1
Exhibit 4-a
Execution Copy
SBC COMMUNICATIONS INC.
as Issuer and Registrant of Securities
AND
THE BANK OF NEW YORK
Trustee
--------------------
INDENTURE
Dated as of November 1, 1994
-------------------
Providing for Issuance of Securities in Series
2
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939. This reconciliation section does
not constitute part of the Indenture.
Trust Indenture Act Indenture
of 1939 Section Section
- ------------------- ---------
310(a)(1) . . . . . . . . . . . . . . . . . . . 7.10
(a)(2) . . . . . . . . . . . . . . . . . . . 7.10
(a)(3) . . . . . . . . . . . . . . . . . . . Inapplicable
(a)(4) . . . . . . . . . . . . . . . . . . . Inapplicable
(b) . . . . . . . . . . . . . . . . . . . . . 7.08; 7.10
(c) . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . 7.11
(b) . . . . . . . . . . . . . . . . . . . . . 7.11
(c) . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . 2.07
(b) . . . . . . . . . . . . . . . . . . . . . 10.03
(c) . . . . . . . . . . . . . . . . . . . . . 10.03
313(a) . . . . . . . . . . . . . . . . . . . . . 7.06
(b)(1) . . . . . . . . . . . . . . . . . . . Inapplicable
(b)(2) . . . . . . . . . . . . . . . . . . . 7.06; 10.02
(c) . . . . . . . . . . . . . . . . . . . . . 10.02
(d) . . . . . . . . . . . . . . . . . . . . . 7.06
314(a) . . . . . . . . . . . . . . . . . . . . . 4.02; 10.02
(b) . . . . . . . . . . . . . . . . . . . . . Inapplicable
(c)(1) . . . . . . . . . . . . . . . . . . . 10.04
(c)(2) . . . . . . . . . . . . . . . . . . . 10.04
(c)(3) . . . . . . . . . . . . . . . . . . . Inapplicable
(d) . . . . . . . . . . . . . . . . . . . . . Inapplicable
(e) . . . . . . . . . . . . . . . . . . . . . 10.05
(f) . . . . . . . . . . . . . . . . . . . . . Inapplicable
315(a) . . . . . . . . . . . . . . . . . . . . . 7.01(b)
(b) . . . . . . . . . . . . . . . . . . . . . 7.05; 10.02
(c) . . . . . . . . . . . . . . . . . . . . . 7.01(a)
(d) . . . . . . . . . . . . . . . . . . . . . 7.01(c)
(e) . . . . . . . . . . . . . . . . . . . . . 6.11
316(a)(last sentence) . . . . . . . . . . . . . 2.11
(a)(1)(A) . . . . . . . . . . . . . . . . . . 6.05
(a)(1)(B) . . . . . . . . . . . . . . . . . . 6.04
(a)(2) . . . . . . . . . . . . . . . . . . . Inapplicable
(b) . . . . . . . . . . . . . . . . . . . . . 6.07
317(a)(1) . . . . . . . . . . . . . . . . . . . 6.08
(a)(2) . . . . . . . . . . . . . . . . . . . 6.09
(b) . . . . . . . . . . . . . . . . . . . . . 2.06
318(a) . . . . . . . . . . . . . . . . . . . . . 10.01
3
TABLE OF CONTENTS*
PAGE
----
ARTICLE 1DEFINITIONS AND INCORPORATION BY REFERENCE......1
1.01 Definitions...............................................1
1.02 Other Definitions.........................................4
1.03 Incorporation by Reference of Trust Indenture Act.........4
1.04 Rules of Construction.....................................4
ARTICLE 2
THE SECURITIES................................5
2.01 Issuable in Series........................................5
2.02 Establishment of Terms and Form of Series of
Securities..............................................5
2.03 Execution, Authentication and Delivery....................7
2.04 Registrar and Paying Agent...............................10
2.05 Payment on Securities....................................10
2.06 Paying Agent to Hold Money in Trust......................11
2.07 Securityholder Lists; Ownership of Securities............12
2.08 Registration of Transfer and Exchange....................12
2.09 Replacement Securities...................................15
2.10 Outstanding Securities...................................16
2.11 Treasury Securities......................................17
2.12 Temporary Securities.....................................17
2.13 Cancellation.............................................18
2.14 Defaulted Interest.......................................18
2.15 CUSIP Numbers............................................18
ARTICLE 3 REDEMPTION.........................19
3.01 Notice to Trustee........................................19
3.02 Selection of Securities to be Redeemed...................19
3.03 Notice of Redemption.....................................19
3.04 Effect of Notice of Redemption...........................20
3.05 Deposit of Redemption Price..............................20
3.06 Securities Redeemed in Part..............................21
ARTICLE 4 COVENANTS..........................21
4.01 Payment of Securities....................................21
4.02 Reports by SBC...........................................21
4.03 Statement as to Compliance...............................22
4.04 Calculation of Original Issue Discount...................22
ARTICLE 5 SUCCESSORS.........................22
- --------
* This Table of Contents Does Not Constitute Part of the Indenture.
