distributions on such Securities
will continue to accrue, at the then applicable rate, from the Redemption Date
originally established by the Trust for such Securities to the date such
Redemption Price is actually paid, in which case the actual payment date will be
the date fixed for redemption for purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Securities shall be
made to the recordholders thereof as they appear on the Securities Register for
the Securities on the relevant record date, which shall be one Business Day
prior to the relevant Redemption Date; provided, however, that in the event that
the Preferred Securities do not remain in book-entry-only form, the relevant
record date shall be the date 15 days prior to the relevant Redemption Date .
(f) Subject to Section 5.3(a), if less than all the Outstanding
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Securities to be redeemed shall be allocated on a pro rata
basis (based on Liquidation Amounts) among the Common Securities and the
Preferred Securities. The particular Preferred Securities and Common Securities
to be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities and Common Securities,
respectively, not previously called for redemption, by such method (including,
without limitation, by lot) as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $___ or an integral multiple of $___ in excess thereof) of the
Liquidation Amount of Preferred Securities and Common Securities, respectively,
of a denomination larger than $___. The Property Trustee shall promptly notify
the Security Registrar in writing of the Preferred Securities and Common
Securities selected for redemption and, in the case of any Preferred Securities
or Common Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For all purposes of this Declaration, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities or Preferred Securities shall relate, in the case of any Preferred
Securities or Common Securities, as applicable, redeemed or to be redeemed only
in part, to the portion of the Liquidation Amount of Preferred Securities or
Common Securities, as applicable, that has been or is to be redeemed.
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Section 5.3 Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, and the Redemption Price of, the Securities, as applicable,
shall be made, subject to Section 5.2(f), pro rata among the Common Securities
and the Preferred Securities based on the Liquidation Amount of the Securities;
provided, however, that if on any Distribution Date or Redemption Date any Event
of Default resulting from an Indenture Event of Default shall have occurred and
be continuing, no payment of any Distribution (including Additional Amounts, if
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities, shall have
been made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including Additional Amounts, if applicable) on, or the
Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default
resulting from any Indenture Event of Default, the Holder of Common Securities
will be deemed to have waived any right to act with respect to any such Event of
Default under this Declaration until the effect of all such Events of Default
with respect to the Preferred Securities have been cured, waived or otherwise
eliminated. Until any such Event of Default under this Declaration with respect
to the Preferred Securities has been so cured, waived or otherwise eliminated,
the Property Trustee shall act solely on behalf of the Holders of the Preferred
Securities and not the Holder of the Common Securities, and only the Holders of
the Preferred Securities will have the right to direct the Property Trustee to
act on their behalf.
Section 5.4 Payment Procedures.
Payments of Distributions (including Additional Amounts, if
applicable) in respect of the Preferred Securities shall be made by check mailed
to the address of the Person entitled thereto as such address shall appear on
the Securities Register or, if the Preferred Securities are held by a Clearing
Agency, such Distributions shall be made to the Clearing Agency in immediately
available funds, which shall credit the relevant Persons' accounts at such
Clearing Agency on the applicable Distribution Dates. Payments in respect of
the Common Securities shall be made in such manner as shall be mutually agreed
between the Property Trustee and the Common Securityholder. Any Distributions
in respect of Preferred Securities that remain unclaimed for a period of two
years following the applicable Distribution Date shall be paid to the Holder of
the Common Securities.
Section 5.5 Tax Returns and Reports.
The Regular Trustees shall prepare (or cause to be prepared), at
the Sponsor's expense, and file all United States federal, state and local tax
and information returns, payee statements and reports required to be filed by or
in respect of the Trust. In this regard, the Regular Trustees shall (a) prepare
and file (or cause to be prepared and filed) the appropriate
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Internal Revenue Service form required to be filed in respect of the Trust in
each taxable year of the Trust and (b) prepare and furnish (or cause to be
prepared and furnished) to each Securityholder the appropriate Internal Revenue
Service form required to be provided. The Regular Trustees shall provide the
Sponsor and the Property Trustee with a copy of all such returns and reports
promptly after such filing or furnishing. The Trustees and the Paying Agent
shall comply with United States federal withholding and backup withholding tax
laws and information reporting requirements with respect to any payments to
Securityholders under the Securities.
Section 5.6 Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Subordinated Debt Securities of Additional
Sums, the Property Trustee, pursuant to written instructions from the Sponsor
detailing the payments to be made, shall promptly pay at the expense of the
Sponsor any taxes, duties or governmental charges of whatsoever nature (other
than withholding taxes) imposed on the Trust by the United States or any other
taxing authority.
Section 5.7 Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred
Securities shall be reduced by the amount of any corresponding payment such
Holder has directly received pursuant to [Section 2.19] of the Officers'
Certificate establishing the Subordinated Debt Securities pursuant to Section
303 of the Indenture or Section 3.6(c) of this Declaration.
ARTICLE VI.
TRUST SECURITIES CERTIFICATES
Section 6.1 Initial Ownership.
Upon the formation of the Trust and until the issuance of the
Securities, and at any time during which no Securities are outstanding, the
Sponsor shall be the sole beneficial owner of the Trust.
Section 6.2 Certificates.
The Preferred Securities Certificates shall be issued in minimum
denominations of $___ Liquidation Amount and integral multiples of $___ in
excess thereof, and the Common Securities Certificates shall be issued in
minimum denominations of $___ Liquidation Amount and integral multiples thereof.
The Certificates shall be executed on behalf of the Trust by manual signature of
at least one Regular Trustee. Certificates bearing the manual signatures of
individuals who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be validly issued and entitled
to the benefits of this Declaration, notwithstanding that such individuals or
any of them shall have ceased to be so authorized prior to the delivery of such
Certificates or did not hold such offices at the date of delivery of such
Certificates. A transferee of a Certificate shall become a Securityholder, and
shall be entitled to the rights and subject to the obligations of a
Securityholder hereunder, upon due registration of such Certificate in such
transferee's name pursuant to Sections 6.4, 6.10 and 6.12.
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Section 6.3 Execution and Delivery of Certificates.
At the Closing Date the Regular Trustees shall cause Certificates
to be executed on behalf of the Trust and delivered by the Property Trustee as
provided in Sections 3.12 and 3.13.
Section 6.4 Registration and Transfer and Exchange of Preferred Securities
Certificates.
(a) The Sponsor shall keep or cause to be kept, at the office or
agency maintained pursuant to Section 6.7, a register or registers for the
purpose of registering Certificates and transfers and exchanges of Preferred
Securities Certificates (the "Securities Register") in which the registrar
designated by the Sponsor (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Preferred Securities Certificates and Common Securities Certificates (subject
to Section 6.9 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. The Bank shall be the initial Securities Registrar.
(b) Upon surrender for registration of transfer of any Preferred
Securities Certificate at the office or agency maintained pursuant to Section
6.7, the Regular Trustees or any one of them shall execute and deliver to the
Property Trustee, and the Property Trustee shall deliver, in the name of the
designated transferee or transferees, one or more new Preferred Securities
Certificates in authorized denominations of a like aggregate Liquidation Amount
dated the date of execution by such Regular Trustee or Trustees.
(c) The Securities Registrar shall not be required to register
the transfer of any Preferred Securities that have been called for redemption.
At the option of a Holder, Preferred Securities Certificates may be exchanged
for other Preferred Securities Certificates in authorized denominations of the
same class and of a like aggregate Liquidation Amount upon surrender of the
Preferred Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 6.7.
(d) Every Preferred Securities Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied by a
written instrument of transfer in form satisfactory to the Securities Registrar
duly executed by the Holder or his attorney duly authorized in writing. Each
Preferred Securities Certificate surrendered for registration of transfer or
exchange shall be canceled and subsequently disposed of by the Property Trustee
in accordance with such Person's customary practice. No service charge shall be
made for any registration of transfer or exchange of Preferred Securities
Certificates, but the Securities Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Preferred Securities Certificates.
Section 6.5 Mutilated, Destroyed, Lost or Stolen Trust Certificates.
If (a) any mutilated Certificate shall be surrendered to the
Securities Registrar, or if the Securities Registrar shall receive evidence to
its satisfaction of the destruction, loss or theft of any Certificate and (b)
there shall be delivered to the Securities Registrar and the Regular Trustees
such security or indemnity as may be required by them to save each of them
harmless,
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then in the absence of notice that such Certificate shall have been acquired by
a bona fide purchaser, the Regular Trustees, or any one of them, on behalf of
the Trust shall execute and make available for delivery, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like class, tenor and denomination. In connection with the
issuance of any new Certificate under this Section, the Regular Trustees or the
Securities Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection therewith.
Any duplicate Certificate issued pursuant to this Section shall constitute
conclusive evidence of an undivided beneficial interest in the assets of the
Trust, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 6.6 Persons Deemed Securityholders.
The Trustees or the Securities Registrar shall treat the Person
in whose name any Certificate shall be registered in the Securities Register as
the owner of such Certificate for the purpose of receiving Distributions and for
all other purposes whatsoever, and neither the Trustees nor the Securities
Registrar shall be bound by any notice to the contrary.
Section 6.7 Maintenance of Office or Agency.
The Property Trustee shall designate, with the consent of the
Regular Trustees (which consent shall not be unreasonably withheld), an office
or offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Certificates may be served.
The Property Trustee initially designates its Corporate Trust Office as its
office and agency for such purposes. The Property Trustee shall give prompt
written notice to the Sponsor and to the Securityholders of any change in the
location of the Securities Register or any such office or agency.
Section 6.8 Appointment of Paying Agent.
The Paying Agent shall make distributions to Securityholders from
the Payment Account and shall report the amounts of such distributions to the
Property Trustee and the Regular Trustees. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account for the purpose of
making the distributions referred to above. The Property Trustee may revoke such
power and remove the Paying Agent in its sole discretion. The Paying Agent shall
initially be the Bank, and any co-paying agent chosen by the Bank, and
reasonably acceptable to the Regular Trustees. Any Person acting as Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Regular Trustees and the Property Trustee. In the event that the Bank shall no
longer be the Paying Agent or a successor Paying Agent shall resign or its
authority to act be revoked, the Property Trustee shall appoint a successor that
is acceptable to the Regular Trustees to act as Paying Agent (which shall be a
bank or trust company). The Property Trustee shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Property Trustee to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trustees that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Securityholders in trust for the
benefit of the
34
Securityholders entitled thereto until such sums shall be paid to such
Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 3.6, 3.7 and 9.3 shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
Section 6.9 Ownership of Common Securities by Sponsor.