-i-
4
5.01 When SBC May Merge, etc..................................22
ARTICLE 6 DEFAULTS AND REMEDIES..............23
6.01 Events of Default........................................23
6.02 Acceleration.............................................24
6.03 Other Remedies Available to Trustee......................25
6.04 Waiver of Existing Defaults..............................26
6.05 Control by Majority......................................26
6.06 Limitation on Suits by Securityholders...................27
6.07 Rights of Holders to Receive Payment.....................27
6.08 Collection Suits by Trustee..............................27
6.09 Trustee May File Proofs of Claim.........................28
6.10 Priorities...............................................28
6.11 Undertaking for Costs....................................28
ARTICLE 7 TRUSTEE............................29
7.01 Duties of Trustee........................................29
7.02 Rights of Trustee........................................30
7.03 Individual Rights of Trustee.............................31
7.04 Trustee's Disclaimer.....................................31
7.05 Notice of Defaults.......................................31
7.06 Reports by Trustee to Holders............................31
7.07 Compensation and Indemnity...............................32
7.08 Replacement of Trustee...................................32
7.09 Successor Trustee, Agents by Merger, etc.................34
7.10 Eligibility; Disqualification............................34
7.11 Preferential Collection of Claims Against ...............35
ARTICLE 8 DISCHARGE OF INDENTURE.............35
8.01 Termination of SBC's Obligations.........................35
8.02 Application of Trust Money...............................36
8.03 Repayment to ............................................36
8.04 Indemnity for Government Obligations.....................36
ARTICLE 9 AMENDMENTS AND WAIVERS.............37
9.01 Without Consent of Holders...............................37
9.02 With Consent of Holders..................................37
9.03 Compliance with Trust Indenture Act......................39
9.04 Revocation and Effect of Consents........................39
9.05 Notation on or Exchange of Securities....................39
9.06 Trustee Protected........................................39
9.07 Execution of Supplemental Indentures.....................39
ARTICLE 10 MISCELLANEOUS.....................40
10.01 Trust Indenture Act Controls............................40
10.02 Notices.................................................40
-ii-
5
10.03 Communication by Holders with Other Holders.............41
10.04 Certificate and Opinion as to Conditions Precedent......41
10.05 Statements Required in Certificate or Opinion...........41
10.06 Rules by Trustee and Agents.............................42
10.07 Legal Holidays..........................................42
10.08 Governing Law...........................................42
10.09 No Adverse Interpretation of Other Agreements...........42
10.10 No Recourse Against Others..............................42
10.11 Acts of Holders.........................................42
10.12 Execution in Counterparts...............................44
SIGNATURES............................................................44
-iii-
6
INDENTURE dated as of November 1, 1994 between SBC COMMUNICATIONS INC., a
Delaware corporation ("SBC"), and THE BANK OF NEW YORK, a New York banking
company duly organized and validly existing under the laws of the State of New
York ("Trustee").
RECITALS OF SBC
SBC has duly authorized the execution and delivery of this Indenture for
the issuance from time to time of its unsecured debentures, notes or other
evidences of indebtedness ("Securities") as herein provided.
All things necessary to make this Indenture a valid agreement of SBC, in
accordance with its terms, have been done.
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed as
follows for the equal and ratable benefit of the Holders of the Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
"Affiliate" means any person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, SBC.
"Agent" means any Paying Agent, Registrar, or co-Registrar.
"Authorized Newspaper" means a newspaper of general circulation, in an
official language of the country of publication or in the English language,
customarily published on days other than Legal Holidays, as defined in Section
10.07, in such country. Whenever successive weekly publications in an Authorized
Newspaper are required hereunder, they may be made (unless otherwise expressly
provided herein) on the same or different days of the week and in the same or
different Authorized Newspapers.
"Board of Directors" means the Board of Directors of SBC, or any duly
authorized committee thereof.
"Board Resolution" means a copy of a resolution of the Board of Directors,
certified by the Secretary or an Assistant Secretary of SBC to have been duly
adopted by the Board of Directors and to be in full force and effect.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default.
7
"Depository" means, with respect to the Securities of any Series issuable
or issued in whole or in part in the form of one or more Global Securities, the
person designated as Depository by SBC pursuant to Section 2.02.
"Global Security" means a Security in the form prescribed in Section 2.02
evidencing all or part of a Series of Securities, issued to the Depository for
such series or its nominee, and registered in the name of such Depository or
nominee.
"Holder" or "Securityholder" means the bearer of an Unregistered Security
or of a coupon appertaining thereto or the person in whose name a Registered
Security is registered on the Registrar's books.
"Indenture" means this Indenture as amended or supplemented from time to
time including, for all purposes of this instrument and any such amendment or
supplement, the provisions of the TIA that are deemed to be a part of and govern
this instrument and any such amendment or supplement, respectively. The term
"Indenture" shall also include the forms and terms of a particular Series of
Securities established as contemplated hereunder.
"Officer" means the Chairman of the Board of Directors, any Vice Chairman
of the Board of Directors, the President, any Vice-President, the Treasurer or
the Secretary of SBC.
"Officers' Certificate" means a certificate signed by two Officers or by
any Officer and an Assistant Treasurer or an Assistant Secretary of SBC.
"Opinion of Counsel" means a written opinion of legal counsel who is
acceptable to SBC and the Trustee. Counsel may be an employee of or counsel to
SBC or the Trustee.
"Order" means an order in the name of SBC signed by two Officers or by any
Officer and an Assistant Treasurer or an Assistant Secretary of SBC.
"Original Issue Discount Security" means any Security which provides for
an amount less than the stated principal amount thereof to be due and payable
upon declaration of acceleration of the maturity thereof pursuant to Section
6.02.
"Principal" of a debt security means the principal of the security plus,
when appropriate, the premium, if any, on the security.
"Registered Security" means any Security issued hereunder and
registered by the Registrar.
"Responsible Officer", when used with respect to the Trustee,
shall mean the chairman or any vice-chairman of the board of directors
-2-
8
or trustees, the chairman or any vice-chairman of the executive committee of the
board of directors or trustees, the president, any vice-president, the
treasurer, the secretary, any trust officer, any second or assistant
vice-president or any other officer or assistant officer of the Trustee
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of his knowledge of and familiarity with a particular
subject.
"SBC" means the party named as such in this Indenture until a successor
replaces it pursuant to the applicable provisions hereof and thereafter means
the successor.
"SEC" means the Securities and Exchange Commission.
"Series" or "Series of Securities" means a series of Securities.
"Securities" means the debentures, notes or other obligations of SBC
issued, authenticated and delivered under this Indenture.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by SBC or by one or more other
of its Subsidiaries, or by SBC and one or more other of its Subsidiaries. For
the purposes of this definition, "voting stock" means stock which ordinarily has
voting power for the election of directors, whether at all times or only so long
as no senior class of stock has such voting power by reason of any contingency.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date of
this Indenture provided, however, that in the event the Trust Indenture Act of
1939 is amended after such date, "TIA" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to the applicable provisions hereof and
thereafter means the successor and if, at any time, there is more than one
Trustee, "Trustee" as used with respect to the Securities of any Series shall
mean the Trustee with respect to that Series.
"U.S. person" means a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under the
laws of the United States or a political subdivision thereof, or an estate or
trust the income of which is subject to United States Federal income taxation
regardless of its source.
"United States" means the United States of America (including the States
and the District of Columbia), its territories, its possessions and all other
areas subject to its jurisdiction.
-3-
9
"Unregistered Security" means any Security issued hereunder which
is not a Registered Security.
"Yield to Maturity" means the yield to maturity, calculated by SBC at the
time of issuance of a Series of Securities or, if applicable, at the most recent
determination of interest on such Series in accordance with accepted financial
practice.