On the Closing Date the Sponsor shall acquire and retain
beneficial and record ownership of the Common Securities. To the fullest extent
permitted by law, other than a transfer in connection with a consolidation or
merger of the Sponsor into another corporation, or any conveyance, transfer or
lease by the Sponsor of its properties and assets substantially as an entirety
to any Person, pursuant to Section 801 of the Indenture, any attempted transfer
of the Common Securities shall be void. The Regular Trustees shall cause each
Common Securities Certificate issued to the Sponsor to contain a legend stating
"THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT IN CERTAIN LIMITED CIRCUMSTANCES
SET FORTH IN THE DE CLARATION (AS DEFINED BELOW)."
Section 6.10 Book-Entry Preferred Securities Certificates; Common Securities
Certificate.
(a) The Preferred Securities Certificates, upon original
issuance, will be issued in the form of a typewritten Preferred Securities
Certificate or Certificates representing Book-Entry Preferred Securities
Certificates, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Trust. Such Preferred Securities
Certificate or Certificates shall initially be registered on the Securities
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and no Owner will receive a Definitive Preferred Securities Certificate
representing such Owner's interest in such Preferred Securities, except as
provided in Section 6.12. Unless and until Definitive Preferred Securities
Certificates have been issued to Owners pursuant to Section 6.12:
(i) the provisions of this Section 6.10(a) shall be in full
force and effect;
(ii) the Securities Registrar, the Sponsor and the Trustees
shall be entitled to deal with the Clearing Agency for all purposes of this
Declaration relating to the Book-Entry Preferred Securities Certificates
(including the payment of the Liquidation Amount of and Distributions or
Redemption Price on the Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates and the giving of instructions or
directions to Owners of Preferred Securities evidenced by Book-Entry
Preferred Securities Certificates) as the sole Holder of Preferred
Securities evidenced by Book-Entry Preferred Securities Certificates and
shall have no obligations to the Owners thereof;
35
(iii) to the extent that the provisions of this Section 6.10
conflict with any other provisions of this Declaration, the provisions of
this Section 6.10 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing Agency
and shall be limited to those established by law and agreements between
such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Trust's agreement with the DTC, unless and
until Definitive Preferred Securities Certificates are issued pursuant to
Section 6.12, the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit payments on
the Preferred Securities to such Clearing Agency Participants.
(b) A single Common Securities Certificate representing the Common
Securities shall be issued to the Sponsor in the form of a definitive Common
Securities Certificate.
Section 6.11 Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Declaration, unless and until Definitive Preferred
Securities Certificates shall have been issued to Owners pursuant to Section
6.12, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
Section 6.12 Definitive Preferred Securities Certificates.
If (a) the Sponsor advises the Trustees in writing that the
Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Preferred Securities Certificates, and the
Sponsor is unable to locate a qualified successor, (b) the Sponsor at its option
advises the Trustees in writing that it elects to terminate the book-entry
system through the Clearing Agency or (c) after the occurrence of an Indenture
Event of Default, Owners of Preferred Securities Certificates representing
beneficial interests aggregating at least a majority of the aggregate
Liquidation Amount of the Outstanding Preferred Securities advise the Regular
Trustees in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interest of the Owners of Preferred
Securities Certificates, then the Regular Trustees shall notify the Clearing
Agency and the Clearing Agency shall notify all Owners of Preferred Securities
Certificates and the other Trustees of the occurrence of any such event and of
the availability of the Definitive Preferred Securities Certificates to Owners
of such class or classes, as applicable, requesting the same. Upon surrender to
the Regular Trustees or the Securities Registrar of the typewritten Preferred
Securities Certificate or Certificates representing the Book Entry Preferred
Securities Certificates by the Clearing Agency, accompanied by registration
instructions, the Regular Trustees, or any one of them, shall execute the
Definitive Preferred Securities Certificates in accordance with the instructions
of the Clearing Agency. Neither the Securities Registrar nor the Trustees shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Preferred Securities Certificates, the Trustees
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shall recognize the Holders of the Definitive Preferred Securities Certificates
as Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by the execution
thereof by the Regular Trustees or any one of them.
ARTICLE VII.
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
Section 7.1 Limitation on Voting Rights.
(a) Except as provided in this Section, in Sections 3.6, 9.7 and
11.2 and in the Indenture and as otherwise required by law, no Holder of
Preferred Securities shall have any right to vote or in any manner otherwise
control the administration, operation and management of the Trust or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Subordinated Debt Securities are held by the
Property Trustee, the Trustees shall not (i) direct the time, method and place
of conducting any proceeding for any remedy available to the Subordinated Debt
Securities Trustee, or executing any trust or power conferred on the Property
Trustee with respect to such Subordinated Debt Securities, (ii) waive any past
default which is waivable under Section 513 of the Indenture, (iii) exercise any
right to rescind or annul a declaration that the principal of all the
Subordinated Debt Securities shall be due and payable or (iv) consent to any
amendment, modification or termination of the Indenture or the Subordinated Debt
Securities, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a majority in aggregate
Liquidation Amount of all Outstanding Preferred Securities, provided, however,
that where a consent under the Indenture would require the consent of each
Holder of Subordinated Debt Securities affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Preferred Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of Preferred
Securities, except by a subsequent vote of the Holders of Preferred Securities.
The Property Trustee shall notify all Holders of the Preferred Securities of any
notice of default received from the Subordinated Debt Securities Trustee with
respect to the Subordinated Debt Securities. In addition to obtaining the
foregoing approvals of the Holders of the Preferred Securities, prior to taking
any of the foregoing actions, the Trustees shall, at the expense of the Sponsor,
obtain an Opinion of Counsel experienced in such matters to the effect that such
action shall not cause the Trust to fail to be classified as a grantor trust for
United States Federal income tax purposes.
(c) If any proposed amendment to this Declaration provides for, or
the Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to this Declaration or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Declaration, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a
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majority in aggregate Liquidation Amount of the Outstanding Preferred
Securities. Notwithstanding any other provision of this Declaration, no
amendment to this Declaration may be made if, as a result of such amendment, it
would cause the Trust to fail to be classified as a grantor trust for United
States Federal income tax purposes.
Section 7.2 Notice of Meetings.
Notice of all meetings of the Preferred Securityholders, stating
the time, place and purpose of the meeting, shall be given by the Property
Trustee pursuant to Section 11.8 to each Preferred Securityholder of record, at
his registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
Section 7.3 Meetings of Preferred Securityholders.
(a) No annual meeting of Securityholders is required to be held.
The Property Trustee, however, shall call a meeting of Preferred Securityholders
to vote on any matter upon the written request of the Preferred Securityholders
of record of 25% or more of the Preferred Securities (based upon their aggregate
Liquidation Amount) and the Regular Trustees or the Property Trustee may, at any
time in their discretion, call a meeting of Preferred Securityholders to vote on
any matters as to which Preferred Securityholders are entitled to vote.
(b) Preferred Securityholders of record of 50% of the Outstanding
Preferred Securities (based upon their aggregate Liquidation Amount), present in
person or by proxy, shall constitute a quorum at any meeting of Securityholders.
(c) If a quorum is present at a meeting, an affirmative vote by
the Preferred Securityholders of record present, in person or by proxy, holding
a majority of the Preferred Securities (based upon their aggregate Liquidation
Amount) held by the Preferred Securityholders of record present, either in
person or by proxy, at such meeting shall constitute the action of the Preferred
Securityholders, unless this Declaration requires a greater number of
affirmative votes.
Section 7.4 Voting Rights.
Securityholders shall be entitled to one vote for each $___ of
Liquidation Amount represented by their Securities in respect of any matter as
to which such Securityholders are entitled to vote.
Section 7.5 Proxies, Etc.
At any meeting of Securityholders, any Securityholder entitled to
vote thereat may vote by proxy, provided that no proxy shall be voted at any
meeting unless it shall have been placed on file with the Property Trustee, or
with such other officer or agent of the Trust as the Property Trustee may
direct, for verification prior to the time at which such vote shall be taken.
Pursuant to a resolution of the Property Trustee, proxies may be solicited in
the name of the Property Trustee or one or more officers of the Property
Trustee. Only Securityholders of
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record shall be entitled to vote. When Securities are held jointly by several
persons, any one of them may vote at any meeting in person or by proxy in
respect of such Securities, but if more than one of them shall be present at
such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Securities. A proxy purporting to be executed by or on behalf of
a Securityholder shall be deemed valid unless challenged at or prior to its
exercise, and the burden of proving invalidity shall rest on the challenger. No
proxy shall be valid more than three years after its date of execution.
Section 7.6 Securityholder Action by Written Consent.
Any action which may be taken by Securityholders at a meeting may
be taken without a meeting and without prior notice if Securityholders holding a
majority of all Outstanding Securities (based upon their Liquidation Amount)
entitled to vote in respect of such action (or such larger proportion thereof as
shall be required by any express provision of this Declaration) shall consent to
the action in writing.
Section 7.7 Record Date for Voting and Other Purposes.
For the purposes of determining the Securityholders who are
entitled to notice of and to vote at any meeting or to act by written consent,
or to participate in any distribution on the Securities in respect of which a
record date is not otherwise provided for in this Declaration, or for the
purpose of any other action, the Regular Trustees or the Property Trustee may
from time to time fix a date, not more than 90 days prior to the date of any
meeting of Securityholders or the payment of a distribution or other action, as
the case may be, as a record date for the determination of the identity of the
Securityholders of record for such purposes.
Section 7.8 Acts of Securityholders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Declaration to be
given, made or taken by Securityholders or Owners may be embodied in and
evidenced by one or more written instruments of substantially similar tenor
signed by such Securityholders or Owners in person or by an agent duly appointed
in writing; and, except as otherwise expressly provided herein, such action
shall become effective when such written instrument or instruments are delivered
to the Property Trustee. Such written instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Securityholders or Owners signing such written instrument or
instruments. Proof of execution of any such written instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Declaration and (subject to Section 8.1) conclusive in favor of the Trustees, if
made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
39
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which any Trustee receiving the same deems sufficient.
(c) The ownership of Preferred Securities shall be proved by the
Securities Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Securityholder of any Trust Security shall bind every
future Securityholder of the same Trust Security and the Securityholder of every
Trust Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
(e) Without limiting the foregoing, a Securityholder entitled
hereunder to take any action hereunder with regard to any particular Trust
Security may do so with regard to all or any part of the Liquidation Amount of
such Trust Security or by one or more duly appointed agents each of which may do
so pursuant to such appointment with regard to all or any part of such
liquidation amount.