SECTION 1.02 Other Definitions.
Term Section
---- -------
"Bankruptcy Law". . . . . . . . . . . . 6.01
"Custodian" . . . . . . . . . . . . . . 6.01
"Event of Default" . . . . . . . . . . 6.01
"Legal Holiday" . . . . . . . . . . . . 10.07
"Paying Agent" . . . . . . . . . . . . 2.04
"Registrar" . . . . . . . . . . . . . . 2.04
"U.S. Government Obligations" . . . . . 8.01
SECTION 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means SBC.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings assigned to them therein.
SECTION 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with accounting principles generally accepted
in the United States of America.
(3) "or" is not exclusive; and
-4-
10
(4) words in the singular include the plural, and words
in the plural include the singular.
ARTICLE 2
THE SECURITIES
SECTION 2.01 Issuable in Series.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited. The Securities may be issued in
one or more Series. There may be Registered Securities and Unregistered
Securities within a Series and the Unregistered Securities may be subject to
such restrictions, and contain such legends, as may be required by United States
laws and regulations. Except as provided in the foregoing sentence or as
otherwise provided by or pursuant to the Board Resolution referred to in Section
2.02, all Securities of a Series shall be identical in all respects. Securities
of different Series may differ in any respect; provided that all Series of
Securities shall be equally and ratably entitled to the benefits of this
Indenture.
SECTION 2.02 Establishment of Terms and Form of Series of Securities.
(a) At or prior to the issuance of any Series of Securities, the following
shall be established either by or pursuant to a Board Resolution, and set forth
in an Officers' Certificate, or by an indenture supplemental hereto:
(1) the title of the Securities of the Series (which title shall
distinguish the Securities of the Series from the Securities of all other
Series and from all other securities issued by SBC);
(2) any limit upon the aggregate principal amount of the
Securities of the Series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the Series pursuant to Section 2.08, 2.09, 2.12, 3.06 or
9.05);
(3) the date or dates on which the principal of the
Securities of the Series is payable;
(4) the rate or rates at which the Securities of the Series shall
bear interest, if any, or the method of calculating such rate or rates of
interest, the date or dates from which such interest shall accrue, the
dates on which such interest shall be payable and, with respect to
Registered Securities, the record date for the interest payable on any
interest payment date;
-5-
11
(5) the place or places where the principal of and
interest on Registered and any Unregistered Securities of the
Series shall be payable;
(6) the period or periods within which, the price or prices at
which, and the terms and conditions upon which, Securities of the Series
may be redeemed, in whole or in part, at the option of SBC;
(7) the obligation, if any, of SBC to redeem or purchase
Securities of the Series pursuant to any sinking fund or analogous
provisions or upon the happening of a specified event or at the option of
a Holder thereof and the period or periods within which, the price or
prices at which, and the terms and conditions upon which, Securities of
the Series shall be redeemed or purchased, in whole or in part, pursuant
to such obligation;
(8) if in other than denominations of $1,000 and any integral
multiple thereof, the denominations in which Securities of the Series
shall be issuable;
(9) if other than the principal amount thereof, the portion of
the principal amount of Securities of the Series which shall be payable
upon declaration or acceleration of the maturity thereof pursuant to
Section 6.02;
(10) whether Securities of the Series shall be issuable as
Registered Securities or Unregistered Securities (with or without interest
coupons), or both, and any restrictions applicable to the offering, sale
or delivery of Unregistered Securities and whether, and the terms upon
which, Unregistered Securities of a Series may be exchanged for Registered
Securities of the same Series and vice versa;
(11) whether and under what circumstances SBC will pay additional
amounts on the Securities of that Series held by a person who is not a
U.S. person in respect of taxes or similar charges withheld or deducted
and, if so, whether SBC will have the option to redeem such Securities
rather than pay such additional amounts;
(12) the currency or currencies, including composite currencies,
in which payment of the principal of and interest on the Securities of the
Series shall be payable (if other than the currency of the United States
of America);
(13) if the amount or payments of principal of or interest on the
Securities of the Series may be determined with reference to an index, the
manner in which such amounts shall be determined;
-6-
12
(14) the obligation, if any, of SBC to permit the conversion or
exchange of the Securities of the Series into other securities (whether or
not issued by, or the obligation of, SBC), and the terms and conditions
upon which such conversion or exchange shall be effected (including,
without limitation, the initial conversion or exchange price or rate, the
conversion or exchange period and any other provisions in addition to or
in lieu of those set forth in this Indenture relative to such obligation;
(15) whether the Securities of the Series shall be issuable in
whole or in part in the form of one or more Global Securities and, in such
case, the Depository for such Global Security or Securities, which
Depository shall be a clearing agency registered under the Securities
Exchange Act of 1934, as amended;
(16) any other terms of the Series (which terms shall not be
inconsistent with the provisions of this Indenture), including any terms
which may be required by or advisable under United States laws or
regulations or advisable in connection with the marketing of Securities of
that Series;
(17) the form of the Securities (or forms thereof if Unregistered
and Registered Securities shall be issuable in such Series, including such
legends as may be required by United States laws or regulations, the form
of any coupons or temporary global Security which may be issued and the
forms of any certificates which may be required hereunder or under United
States laws or regulations in connection with the offering, sale, delivery
or exchange of Unregistered Securities); and
(18) the CUSIP number, if any.
(b) If the terms and form or forms of any Series of Securities are
established by or pursuant to a Board Resolution, SBC shall deliver a copy of
such Board Resolution to the Trustee at or prior to the issuance of such Series
with (1) the form or forms of Security which have been approved attached
thereto, or (2) if such Board Resolution authorized Officers to approve the
terms and form or forms of the Securities, an Officers' Certificate approving
the terms and form or forms of Security with such form or forms of Securities
attached thereto.
SECTION 2.03 Execution, Authentication and Delivery.
(a) Securities shall be executed on behalf of SBC by its Chairman of the
Board of Directors or a Vice-Chairman of the Board of Directors or its President
or a Vice-President, and its Treasurer or an Assistant Treasurer or its
Secretary or an Assistant Secretary. Signatures shall be manual or facsimile.
SBC's seal shall be reproduced on the Securities and may, but need not, be
attested. The coupons of
-7-
13
Unregistered Securities shall bear the facsimile signature of the Treasurer or
an Assistant Treasurer of SBC.
(b) If an Officer, an Assistant Treasurer or an Assistant Secretary of SBC
whose signature is on a Security or coupon no longer holds that office at the
time the Security is authenticated, the Security or coupon shall be valid
nevertheless.
(c) A Security shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent and no coupon shall be valid
until the Security to which it appertains has been so authenticated. Such
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture. Each Registered Security shall be dated the date of its
authentication, and each Unregistered Security shall be dated as provided in
connection with the establishment of the Series thereof.
(d) The Trustee shall at any time, and from time to time, authenticate and
deliver Securities of any Series executed and delivered by SBC for original
issue in an aggregate principal amount not in excess of the principal amount
authorized for such Series, upon receipt by the Trustee of (i) an Order for the
authentication and delivery of such Securities, (ii) if the terms and form or
forms of the Securities of such Series have been established by or pursuant to a
Board Resolution as permitted by Section 2.02, a copy of such Board Resolution
and any Officers' Certificate that may be required pursuant to Section 2.02(b),
and (iii) an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or
pursuant to a Board Resolution as permitted by Section 2.02, that such
form has been established in conformity with the provisions of this
Indenture;
(2) if the terms of such Securities have been established by or
pursuant to a Board Resolution as permitted by Section 2.02, that such
terms have been established in conformity with the provisions of this
Indenture; and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by SBC in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of SBC entitled to the benefits of the Indenture.
Notwithstanding the provisions of Section 2.02 and of the preceding
paragraph, if all Securities of a Series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 2.02(b) or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the time
of authentication of each Security of such Series if such documents are
delivered at or prior
-8-
14
to the time of authentication upon original issuance of the first Security of
such series to be issued.
If the terms and form or forms of such Securities have been established by
or pursuant to a Board Resolution as permitted by Section 2.02, the Trustee
shall not be required to authenticate such Securities if the issue of such
Securities pursuant to this Indenture will adversely affect the Trustee's own
rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the Trustee.