(f) If any dispute arises between the Securityholders and the
Property Trustee or among such Securityholders or the Trustees with respect to
the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VII, then the determination of such matter by the
Property Trustee shall be conclusive and binding with respect to such matter.
Section 7.9 Inspection of Records.
Upon reasonable notice to the Regular Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VIII.
REPRESENTATIONS AND WARRANTIES
Section 8.1 Representations and Warranties of the Property Trustee.
The Property Trustee and the Delaware Trustee, each severally on
behalf of and as to itself, hereby represents and warrants for the benefit of
the Sponsor and the Securityholders that:
(a) the Property Trustee is a New York banking corporation validly
existing and in good standing under the laws of the State of New York;
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(b) the Property Trustee has the requisite power and authority to
execute, deliver and perform its obligations under this Declaration and has
taken all necessary action to authorize the execution, delivery and performance
by it of this Declaration;
(c) the Delaware Trustee is a Delaware banking corporation duly
organized, validly existing and in good standing in the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Declaration and has taken all necessary action to authorize the execution,
delivery and performance by it of this Declaration;
(e) this Declaration has been duly authorized, executed and
delivered by the Property Trustee and the Delaware Trustee and constitutes the
valid and legally binding agreement of each of the Property Trustee and the
Delaware Trustee enforceable against each of them in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and
(f) the execution, delivery and performance of this Declaration
has been duly authorized by all necessary corporate or other action on the part
of the Property Trustee and the Delaware Trustee and does not require any
approval of stockholders of the Property Trustee or the Delaware Trustee.
Section 8.2 Representations and Warranties of Sponsor.
The Sponsor hereby represents and warrants that:
(a) this Declaration has been duly authorized, executed and
delivered by the Sponsor and constitutes the valid and legally binding agreement
of the Sponsor enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles;
(b) the Certificates issued on the Closing Date on behalf of the
Trust have been duly authorized and will have been duly and validly executed,
issued and delivered by the Trustees pursuant to the terms and provisions of,
and in accordance with the requirements of, this Declaration and the
Securityholders will be, as of each such date, entitled to the benefits of this
Declaration; and
(c) there are no taxes, fees or other governmental charges payable
by the Trust (or the Trustees on behalf of the Trust) under the laws of the
State of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Declaration.
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ARTICLE IX.
OTHER PROVISIONS WITH RESPECT TO THE TRUSTEES
Section 9.1 Certain Notices.
Within ten Business Days after the receipt of notice of the
Sponsor's exercise of its right to defer the payment of interest on the
Subordinated Debt Securities pursuant to the Indenture, the Property Trustee
shall transmit, in the manner and to the extent provided in Section 11.8, notice
of such exercise to the Securityholders and the Regular Trustees, unless such
exercise shall have been revoked.
Section 9.2 May Hold Securities.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 9.5 and 9.10 and except as provided in the definition
of the term "Outstanding" in Article I, may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such other agent.
Section 9.3 Compensation; Indemnity; Fees.
(a) The Sponsor agrees:
(i) to pay to the Trustees from time to time such
compensation as shall be agreed to in writing between the Sponsor and
each Trustee for all services rendered by them hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(ii) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Declaration (including the
reasonable compensation and the expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or willful misconduct; and
(iii) to the fullest extent permitted by applicable law, to
indemnify and hold harmless (i) each Trustee, (ii) any Affiliate of any
Trustee, (iii) any officer, director, shareholder, employee,
representative or agent of any Trustee and (iv) any employee or agent of
the Trust or its Affiliates, (referred to herein as an "Indemnified
Person") from and against any loss, damage, liability, tax, penalty,
expense or claim of any kind or nature whatsoever incurred by such
Indemnified Person by reason of the creation, operation or termination
of the Trust or any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner
such Indemnified Person reasonably believed to be within the scope of
authority conferred on such Indemnified Person by this Declaration,
except that no Indemnified Person shall be entitled to be indemnified in
respect of any loss, damage or claim incurred by such
42
Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions.
(b) The provisions of this Section 9.3 shall survive the
termination of this Declaration or the resignation or removal of any Trustee.
(c) No Trustee may claim any lien or charge on any Trust Property
as a result of any amount due pursuant to this Section 9.3.
(d) The Sponsor and any Trustee (subject to Section 9.5) may
engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Trust, and the Trust and the Securityholders shall have no rights by
virtue of this Declaration in and to such independent ventures or the income or
profits derived therefrom, and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or
improper. Neither the Sponsor, nor any Trustee, shall be obligated to present
any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and the Sponsor or any Trustee shall have the right to take for its
own account (individually or as a partner or fiduciary) or to recommend to
others any such particular investment or other opportunity. Any Trustee may
engage or be interested in any financial or other transaction with the Sponsor
or any Affiliate of the Sponsor, or may act as depository for, trustee or agent
for, or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
Section 9.4 Corporate Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder. The
Property Trustee shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000. If any such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of its supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Property Trustee with respect to the Securities shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Regular Trustees
hereunder. Each Regular Trustee shall be a natural person at least 21 years of
age who is an officer of the Sponsor.
(c) There shall at all times be a Delaware Trustee. The Delaware
Trustee shall either be (i) a natural person who is at least 21 years of age and
a resident of the State of Delaware or (ii) a legal entity with its principal
place of business in the State of Delaware and that otherwise meets the
requirements of applicable Delaware law that shall act through one or more
persons authorized to bind such entity.
Section 9.5 Conflicting Interests.
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If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. The Indenture and the Guarantee are hereby excluded for purposes of
Section 310(b)(1) of the Trust Indenture Act.
Section 9.6 Co-Trustees and Separate Trustee.
(a) Unless an Event of Default shall have occurred and be
continuing, at any time or times, for the purpose of meeting the legal
requirements of the Trust Indenture Act or of any jurisdiction in which any part
of the Trust Property may at the time be located, the Sponsor and the Regular
Trustees, by agreed action of the majority of such Trustees, shall have power to
appoint, and upon the written request of the Regular Trustees, the Sponsor shall
for such purpose join with the Regular Trustees in the execution, delivery, and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as co-
trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section. If the Sponsor does not join in
such appointment within 15 days after the receipt by it of a request so to do,
or in case an Indenture Event of Default has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment. Any co-trustee
or separate trustee appointed pursuant to this Section shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States or (ii) a legal entity with its principal place of business in the United
States that shall act through one or more persons authorized to bind such
entity.
(b) Should any written instrument from the Sponsor be required by
any co-trustee or separate trustee so appointed for more fully confirming to
such co-trustee or separate trustee such property, title, right, or power, any
and all such instruments shall, on request, be executed, acknowledged and
delivered by the Sponsor.
(c) Every co-trustee or separate trustee shall, to the extent
permitted by law, but to such extent only, be appointed subject to the following
terms, namely:
(i) The Securities shall be executed and delivered and all
rights, powers, duties, and obligations hereunder in respect of the
custody of securities, cash and other personal property held by, or
required to be deposited or pledged with, the Trustees specified hereunder
shall be exercised solely by such Trustees and not by such co-trustee or
separate trustee.
(ii) The rights, powers, duties, and obligations hereby
conferred or imposed upon the Property Trustee in respect of any property
covered by such appointment shall be conferred or imposed upon and
exercised or performed by the Property Trustee or by the Property Trustee
and such co-trustee or separate trustee jointly, as shall be provided in
the instrument appointing such co-trustee or separate trustee, except to
the extent that under any law of any jurisdiction in which any particular
44
act is to be performed, the Property Trustee shall be incompetent or
unqualified to perform such act, in which event such rights, powers, duties
and obligations shall be exercised and performed by such co-trustee or
separate trustee.
(iii) The Property Trustee at any time, by an instrument in
writing executed by it, with the written concurrence of the Sponsor, may
accept the resignation of or remove any co-trustee or separate trustee
appointed under this Section, and, in case an Indenture Event of Default
has occurred and is continuing, the Property Trustee shall have power to
accept the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Sponsor. Upon the written request of
the Property Trustee, the Sponsor shall join with the Property Trustee in
the execution, delivery and performance of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A successor
to any co-trustee or separate trustee so resigned or removed may be
appointed in the manner provided in this Section.
(iv) No co-trustee or separate trustee hereunder shall be
personally liable by reason of any act or omission of the Property Trustee
or any other trustee hereunder.
(v) The Property Trustee shall not be liable by reason of
any act of a co-trustee or separate trustee.
(vi) Any Act of Holders delivered to the Property Trustee
shall be deemed to have been delivered to each such co-trustee and separate
trustee.
Section 9.7 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of any Trustee (the "Relevant
Trustee") and no appointment of a successor Trustee pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Trustee in accordance with the applicable requirements of Section 9.8.
(b) Subject to the immediately preceding paragraph, the Relevant
Trustee may resign at any time by giving written notice thereof to the
Securityholders and the other Trustees. If the instrument of acceptance by the
successor Trustee required by Section 9.8 shall not have been delivered to the
Relevant Trustee within 30 days after the giving of such notice of resignation,
the Relevant Trustee may petition, at the expense of the Sponsor, any court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
(c) Unless an Indenture Event of Default shall have occurred and
be continuing, any Trustee may be removed at any time by Act of the Common
Securityholder. If an Indenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in aggregate
Liquidation Amount of the Outstanding Preferred Securities, delivered to the
Relevant Trustee (in its individual capacity and on behalf of the Trust). A
Regular Trustee may be removed by the Common Securityholder at any time.
45
(d) If any Trustee shall resign, be removed or become incapable of
acting as Trustee, or if a vacancy shall occur in the office of any Trustee for
any cause, at a time when no Indenture Event of Default shall have occurred and
be continuing, the Common Securityholder, by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees, which successor Trustee shall be domiciled outside of the State of
California, and the retiring Trustee shall comply with the applicable
requirements of Section 9.8. If the Property Trustee or the Delaware Trustee
shall resign, be removed or become incapable of continuing to act as the
Property Trustee or the Delaware Trustee, as the case may be, at a time when an
Indenture Event of Default shall have occurred and be continuing, the Preferred
Securityholders, by Act of the Securityholders of a majority in aggregate
Liquidation Amount of the Preferred Securities then Outstanding delivered to the
retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee
or Trustees, and such successor Trustee shall comply with the applicable
requirements of Section 9.8. If a Regular Trustee shall resign, be removed or
become incapable of acting as Regular Trustee, at a time when an Indenture Event
of Default shall have occurred and be continuing, the Common Securityholder by
Act of the Common Securityholder delivered to the Regular Trustee shall promptly
appoint a successor Regular Trustee and such successor Regular Trustee shall
comply with the applicable requirements of Section 9.8. If no successor Relevant
Trustee shall have been so appointed by the Common Securityholder or the
Preferred Securityholders and accepted appointment in the manner required by
Section 9.8, any Securityholder who has been a Securityholder of Securities for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Relevant Trustee.
(e) The Property Trustee shall, at the expense of the Sponsor,
give notice of each resignation and each removal of a Trustee and each
appointment of a successor Trustee to all Securityholders in the manner provided
in Section 11.8 and shall give notice to the Sponsor. Each notice shall include
the name of the successor Relevant Trustee and the address of its Corporate
Trust Office if it is the Property Trustee.
(f) Notwithstanding the foregoing or any other provision of this
Declaration, in the event any Regular Trustee or a Delaware Trustee who is a
natural person dies or becomes, in the opinion of the Sponsor, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by (a) the unanimous act of the remaining Regular Trustees if there
are at least two of them or (b) otherwise by the Sponsor (with the successor in
each case being a Person who satisfies the eligibility requirement for Regular
Trustee or Delaware Trustee, as the case may be, set forth in Section 9.4).
Section 9.8 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Relevant
Trustee, the retiring Relevant Trustee and each successor Relevant Trustee with
respect to the Securities shall execute and deliver an amendment hereto wherein
each successor Relevant Trustee shall accept such appointment and which (a)
shall contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Securities and the Trust and (b) shall add to or change any of the provisions of
this Declaration as shall be necessary to provide for or facilitate the
administration of the Trust by more than one Relevant Trustee, it
46
being understood that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees and upon the execution and delivery of such
amendment the resignation or removal of the retiring Relevant Trustee shall
become effective to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Relevant Trustee; but,
on request of the Trust or any successor Relevant Trustee such retiring Relevant
Trustee shall duly assign, transfer and deliver to such successor Relevant
Trustee all Trust Property, all proceeds thereof and money held by such retiring
Relevant Trustee hereunder with respect to the Securities and the Trust.
(b) Upon request of any such successor Relevant Trustee, the
Trust shall execute any and all instruments for more fully and certainly vesting
in and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
(c) No successor Relevant Trustee shall accept its appointment
unless at the time of such acceptance such successor Relevant Trustee shall be
qualified and eligible under this Article.
Section 9.9 Merger, Conversion Consolidation or Succession to Business.
Any corporation into which the Property Trustee or the Delaware
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which such
Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of such Trustee, shall be the successor of such
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
Section 9.10 Preferential Collection of Claims against Sponsor or Trust.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Securities or the property of the Trust or of such other obligor or
their creditors, the Property Trustee (irrespective of whether any Distributions
on the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Property Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel) and of the Holders allowed in such judicial proceeding, and
47
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Property Trustee and, in the event the Property Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Property Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Property Trustee, its agents and counsel, and
any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement adjustment or compensation affecting the Securities
or the rights of any Holder thereof or to authorize the Property Trustee to vote
in respect of the claim of any Holder in any such proceeding.
Section 9.11 Number of Trustees.
(a) The number of Trustees shall initially be five, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Regular Trustees. The Property Trustee and the Delaware
Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and, if such
Trustee is a Regular Trustee, the number of Regular Trustees is not reduced
pursuant to Section 9.11(a), or if the number of Trustees is increased pursuant
to Section 9.11(a), a vacancy shall occur. The vacancy shall be filled with a
Trustee appointed in accordance with Section 9.7.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul, dissolve or terminate the Trust. Whenever a vacancy in the number of
Regular Trustees shall occur, until such vacancy is filled by the appointment of
a Regular Trustee or Regular Trustees in accordance with Section 9.7, the
Regular Trustees in office, regardless of their number (and notwithstanding any
other provision of this Agreement), shall have all the powers granted to the
Regular Trustees and shall discharge all the duties imposed upon the Regular
Trustees by this Declaration.
Section 9.12 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of executing any documents contemplated in Section
3.5; and
(b) The Regular Trustees shall have power to delegate from time to
time to such of their number or to the Sponsor the doing of such things and the
execution of such instruments either in the name of the Trust or the names of
the Regular Trustees or otherwise as the Regular Trustees may deem expedient, to
the extent such delegation is not prohibited by applicable law or contrary to
the provisions of this Declaration, as set forth herein.
Section 9.13 Delaware Trustee.
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It is expressly understood and agreed by the parties hereto that, in
fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust,
(i) any agreements or instruments executed and delivered by The Bank of New York
(Delaware) are executed and delivered not in its individual capacity but solely
as Delaware Trustee under this Declaration in exercise of the powers and
authority conferred and vested in it, (ii) each of the representations,
undertakings and agreements herein made by The Bank of New York (Delaware) on
the part of the Trust is made and intended not as representations, warranties,
covenants, undertakings and agreements by The Bank of New York (Delaware) in its
individual capacity but is made and intended for the purpose of binding only the
Trust, and (iii) under no circumstances shall The Bank of New York (Delaware) in
its individual capacity be personally liable for the payment of any indebtedness
or expenses of the Trust or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the Trust
under this Declaration, except if such breach or failure is due to any
negligence or willful misconduct of the Delaware Trustee.
ARTICLE X.
TERMINATION, LIQUIDATION AND MERGER
Section 10.1 Termination upon Expiration Date.
Unless earlier dissolved, the Trust shall automatically dissolve
on __________ (the "Expiration Date"), and the Trust Property shall be
distributed in accordance with Section 10.4.
Section 10.2 Early Termination.
The first to occur of any of the following events is an "Early
Termination Event," upon the occurrence of which the Trust shall be dissolved:
(a) a Bankruptcy Event in respect of, or the dissolution or
liquidation of, the Sponsor;
(b) the filing of a certificate of dissolution or its equivalent
with respect to the Sponsor;
(c) the date that is 90 days after the revocation of the articles
of incorporation of the Sponsor (but only if the articles of incorporation are
not reinstated during such 90-day period);
(d) the written direction to the Property Trustee from the
Sponsor at any time to dissolve the Trust and distribute Subordinated Debt
Securities to Securityholders in exchange for the Preferred Securities (which
direction is optional and wholly within the discretion of the Sponsor);
(e) the redemption of all of the Preferred Securities in
connection with the redemption of all the Subordinated Debt Securities; and
49
(f) the entry of an order for dissolution of the Trust by a court
of competent jurisdiction.
Section 10.3 Termination.
The respective obligations and responsibilities of the Trustees
and the Trust created and continued hereby shall terminate upon the latest to
occur of the following: (a) the distribution by the Property Trustee to
Securityholders upon the liquidation of the Trust pursuant to Section 10.4, or
upon the redemption of all of the Securities pursuant to Section 5.2, of all
amounts required to be distributed hereunder upon the final payment of the
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Regular Trustees, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders.
Section 10.4 Liquidation.
(a) If an Early Termination Event specified in clause (a), (b) or
(d) of Section 10.2 occurs or upon the Expiration Date, the Trust shall be
liquidated by the Trustees as expeditiously as the Trustees determine to be
possible by distributing, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, to each Securityholder a Like Amount of
Subordinated Debt Securities, subject to Section 10.4(d). Notice of liquidation
shall be given by the Property Trustee at the expense of the Sponsor by first-
class mail, postage prepaid mailed not later than 30 nor more than 60 days prior
to the Liquidation Date to each Securityholder at such Holder's address
appearing in the Securities Register. All notices of liquidation shall :
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the
Securities will no longer be deemed to be Outstanding and any Certificates
not surrendered for exchange will be deemed to represent a Like Amount of
Subordinated Debt Securities; and
(iii) provide such information with respect to the mechanics
by which Holders may exchange Certificates for Subordinated Debt
Securities, or if Section 10.4(d) applies, receive a Liquidation
Distribution.
(b) Except where Section 10.2(c) or 10.4(d) applies, in order to
effect the liquidation of the Trust and distribution of the Subordinated Debt
Securities to Securityholders, the Property Trustee shall establish a record
date for such distribution (which shall be (i) one Business Day prior to the
Liquidation Date or (ii) in the event that the Preferred Securities are not in
book-entry form, the date 15 days prior to the Liquidation Date) and, either
itself acting as exchange agent or through the appointment of a separate
exchange agent, shall establish such procedures as it shall deem appropriate to
effect the distribution of Subordinated Debt Securities in exchange for the
Outstanding Certificates.
(c) Except where Section 10.2(c) or 10.4(d) applies, after the
Liquidation Date, (i) the Securities will no longer be deemed to be Outstanding,
(ii) certificates representing a Like Amount of Subordinated Debt Securities
will be issued to holders of Certificates, upon
50
surrender of such certificates to the Property Trustee or its agent for
exchange, (iii) the Sponsor shall use its best efforts to have the Subordinated
Debt Securities listed on the New York Stock Exchange or on such other exchange,
interdealer quotation system or self-regulatory organization as the Preferred
Securities are then listed, (iv) any Certificates not so surrendered for
exchange will be deemed to represent a Like Amount of Subordinated Debt
Securities, accruing interest at the rate provided for in the Subordinated Debt
Securities from the last Distribution Date on which a Distribution was made on
such Certificates until such certificates are so surrendered (and until such
certificates are so surrendered, no payments of interest or principal will be
made to Holders of Certificates with respect to such Subordinated Debt
Securities) and (v) all rights of Securityholders holding Securities will cease,
except the right of such Securityholders to receive Subordinated Debt Securities
upon surrender of Certificates.
(d) In the event that, notwithstanding the other provisions of
this Section 10.4, whether because of an order for dissolution entered by a
court of competent jurisdiction or otherwise, distribution of the Subordinated
Debt Securities in the manner provided herein is determined by the Property
Trustee not to be practical, the Trust Property shall be liquidated, and the
Trust shall be wound-up by the Property Trustee in such manner as the Property
Trustee determines. In such event, Securityholders will be entitled to receive
out of the assets of the Trust available for distribution to Securityholders,
after satisfaction of liabilities to creditors of the Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such winding up, the
Liquidation Distribution can be paid only in part because the Trust has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then, subject to the next succeeding sentence, the amounts payable
by the Trust on the Securities shall be paid on a pro rata basis (based upon
Liquidation Amounts). The Holder of the Common Securities will be entitled to
receive Liquidation Distributions upon any such winding-up pro rata (determined
as aforesaid) with Holders of Preferred Securities, except that, if an Indenture
Event of Default has occurred and is continuing, the Preferred Securities shall
have a priority over the Common Securities.