Notwithstanding the foregoing, until SBC has delivered an Officers'
Certificate to the Trustee and the Registrar stating that, as a result of the
action described, SBC would not suffer adverse consequences under the provisions
of United States law or regulations in effect at the time of the delivery of
Unregistered Securities, (i) delivery of Unregistered Securities by the Trustee
or Registrar will be made only outside the United States and (ii) Unregistered
Securities will be released by the Trustee or Registrar in definitive form to
the person entitled to physical delivery thereof only upon presentation of a
certificate in the form prescribed by SBC.
(e) If SBC shall establish pursuant to Section 2.02 that the Securities of
a Series are to be issued in whole or in part in the form of one or more Global
Securities, then SBC shall execute and the Trustee shall, in accordance with
this Section and SBC's Order with respect to such Series, authenticate and
deliver one or more Global Securities that (i) shall represent and shall be
denominated in an amount equal to the aggregate principal amount of outstanding
Securities of such series to be represented by one or more Global Securities;
(ii) shall be registered in the name of the Depository for such Global Security
or Securities or the nominee of such Depository, (iii) shall be delivered by the
Trustee to such Depository or pursuant to such Depository's instruction and (iv)
shall bear a legend substantially to the following effect: "This Security is a
Global Security within the meaning of the Indenture hereinafter referred to and
is registered in the name of a Depository or a nominee of a Depository. Unless
and until it is exchanged in whole or in part for Securities in definitive form
in accordance with the provisions of the Indenture and the terms of the
Securities, this Security may not be transferred except as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the Depository or any
such nominee to a successor Depository or a nominee of such successor
Depository."
Each depository designated pursuant to Section 2.02 for a Global Security
must, at the time of its designation and at all times while it serves as
Depository, be a clearing agency registered under the Securities Exchange Act of
1934, as amended, and any other applicable statute or regulation.
-9-
15
(f) The Trustee may appoint an authenticating agent to authenticate
Securities. An authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with SBC or an Affiliate thereof.
SECTION 2.04 Registrar and Paying Agent.
SBC shall maintain in the Borough of Manhattan, The City of New York,
State of New York, an office or agency where Registered Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where (subject to Sections 2.05(c) and 2.08(b)) Securities may
be presented for payment or for exchange ("Paying Agent"). With respect to any
Series of Securities issued in whole or in part as Unregistered Securities, SBC
shall maintain one or more Paying Agents located outside the United States and
shall maintain such Paying Agents for a period of two years after the principal
of such Unregistered Securities has become due and payable. During any period
thereafter for which it is necessary in order to conform to United States tax
law or regulations, SBC will maintain a Paying Agent outside the United States
to which the Unregistered Securities or coupons appertaining thereto may be
presented for payment and will provide the necessary funds therefor to such
Paying Agent upon reasonable notice. The Registrar shall keep a register with
respect to each Series of Securities issued in whole or in part as Registered
Securities and to their transfer and exchange. SBC may appoint one or more
co-Registrars acceptable to the Trustee and one or more additional Paying Agents
for each Series of Securities and SBC may terminate the appointment of any
co-Registrar or Paying Agent at any time upon written notice. The term
"Registrar" includes any co-Registrar. The term "Paying Agent" includes any
additional Paying Agent. SBC shall notify the Trustee of the name and address of
any Agent not a party to this Indenture. If SBC fails to maintain a Registrar or
Paying Agent, the Trustee shall act as such.
SBC initially appoints the Trustee as Registrar and Paying Agent.
SECTION 2.05 Payment on Securities.
(a) Subject to the following provisions, SBC will pay to the Trustee the
amounts, in such coin or currency as is at the time legal tender for the payment
of public or private debt, in the manner, at the times and for the purposes set
forth herein and in the text of the Securities for each Series, and SBC hereby
authorizes and directs the Trustee from funds so paid to it to make or cause to
be made payment of the principal of and interest, if any, on the Securities and
coupons of each Series as set forth herein and in the text of such Securities
and coupons. The Trustee will arrange directly with any Paying Agents for the
payment, or the Trustee will make payment, from funds furnished by SBC, of the
principal and interest, if any, on the Securities and
-10-
16
coupons of each Series by check drawn upon a bank in The City of New York.
(b) Interest, if any, on Registered Securities of a Series shall be paid
on each interest payment date for such Series to the Holder thereof at the close
of business on the relevant record dates specified in the Securities of such
Series. SBC may pay such interest by check mailed to such Holder's address as it
appears on the register for Securities of such Series. Principal of Registered
Securities shall be payable only against presentation and surrender thereof at
the office of the Paying Agent in New York, New York, unless SBC shall have
otherwise instructed the Trustee in writing.