Section 10.5 Mergers, Consolidations, Amalgamations or Replacements of Trust.
The Trust may not merge with or into, consolidate, amalgamate, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, except pursuant to this Section 10.5
or Section 10.4. At the request of the Sponsor, with the consent of the Holders
of at least a majority in aggregate Liquidation Amount of the Outstanding
Preferred Securities, the Trust may merge with or into, consolidate, amalgamate,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the laws of any
State; provided, that:
(i) such successor entity either (x) expressly assumes all of
the obligations of the Trust with respect to the Preferred Securities or
(y) substitutes for the Preferred Securities other securities having
substantially the same terms as the Preferred Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to distributions and
payments upon liquidation, redemption and otherwise;
51
(ii) the Sponsor expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee as the
holder of the Subordinated Debt Securities;
(iii) the Preferred Securities are listed or traded, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which the Preferred
Securities are then listed or traded, if any;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Preferred Securities
(including any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the Preferred Securities
(including any Successor Securities) in any material respect;
(vi) such successor entity has a purpose substantially
identical to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
Opinion of Counsel to the effect that (x) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (y) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor such
successor entity will be required to register as an investment company
under the 1940 Act; and
(viii) the Sponsor owns all of the common securities of such
successor entity and the Guarantor guarantees the obligations of such
successor entity under the Successor Securities at least to the extent
provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in Liquidation Amount of the Preferred Securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets substantially as an entirety to any other entity or
permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or the successor entity to be classified
as other than a grantor trust for United States Federal income tax purposes.
ARTICLE XI.
MISCELLANEOUS PROVISIONS
Section 11.1 Limitation of Rights of Securityholders.
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Except as otherwise provided in Section 10.2, the death,
dissolution, termination, bankruptcy or incapacity of any Person having an
interest, beneficial or otherwise, in Securities shall not operate to terminate
this Declaration, nor dissolve, terminate or annul the Trust, nor entitle the
legal successors, representatives or heirs of such Person or any Securityholder
for such Person, to claim an accounting, take any action or bring any proceeding
in any court for a partition or winding up of the arrangements contemplated
hereby, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Section 11.2 Amendment.
(a) This Declaration may be amended from time to time by the
Property Trustee, the Regular Trustees and the Sponsor, without the consent of
any Securityholders, (i) to cure any ambiguity, correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Declaration, which shall not be inconsistent with the other provisions of
this Declaration, or (ii) to modify, eliminate or add to any provisions of this
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States Federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an investment company under the 1940 Act;
provided, however, that in the case of clause (i), such action shall not
adversely affect in any material respect the interests of any Securityholder,
and any such amendments of this Declaration shall become effective when notice
thereof is given to the Securityholders.
(b) Except as provided in Section 11.2(c) hereof, any provision
of this Declaration may be amended by the Trustees and the Sponsor with (i) the
consent of Securityholders representing a majority (based upon aggregate
Liquidation Amount) of the Securities then Outstanding and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States Federal
income tax purposes or the Trust's exemption from status of an investment
company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in
this Declaration, without the consent of each affected Securityholder, this
Declaration may not be amended to (i) change the amount or timing of any
Distribution on the Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Securities as of a specified
date or (ii) restrict the right of a Securityholder to institute suit for the
enforcement of any such payment on or after such date; notwithstanding any other
provision herein, without the unanimous consent of the Securityholders, this
paragraph (c) of this Section 11.2 may not be amended.
(d) Notwithstanding any other provisions of this Declaration, no
Trustee shall enter into or consent to any amendment to this Declaration which
would cause the Trust to fail or cease to qualify for the exemption from status
of an investment company under the 1940 Act or fail or cease to be classified as
a grantor trust for United States Federal income tax purposes.
53
(e) Notwithstanding anything in this Declaration to the
contrary, this Declaration may not be amended in a manner which imposes any
additional obligation on the Sponsor, the Property Trustee or the Delaware
Trustee without the consent of the Sponsor, the Property Trustee or the Delaware
Trustee, as the case may be.
(f) In the event that any amendment to this Declaration is made,
the Regular Trustees shall promptly provide to the Sponsor a copy of such
amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall
be required to enter into any amendment to this Declaration which affects its
own rights, duties or immunities under this Declaration. The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officer's Certificate
stating that any amendment to this Declaration is in compliance with this
Declaration and that all conditions precedent, if any, to such amendment have
been complied with.
Section 11.3 Separability.
In case any provision in this Declaration or in the Certificates
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 11.4 Governing Law.
THIS DECLARATION AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS DECLARATION AND
THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES
THEREOF.
Section 11.5 Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be
a day that is not a Business Day, then such payment need not be made on such
date but may be made on the next succeeding day that is a Business Day (except
as otherwise provided in Sections 5.1(a) and 5.2(d)), with the same force and
effect as though made on the date fixed for such payment, and no interest shall
accrue thereon for the period after such date.
Section 11.6 Successors.
This Declaration shall be binding upon and shall inure to the
benefit of any successor to the Sponsor, the Trust or the Relevant Trustee,
including any successor by operation of law. Except in connection with a
consolidation, merger, sale or other transaction involving the Sponsor that is
permitted under Article Eight of the Indenture and pursuant to which the
assignee agrees in writing to perform the Sponsor's obligations hereunder, the
Sponsor shall not assign its obligations hereunder.
Section 11.7 Headings.
54
The Article and Section headings are for convenience only and
shall not affect the construction of this Declaration.
Section 11.8 Reports, Notices and Demands
(a) Any report, notice, demand or other communication which by
any provision of this Declaration is required or permitted to be given or served
to or upon any Securityholder or the Sponsor may be given or served in writing
by deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Sponsor, to Sempra Energy, 101
Ash Street, San Diego, California 92101, Attention __________, facsimile number
(619) _____________. Any notice to Preferred Securityholders shall also be given
to such owners as have, within two years preceding the giving of such notice,
filed their names and addresses with the Property Trustee for that purpose. Such
notice, demand or other communication to or upon a Securityholder shall be
deemed to have been sufficiently given or made, for all purposes, upon hand
delivery, mailing or transmission.
(b) Any notice, demand or other communication which by any
provision of this Declaration is required or permitted to be given or served to
or upon the Trust, the Property Trustee, the Delaware Trustee or the Regular
Trustees shall be given in writing addressed (until another address is published
by the Trust) as follows: (a) with respect to the Property Trustee to The Bank
of New York, at its Corporate Trust Office, Attention: Corporate Trust
Administration; (b) with respect to the Delaware Trustee, to The Bank of New
York (Delaware), White Clay Center, Route 273, Newark, Delaware 19711,
Attention: Corporate Trust Administration; (c) with respect to the Regular
Trustees, to them c/o Sempra Energy, 101 Ash Street, San Diego, California
92101, marked "Attention Regular Trustees of Sempra Energy Capital Trust I"; and
(d) with respect to the Trust, to its principal office specified in Section 3.2,
with a copy to the Property Trustee. Such notice, demand or other communication
to or upon the Trust or the Property Trustee shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the Trust
or the Property Trustee.
Section 11.9 Agreement not to Petition.
Each of the Trustees and the Sponsor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article X, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Sponsor takes action in violation of this Section 11.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Sponsor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Sponsor against the Trust or
the commencement of such action and raise the defense that the Sponsor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses,
55
if any, as counsel for the Trustee or the Trust may assert. The provisions of
this Section 11.9 shall survive the termination of this Declaration.
Section 11.10 Acceptance of Terms of Declaration; Guarantee and Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST
THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS DECLARATION AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS DECLARATION
SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH
SECURITYHOLDER AND SUCH OTHERS. THE DEPOSITOR, THE TRUST AND EACH HOLDER AND
BENEFICIAL OWNER OF A PREFERRED SECURITY (BY ITS ACCEPTANCE OF AN INTEREST
THEREIN) SHALL BE DEEMED TO HAVE AGREED TO TREAT THE NOTES AS INDEBTEDNESS FOR
ALL U.S. TAX PURPOSES AND THE PREFERRED SECURITY AS EVIDENCE OF AN INDIRECT
BENEFICIAL OWNERSHIP INTEREST IN THE NOTES.
(Signature Pages Follow)
56
IN WITNESS WHEREOF, the parties hereto have caused this Declaration to
be duly executed, as of the day and year first written above.
SEMPRA ENERGY
By:
__________________________________________
Name:
Title:
THE BANK OF NEW YORK, as Property Trustee
By:
__________________________________________
Name
Title:
THE BANK OF NEW YORK (DELAWARE),
as Delaware
Trustee
By:
__________________________________________
Name
Title:
S-1
REGULAR TRUSTEES
By:_______________________________________
Name:
Title:
By:_______________________________________
Name:
Title:
By:_______________________________________
Name:
Title:
S-2
Exhibit 5.2
[Letterhead of Richards, Layton & Finger, P.A.]
September 28, 2001
Sempra Energy Capital Trust II
c/o Sempra Energy
101 Ash Street
San Diego, California 92101
Re: Sempra Energy Capital Trust II
------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Sempra Energy, a
California corporation (the "Company"), and Sempra Energy Capital Trust II, a
Delaware business trust (the "Trust"), in connection with the matters set forth
herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated April 22, 1999 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on April 22, 1999;
(b) The Declaration of Trust of the Trust, dated as of April 22,
1999, among the Company and the trustees of the Trust named therein;
(c) A form of Amended and Restated Declaration of Trust of the Trust
(including Exhibit A and Annexes I and II)(the "Declaration"), to be entered
into among the Company, as sponsor, the trustees of the Trust named therein, and
the holders, from time to time, of undivided beneficial interests in the assets
of the Trust, attached as an exhibit to the Registration Statement (as defined
below);
Sempra Energy Capital Trust II
September 28, 2001
Page 2
(d) The Registration Statement on Form S-3 (the "Registration
Statement"), including a prospectus (the "Prospectus"), relating to the
Preferred Securities of the Trust representing undivided beneficial interests in
the assets of the Trust (each, a "Preferred Security" and collectively, the
"Preferred Securities"), as proposed to be filed by the Company, the Trust and
others with the Securities and Exchange Commission on or about September 28,
2001; and
(e) A Certificate of Good Standing for the Trust, dated September 27,
2000, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (e) above. In particular,
we have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our
own but rather have relied solely upon the foregoing documents, the statements
and information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
and the Certificate are in full force and effect and have not been amended, (ii)
except to the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, organization or formation, (iii) the legal
capacity of natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to whom
a Preferred Security is to be issued by the Trust (collectively, the "Preferred
Security Holders") of a preferred security certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Declaration and the Registration Statement, and (vii) that
the Preferred Securities are issued and sold to the Preferred Security Holders
in accordance with the Declaration
Sempra Energy Capital Trust II
September 28, 2001
Page 3
and the Registration Statement. We have not participated in the preparation of
the Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Declaration.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In addition,
we hereby consent to the use of our name under the heading "Validity of the
Securities and the Guarantees" in the Prospectus. In giving the foregoing
consents, we do not thereby admit that we come within the category of Persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the Securities and Exchange Commission
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
BJK/GWN
Exhibit 5.3
[Letterhead of Richards, Layton & Finger, P.A.]
September 28, 2001
Sempra Energy Capital Trust III
c/o Sempra Energy
101 Ash Street
San Diego, California 92101
Re: Sempra Energy Capital Trust III
-------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Sempra Energy, a
California corporation (the "Company"), and Sempra Energy Capital Trust III, a
Delaware business trust (the "Trust"), in connection with the matters set forth
herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated April 22, 1999 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on April 22, 1999;
(b) The Declaration of Trust of the Trust, dated as of April 22,
1999, among the Company and the trustees of the Trust named therein;
(c) A form of Amended and Restated Declaration of Trust of the Trust
(including Exhibit A and Annexes I and II)(the "Declaration"), to be entered
into among the Company, as sponsor, the trustees of the Trust named therein, and
the holders, from time to time, of undivided beneficial interests in the assets
of the Trust, attached as an exhibit to the Registration Statement (as defined
below);
Sempra Energy Capital Trust III
September 28, 2001
Page 2
(d) The Registration Statement on Form S-3 (the "Registration
Statement"), including a prospectus (the "Prospectus"), relating to the
Preferred Securities of the Trust representing undivided beneficial interests in
the assets of the Trust (each, a "Preferred Security" and collectively, the
"Preferred Securities"), as proposed to be filed by the Company, the Trust and
others with the Securities and Exchange Commission on or about September 28,
2001; and
(e) A Certificate of Good Standing for the Trust, dated September 27,
2001, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (e) above. In particular,
we have not reviewed any document (other than the documents listed in paragraphs
(a) through (e) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our
own but rather have relied solely upon the foregoing documents, the statements
and information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
and the Certificate are in full force and effect and have not been amended, (ii)
except to the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, organization or formation, (iii) the legal
capacity of natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to whom
a Preferred Security is to be issued by the Trust (collectively, the "Preferred
Security Holders") of a preferred security certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Declaration and the Registration Statement, and (vii) that
the Preferred Securities are issued and sold to the Preferred Security Holders
in accordance with the Declaration
Sempra Energy Capital Trust III
September 28, 2001
Page 3
and the Registration Statement. We have not participated in the preparation of
the Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Business Trust Act.
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Securities
Holders may be obligated to make payments as set forth in the Declaration.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In addition,
we hereby consent to the use of our name under the heading "Validity of the
Securities and the Guarantees" in the Prospectus. In giving the foregoing
consents, we do not thereby admit that we come within the category of Persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the Securities and Exchange Commission
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
BJK/GWN
EXHIBIT 12.1
SEMPRA ENERGY
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
(Dollars in millions)
For the six
months ended
June 30,
1996 1997 1998 1999 2000 2000 2001
-------- -------- --------- -------- -------- -------- -------
Fixed Charges and Preferred
Stock Dividends:
Interest $ 205 $ 209 $ 210 $ 233 $ 305 $ 165 $ 193
Interest Portion of Annual Rentals 28 25 20 10 8 5 4
Preferred dividends of subsidiaries (1) 37 31 18 16 18 9 10
----- ----- ----- ----- ----- ----- -----
Total Fixed Charges and Preferred Stock
Dividends For Purpose of Ratio $ 270 $ 265 $ 248 $ 259 $ 331 $ 179 $ 207
===== ===== ===== ===== ===== ===== =====
Earnings:
Pretax income from continuing operations $ 727 $ 733 $ 432 $ 573 $ 699 $ 340 $ 511
Add:
Fixed charges (from above) 270 265 248 259 331 179 207
Less: Fixed charges capitalized 5 3 3 5 5 2 4
Equity income (loss) of
unconsolidated subsidiaries and
joint ventures -- -- -- -- 62 22 (3)
----- ----- ----- ----- ----- ----- -----
Fixed charges net of capitalized charges 265 262 245 254 264 155 206
----- ----- ----- ----- ----- ----- -----
Total Earnings for Purpose of Ratio $ 992 $ 995 $ 677 $ 827 $ 963 $ 495 $ 717
===== ===== ===== ===== ===== ===== =====
Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends 3.67 3.75 2.73 3.19 2.91 2.77 3.46
===== ===== ===== ===== ===== ===== =====
(1) In computing this ratio, "Preferred dividends of subsidiaries"
represents the before-tax earnings necessary to pay such dividends, computed at
the effective tax rates for the applicable periods.
EXHIBIT 23.3
Independent Auditors' Consent
We consent to the incorporation by reference in this Registration Statement of
Sempra Energy on Form S-3 of our reports dated January 26, 2001 (February 27,
2001 as to Notes 3, 4, 5, and 14) and March 9, 2001, incorporated by reference
and appearing in the Annual Report on Form 10-K of Sempra Energy for the year
ended December 31, 2000 and to the reference to us under the heading "Experts"
in the Prospectus, which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
San Diego, California
September 28, 2001
Exhibit 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
___________________
FORM T-1
Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of a Corporation
Designated to Act as Trustee
___________________
U.S. Bank Trust National Association
(Exact name of trustee as specified in its charter)
United States 94-3160100
(State of Incorporation) (IRS Employer Identification No.)
550 South Hope Street, Suite 500
Los Angeles, California 90071
(Address of principal executive offices and zip code)
___________________
SEMPRA ENERGY
(Exact name of obligor as specified in its charter)
California
(State or other jurisdiction of Incorporation or organization)
33-0732627
(IRS Employer Identification No.)
101 Ash Street
San Diego, CA 92101
(Address of principal executive offices and Zip code)
John R. Light, Esq.
Executive Vice President and General Counsel
101 Ash Street
San Diego, CA 92101
(619) 696-2034
(Names, addresses and telephone numbers of agents for service)
Senior Debt Securities
(Title of the indenture securities)
GENERAL
1. GENERAL INFORMATION Furnish the following information as to the trustee.
-------------------
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency
Washington DC
(b) Whether it is authorized to exercise corporate trust powers.
Yes
2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS If the obligor or any
------------------------------------------
underwriter for the obligor is an affiliate of the trustee, describe each
such affiliation.
None
See Note following Item 16.
Items 3-15 are not applicable because to the best of the Trustee's
------------------------------------------------------------------
knowledge the obligor is not in default under any Indenture for which the
-------------------------------------------------------------------------
Trustee acts as Trustee.
-----------------------
16. LIST OF EXHIBITS List below all exhibits filed as a part of this statement
----------------
of eligibility and qualification.
Exhibit 1 -Articles of Association of U.S. Bank Trust National Association
dated June 5, 1992. Incorporated herein by reference to Exhibit 1
filed with Form T-1 statement, Registration No. 33-50826
Exhibit 2 -Certificate of the Comptroller of Currency as to authority of
U.S. Bank Trust National Association to commence the business of
banking. Incorporated herein by reference to Exhibit 2 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 3 -Authorization of the Comptroller of Currency granting U.S. Bank
Trust National Association the right to exercise corporate trust
powers. Incorporated herein by reference to Exhibit 3 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 4 -By-Laws of U.S. Bank Trust National Association, dated June 15,
1992. Incorporated herein by reference to Exhibit 4 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 5 - Not Applicable
Exhibit 6 -Consent of U.S. Bank Trust National Association required by
Section 321(b) of the Act. Incorporated herein by reference to Exhibit
6 filed with Form T-1 Statement, Registration No.33-50826
Exhibit 7 -Report of Condition of U.S. Bank Trust National Association,
as of the close of business on June 30, 2001 published pursuant to law
or the requirements of its supervising or examining authority.
NOTE
The answers to this statement insofar as such answers relate to what persons
have been underwriters for any securities of the obligor within three years
prior to the date of filing this statement, or what persons are owners of 10% or
more of the voting securities of the obligor, or affiliates, are based upon
information furnished to the trustee by the obligor. While the trustee has no
reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
U.S. Bank Trust National Association, an Association organized and existing
under the laws of the United States, has duly caused this statement of
eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereunto affixed and attested, all
in the City of Los Angeles and State of California on the 26th day of September
2001.
U.S. BANK TRUST NATIONAL ASSOCIATION
By: /s/ Tamara Mawn
----------------------------------
Tamara Mawn
Vice President
Attest: /s/ Gonzalo Urey
----------------
Gonzalo Urey
Assistant Vice President
EXHIBIT 6
C O N S E N T
In accordance with Section 321(b) of the Trust Indenture Act of 1939, the
undersigned, U.S. Bank Trust National Association, hereby consents that reports
of examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.
Dated: September 26, 2001
U.S. BANK TRUST NATIONAL ASSOCIATION
By: /s/ Tamara Mawn
---------------
Tamara Mawn
Vice President
U.S. Bank Trust National Association
Statement of Financial Condition
As of 06/30/01
($000's)
Assets:
Cash and Balances Due From Depository Institutions: 86,736
Federal Reserve Stock: 1,270
Fixed Assets: 737
Intangible Assets: 51,868
Other Assets: 12,846
-------
Total Assets: 153,457
-------
Liabilities:
Other Liabilities: 6,734
-------
Total Liabilities: 6,734
-------
Equity:
Common and Preferred Stock: 1,000
Surplus: 126,260
Undivided Profits and Capital Reserve: 19,463
Net unrealized holding gains (losses) on available-for-sale securities 0
-------
Total Equity Capital: 146,723
-------
Total Liabilities and Equity Capital: 153,457
-------
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
U.S. Bank Trust National Association
By: /s/ Tamara Mawn
-----------------
Vice President
Exhibit 25.2
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [_]
__________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
__________
Sempra Energy
(Exact name of obligor as specified in its charter)
California 33-0732627
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
__________
Debt Securities
(Title of the indenture securities)
========================================================================
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
----------------------------------------------------------------------------------
Name Address
----------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
------------------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
-3-
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.......................... $ 2,811,275
Interest-bearing balances................................................... 3,133,222
Securities:
Held-to-maturity securities................................................. 147,185
Available-for-sale securities............................................... 5,403,923
Federal funds sold and Securities purchased under agreements to resell....... 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale.............................................. 74,702
Loans and leases, net of unearned income.................................... 37,471,621
LESS: Allowance for loan and lease losses................................... 599,061
Loans and leases, net of unearned income and allowance...................... 36,872,560
Trading Assets............................................................... 11,757,036
Premises and fixed assets (including capitalized leases)..................... 768,795
Other real estate owned...................................................... 1,078
Investments in unconsolidated subsidiaries and associated companies.......... 193,126
Customers' liability to this bank on acceptances outstanding................. 592,118
Intangible assets..........................................................
Goodwill.................................................................. 1,300,295
Other intangible assets................................................... 122,143
Other assets................................................................. 3,676,375
-----------
Total assets................................................................. $70,232,359
===========
LIABILITIES
Deposits:
In domestic offices......................................................... $25,962,242
Noninterest-bearing......................................................... 10,586,346
Interest-bearing............................................................ 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and IBFs............... 24,862,377
Noninterest-bearing......................................................... 373,085
Interest-bearing............................................................ 24,489,292
Federal funds purchased and securities sold under agreements to repurchase... 1,446,874
Trading liabilities.......................................................... 2,373,361
Other borrowed money:
(includes mortgage indebtedness and obligations
-4-
under capitalized leases)................................................... 1,381,512
Bank's liability on acceptances executed and outstanding..................... 592,804
Subordinated notes and debentures............................................ 1,646,000
Other liabilities............................................................ 5,373,065
--------------
Total liabilities............................................................ $63,658,235
==============
EQUITY CAPITAL
Common stock................................................................. 1,135,284
Surplus...................................................................... 1,008,773
Retained earnings............................................................ 4,426,033
Accumulated other comprehensive income....................................... 4,034
Other equity capital components.............................................. 0
--------------
Total equity capital......................................................... 6,574,124
--------------
Total liabilities and equity capital......................................... $70,232,359
==============
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi Directors
Gerald L. Hassell
Alan R. Griffith
5
Exhibit 25.3
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
____________________
FORM T-1
Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of a Corporation
Designated to Act as Trustee
____________________
U.S. Bank Trust National Association
(Exact name of trustee as specified in its charter)
United States 94-3160100
(State of Incorporation) (IRS Employer Identification No.)
550 South Hope Street, Suite 500
Los Angeles, California 90071
(Address of principal executive offices and zip code)
____________________
SEMPRA ENERGY GLOBAL ENTERPRISES
(Exact name of obligor as specified in its charter)
California
(State or other jurisdiction of Incorporation or organization)
33-078483
(IRS Employer Identification No.)
101 Ash Street
San Diego, CA 92101
(Address of principal executive offices and Zip code)
John R. Light, Esq.
Executive Vice President and General Counsel
101 Ash Street
San Diego, CA 92101
(619) 696-2034
(Names, addresses and telephone numbers of agents for service)
Senior Debt Securities
(Title of the indenture securities)
GENERAL
1. GENERAL INFORMATION Furnish the following information as to the trustee.
-------------------
(a) Name and address of each examining or supervising authority to which it
is subject.
Comptroller of the Currency
Washington DC
(b) Whether it is authorized to exercise corporate trust powers.
Yes
2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS If the obligor or any underwriter
------------------------------------------
for the obligor is an affiliate of the trustee, describe each such
affiliation.
None
See Note following Item 16.
Items 3-15 are not applicable because to the best of the Trustee's knowledge
----------------------------------------------------------------------------
the obligor is not in default under any Indenture for which the Trustee acts
----------------------------------------------------------------------------
as Trustee.
----------
16. LIST OF EXHIBITS List below all exhibits filed as a part of this statement
----------------
of eligibility and qualification.
Exhibit 1 -Articles of Association of U.S. Bank Trust National Association
dated June 5, 1992. Incorporated herein by reference to Exhibit 1
filed with Form T-1 statement, Registration No. 33-50826
Exhibit 2 -Certificate of the Comptroller of Currency as to authority of
U.S. Bank Trust National Association to commence the business of
banking. Incorporated herein by reference to Exhibit 2 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 3 -Authorization of the Comptroller of Currency granting U.S. Bank
Trust National Association the right to exercise corporate trust
powers. Incorporated herein by reference to Exhibit 3 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 4 -By-Laws of U.S. Bank Trust National Association, dated June 15,
1992. Incorporated herein by reference to Exhibit 4 filed with Form
T-1 Statement, Registration No.33-50826
Exhibit 5 - Not Applicable
Exhibit 6 -Consent of U.S. Bank Trust National Association required by
Section 321(b) of the Act. Incorporated herein by reference to Exhibit
6 filed with Form T-1 Statement, Registration No.33-50826
2
Exhibit 7 -Report of Condition of U.S. Bank Trust National Association,
as of the close of business on June 30, 2001 published pursuant to law
or the requirements of its supervising or examining authority.
NOTE
The answers to this statement insofar as such answers relate to what persons
have been underwriters for any securities of the obligor within three years
prior to the date of filing this statement, or what persons are owners of 10% or
more of the voting securities of the obligor, or affiliates, are based upon
information furnished to the trustee by the obligor. While the trustee has no
reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
U.S. Bank Trust National Association, an Association organized and existing
under the laws of the United States, has duly caused this statement of
eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereunto affixed and attested, all
in the City of Los Angeles and State of California on the 26th day of September
2001.
U.S. BANK TRUST NATIONAL ASSOCIATION
By: /s/ Tamara Mawn
----------------------------------
Tamara Mawn
Vice President
Attest: /s/ Gonzalo Urey
----------------
Gonzalo Urey
Assistant Vice President
3
EXHIBIT 6
C O N S E N T
In accordance with Section 321(b) of the Trust Indenture Act of 1939, the
undersigned, U.S. Bank Trust National Association, hereby consents that reports
of examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.
Dated: September 26, 2001
U.S. BANK TRUST NATIONAL ASSOCIATION
By: /s/ Tamara Mawn
---------------
Tamara Mawn
Vice President
4
U.S. Bank Trust National Association
Statement of Financial Condition
As of 06/30/01
($000's)
Assets:
Cash and Balances Due From Depository Institutions: 86,736
Federal Reserve Stock: 1,270
Fixed Assets: 737
Intangible Assets: 51,868
Other Assets: 12,846
-------
Total Assets: 153,457
-------
Liabilities:
Other Liabilities: 6,734
-------
Total Liabilities: 6,734
-------
Equity:
Common and Preferred Stock: 1,000
Surplus: 126,260
Undivided Profits and Capital Reserve: 19,463
Net unrealized holding gains (losses) on available-for-sale securities 0
-------
Total Equity Capital: 146,723
-------
Total Liabilities and Equity Capital: 153,457
-------
-------------------------------------------------------------------------------
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
U.S. Bank Trust National Association
By: /s/ Tamara Mawn
---------------------
Vice President
5
EXHIBIT 25.4
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [__]
________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
________
Sempra Energy
(Exact name of obligor as specified in its charter)
California 33-0732627
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
________
Guarantee of Preferred Securities of
Sempra Energy Capital Trust II
(Title of the indenture securities)
================================================================================
1. General information. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
---------------------------------------------------------
Name Address
---------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
-------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
-3-
--------------------------------------------------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
In Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin..................................... $ 2,811,275
Interest-bearing balances.............................................................. 3,133,222
Securities:
Held-to-maturity securities............................................................ 147,185
Available-for-sale securities.......................................................... 5,403,923
Federal funds sold and Securities purchased under agreements to resell.................. 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale......................................................... 74,702
Loans and leases, net of unearned income............................................... 37,471,621
LESS: Allowance for loan and lease losses.............................................. 599,061
Loans and leases, net of unearned income and allowance................................. 36,872,560
Trading Assets.......................................................................... 11,757,036
Premises and fixed assets (including capitalized leases)................................ 768,795
Other real estate owned................................................................. 1,078
Investments in unconsolidated subsidiaries and associated companies..................... 193,126
Customers' liability to this bank on acceptances outstanding............................ 592,118
Intangible assets.........................................
Goodwill............................................................................. 1,300,295
Other intangible assets.............................................................. 122,143
Other assets............................................................................ 3,676,375
-----------
Total assets............................................................................ $70,232,359
===========
LIABILITIES
Deposits:
In domestic offices.................................................................... $25,962,242
Noninterest-bearing.................................................................... 10,586,346
Interest-bearing....................................................................... 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and IBFs.......................... 24,862,377
Noninterest-bearing.................................................................... 373,085
Interest-bearing....................................................................... 24,489,292
Federal funds purchased and securities sold under agreements to repurchase.............. 1,446,874
Trading liabilities..................................................................... 2,373,361
Other borrowed money:
(includes mortgage indebtedness and obligations under capitalized leases)............... 1,381,512
Bank's liability on acceptances executed and outstanding................................ 592,804
Subordinated notes and debentures....................................................... 1,646,000
Other liabilities....................................................................... 5,373,065
Total liabilities....................................................................... $63,658,235
EQUITY CAPITAL
Common stock............................................................................ 1,135,284
Surplus................................................................................. 1,008,773
Retained earnings....................................................................... 4,426,033
Accumulated other comprehensive income.................................................. 4,034
Other equity capital components......................................................... 0
---------------------------------------------------------------------------------------------------------
Total equity capital.................................................................... 6,574,124
-----------
Total liabilities and equity capital.................................................... $70,232,359
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi
Gerald L. Hassell Directors
Alan R. Griffith
-5-
Exhibit 25.5
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [__]
_____________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
_____________
Sempra Energy
(Exact name of obligor as specified in its charter)
California 33-0732627
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
_____________
Guarantee of Preferred Securities of
Sempra Energy Capital Trust III
(Title of the indenture securities)
================================================================================
1. General information. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
----------------------------------------------------------------------------------
Name Address
----------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed
with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1
filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-
1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
--------------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
-3-
________________________________________________________________________________
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin................................ $ 2,811,275
Interest-bearing balances......................................................... 3,133,222
Securities:
Held-to-maturity securities....................................................... 147,185
Available-for-sale securities..................................................... 5,403,923
Federal funds sold and Securities purchased under agreements to resell............. 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale.................................................... 74,702
Loans and leases, net of unearned income.......................................... 37,471,621
LESS: Allowance for loan and lease losses......................................... 599,061
Loans and leases, net of unearned income and allowance............................ 36,872,560
Trading Assets..................................................................... 11,757,036
Premises and fixed assets (including capitalized leases)........................... 768,795
Other real estate owned............................................................ 1,078
Investments in unconsolidated subsidiaries and associated companies................ 193,126
Customers' liability to this bank on acceptances outstanding....................... 592,118
Intangible assets
Goodwill.......................................................................... 1,300,295
Other intangible assets........................................................... 122,143
Other assets....................................................................... 3,676,375
------------
Total assets....................................................................... $ 70,232,359
============
LIABILITIES
Deposits:
In domestic offices............................................................... $ 25,962,242
Noninterest-bearing............................................................... 10,586,346
Interest-bearing.................................................................. 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and IBFs..................... 24,862,377
Noninterest-bearing............................................................... 373,085
Interest-bearing.................................................................. 24,489,292
Federal funds purchased and securities sold under agreements to repurchase......... 1,446,874
Trading liabilities................................................................ 2,373,361
Other borrowed money:
(includes mortgage indebtedness and obligations under capitalized leases)......... 1,381,512
-4-
Bank's liability on acceptances executed and outstanding........................... 592,804
Subordinated notes and debentures.................................................. 1,646,000
Other liabilities.................................................................. 5,373,065
-----------
Total liabilities.................................................................. $63,658,235
===========
EQUITY CAPITAL
Common stock....................................................................... 1,135,284
Surplus............................................................................ 1,008,773
Retained earnings.................................................................. 4,426,033
Accumulated other comprehensive income............................................. 4,034
Other equity capital components.................................................... 0
-----------------------------------------------------------------------------------------------------
Total equity capital............................................................... 6,574,124
-----------
Total liabilities and equity capital............................................... $70,232,359
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi
Gerald L. Hassell Directors
Alan R. Griffith
________________________________________________________________________________
-5-
Exhibit 25.6
========================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [_]
______________________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
______________________
Sempra Energy Capital Trust II
(Exact name of obligor as specified in its charter)
Delaware 52-6988598
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
______________________
Preferred Securities
(Title of the indenture securities)
========================================================================
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
-----------------------------------------------------------------
Name Address
-----------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
------------------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
-3-
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin......................................... $ 2,811,275
Interest-bearing balances.................................................................. 3,133,222
Securities:
Held-to-maturity securities................................................................ 147,185
Available-for-sale securities.............................................................. 5,403,923
Federal funds sold and Securities purchased under
agreements to resell....................................................................... 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale............................................................. 74,702
Loans and leases, net of unearned income................................................... 37,471,621
LESS: Allowance for loan and lease losses.................................................. 599,061
Loans and leases, net of unearned income and allowance..................................... 36,872,560
Trading Assets.............................................................................. 11,757,036
Premises and fixed assets (including capitalized leases).................................... 768,795
Other real estate owned..................................................................... 1,078
Investments in unconsolidated subsidiaries and associated companies......................... 193,126
Customers' liability to this bank on acceptances outstanding................................ 592,118
Intangible assets...........................................................................
Goodwill................................................................................... 1,300,295
Other intangible assets.................................................................. 122,143
Other assets................................................................................ 3,676,375
-----------
Total assets................................................................................ $70,232,359
===========
LIABILITIES
Deposits:
In domestic offices........................................................................ $25,962,242
Noninterest-bearing........................................................................ 10,586,346
Interest-bearing........................................................................... 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and IBFs.............................. 24,862,377
Noninterest-bearing........................................................................ 373,085
Interest-bearing........................................................................... 24,489,292
Federal funds purchased and securities sold under agreements to repurchase.................. 1,446,874
Trading liabilities......................................................................... 2,373,361
Other borrowed money:
(includes mortgage indebtedness and obligations under capitalized leases)................... 1,381,512
Bank's liability on acceptances executed and outstanding.................................... 592,804
-4-
Subordinated notes and debentures........................................................... 1,646,000
Other liabilities........................................................................... 5,373,065
-----------
Total liabilities........................................................................... $63,658,235
===========
EQUITY CAPITAL
Common stock................................................................................ 1,135,284
Surplus..................................................................................... 1,008,773
Retained earnings........................................................................... 4,426,033
Accumulated other comprehensive income...................................................... 4,034
Other equity capital components............................................................. 0
-----------------------------------------------------------------------------------------------------------
Total equity capital........................................................................ 6,574,124
-----------
Total liabilities and equity capital........................................................ $70,232,359
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
__
Thomas A. Renyi
Gerald L. Hassell Directors
Alan R. Griffith
__
--------------------------------------------------------------------------------
-5-
Exhibit 25.7
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
Sempra Energy Capital Trust III
(Exact name of obligor as specified in its charter)
Delaware 52-6988599
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
_____________
Preferred Securities
(Title of the indenture securities)
-===============================================================================
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
----------------------------------------------------------------------------------
Name Address
----------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-
44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-2-
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
------------------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
-3-
--------------------------------------------------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
ASSETS Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.................... $ 2,811,275
Interest-bearing balances............................................. 3,133,222
Securities:
Held-to-maturity securities........................................... 147,185
Available-for-sale securities......................................... 5,403,923
Federal funds sold and Securities purchased under agreements to
resell................................................................ 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale........................................ 74,702
Loans and leases, net of unearned income.............................. 37,471,621
LESS: Allowance for loan and lease losses............................. 599,061
Loans and leases, net of unearned income and allowance................ 36,872,560
Trading Assets......................................................... 11,757,036
Premises and fixed assets (including capitalized leases)............... 768,795
Other real estate owned................................................ 1,078
Investments in unconsolidated subsidiaries and associated companies.... 193,126
Customers' liability to this bank on acceptances outstanding........... 592,118
Intangible assets......................................................
Goodwill............................................................ 1,300,295
Other intangible assets............................................. 122,143
Other assets........................................................... 3,676,375
-----------
Total assets........................................................... $70,232,359
===========
LIABILITIES
Deposits:
In domestic offices................................................... $25,962,242
Noninterest-bearing................................................... 10,586,346
Interest-bearing...................................................... 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and IBFs......... 24,862,377
Noninterest-bearing................................................... 373,085
Interest-bearing...................................................... 24,489,292
Federal funds purchased and securities sold under agreements to
repurchase............................................................ 1,446,874
Trading liabilities.................................................... 2,373,361
Other borrowed money:.................................................. 1,381,512
(includes mortgage indebtedness and obligations
-4-
under capitalized leases).......
Bank's liability on acceptances executed and outstanding.. 592,804
Subordinated notes and debentures......................... 1,646,000
Other liabilities......................................... 5,373,065
-----------
Total liabilities......................................... $63,658,235
===========
EQUITY CAPITAL
Common stock.............................................. 1,135,284
Surplus................................................... 1,008,773
Retained earnings......................................... 4,426,033
Accumulated other comprehensive income.................... 4,034
Other equity capital components........................... 0
----------------------------------------------------------------------------------------
Total equity capital...................................... 6,574,124
-----------
Total liabilities and equity capital...................... $70,232,359
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi ]
Gerald L. Hassell ] Directors
Alan R. Griffith ]
--------------------------------------------------------------------------------
-5-
Exhibit 25.8
========================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) [__]
_____________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
_____________
Sempra Energy Global Enterprises
(Exact name of obligor as specified in its charter)
California 33-0783483
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
101 Ash Street
San Diego, California 92101
(Address of principal executive offices) (Zip code)
_____________
Debt Securities
(Title of the indenture securities)
========================================================================
1. General information. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
------------------------------------------------------------------------------
Name Address
------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
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SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of September, 2001.
THE BANK OF NEW YORK
By: /s/ MING SHIANG
-------------------------------
Name: MING SHIANG
Title: VICE PRESIDENT
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Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business March 31, 2001,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........... $ 2,811,275
Interest-bearing balances.................................... 3,133,222
Securities:
Held-to-maturity securities.................................. 147,185
Available-for-sale securities................................ 5,403,923
Federal funds sold and Securities purchased under
agreements to resell......................................... 3,378,526
Loans and lease financing receivables:
Loans and leases held for sale............................... 74,702
Loans and leases, net of unearned
income....................................................... 37,471,621
LESS: Allowance for loan and
lease losses................................................. 599,061
Loans and leases, net of unearned
income and allowance......................................... 36,872,560
Trading Assets................................................ 11,757,036
Premises and fixed assets (including capitalized leases)...... 768,795
Other real estate owned....................................... 1,078
Investments in unconsolidated subsidiaries and associated
companies.................................................... 193,126
Customers' liability to this bank on acceptances
outstanding.................................................. 592,118
Intangible assets.............................................
Goodwill................................................... 1,300,295
Other intangible assets.................................... 122,143
Other assets.................................................. 3,676,375
-----------
Total assets.................................................. $70,232,359
===========
LIABILITIES
Deposits:
In domestic offices.......................................... $25,962,242
Noninterest-bearing.......................................... 10,586,346
Interest-bearing............................................. 15,395,896
In foreign offices, Edge and Agreement subsidiaries, and
IBFs........................................................ 24,862,377
Noninterest-bearing.......................................... 373,085
Interest-bearing............................................. 24,489,292
Federal funds purchased and securities sold under
agreements to repurchase..................................... 1,446,874
Trading liabilities........................................... 2,373,361
Other borrowed money:
(includes mortgage indebtedness and obligations
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under capitalized leases).................................... 1,381,512
Bank's liability on acceptances executed and outstanding...... 592,804
Subordinated notes and debentures............................. 1,646,000
Other liabilities............................................. 5,373,065
-----------
Total liabilities............................................. $63,658,235
===========
EQUITY CAPITAL
Common stock.................................................. 1,135,284
Surplus....................................................... 1,008,773
Retained earnings............................................. 4,426,033
Accumulated other comprehensive income........................ 4,034
Other equity capital components............................... 0
------------------------------------------------------------------------------
Total equity capital.......................................... 6,574,124
-----------
Total liabilities and equity capital.......................... $70,232,359
===========
I, Thomas J. Mastro, Senior Vice President and Comptroller of the above-
named bank do hereby declare that this Report of Condition has been prepared in
conformance with the instructions issued by the Board of Governors of the
Federal Reserve System and is true to the best of my knowledge and belief.
Thomas J. Mastro,
Senior Vice President and Comptroller
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
Thomas A. Renyi ] Directors
Gerald L. Hassell ]
Alan R. Griffith ]
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