(c) To the extent provided in the Securities of a Series, (i) interest, if
any, on Unregistered Securities shall be paid only against presentation and
surrender of the coupons for such interest installments as are evidenced thereby
as they mature and (ii) original issue discount (as defined in Section 1273 of
the Internal Revenue Code of 1986, as amended), if any, on Unregistered
Securities shall be paid only against presentation and surrender of such
Securities, in either case at the office of a Paying Agent located outside of
the United States, unless SBC shall have otherwise instructed the Trustee in
writing. Principal of Unregistered Securities shall be paid only against
presentation and surrender thereof as provided in the Securities of a Series. If
at the time a payment of principal of or interest, if any, or original issue
discount, if any, on an Unregistered Security or coupon shall become due the
payment of the full amount so payable at the office or offices of all the Paying
Agents outside the United States is illegal or effectively precluded because of
the imposition of exchange controls or other similar restrictions on the payment
of such amount in the United States currency, then SBC may instruct the Trustee
to make such payments at the office of a Paying Agent located in the United
States, provided that provision for such payment in the United States would not
cause such Unregistered Security to be treated as a "registration-required
obligation" under United States law and regulations.
SECTION 2.06 Paying Agent to Hold Money in Trust.
SBC will require each Paying Agent for any Series of Securities other than
the Trustee to agree in writing that it will hold all sums held by it for the
payment of principal of and interest on Securities of that Series in trust for
the benefit of the persons entitled thereto until such sums are paid to such
persons or otherwise disposed of as herein provided, and that the Paying Agent
will notify promptly the Trustee of any default by SBC in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. If SBC acts as Paying Agent,
it shall segregate the money held by it for the payment of principal of and
interest on any Series of Securities and hold such money as a separate trust
fund. SBC at any time may require a Paying Agent to pay all money
-11-
17
held by it to the Trustee. Upon so doing the Paying Agent shall have no
further liability for the money so paid.
SECTION 2.07 Securityholder Lists; Ownership of Securities.
(a) The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list received by or furnished to it of the names and
addresses of Holders of Securities. If the Trustee is not the Registrar or if
Unregistered Securities are outstanding under the Indenture, SBC shall furnish
to the Trustee semiannually on or before the last day of June and December in
each year, and at such other times as the Trustee may request in writing, a
list, in such form and as of such date as the Trustee may reasonably require,
containing all the information in the possession or control of the Registrar,
any co- Registrar, SBC or any of its Paying Agents other than the Trustee as to
the names and addresses of Holders of Securities.
(b) Ownership of Registered Securities of a Series shall be proved by the
register for such Series kept by the Registrar. Ownership of Unregistered
Securities may be proved by the production of such Unregistered Securities or by
a certificate or affidavit executed by the person holding such Unregistered
Securities or by a depository with whom such Unregistered Securities were
deposited, if the certificate or affidavit is satisfactory to the Trustee. SBC,
the Trustee, and any agent of SBC may treat the bearer of any Unregistered
Security or coupon and the person in whose name a Registered Security is
registered as the absolute owner thereof for all purposes.
(c) Notwithstanding the foregoing, with respect to any Global Security,
nothing herein shall prevent SBC, the Trustee or any agent of SBC or the Trustee
from giving effect to any written certification, proxy or other authorization
furnished by a Depository or impair, as between a Depository and holders of
beneficial interests in any Global Security, the operation of customary
practices governing the exercise of the rights of the Depository as Holder of
such Global Security. None of SBC, the Trustee, any Paying agent or the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Global Security or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 2.08 Registration of Transfer and Exchange.
(a) When Registered Securities of a Series are presented to the Registrar
with a request to register their transfer or to exchange them for an equal
principal amount of Registered Securities of the same Series and of like tenor
of other authorized denominations, the Registrar shall register the transfer or
make the exchange if its customary requirements for such transactions are met.
-12-
18
(b) If both Registered and Unregistered Securities are authorized for a
Series of Securities and the terms of such Securities permit, Unregistered
Securities may be exchanged for an equal principal amount of Registered or
Unregistered Securities of the same Series and of like tenor in any authorized
denominations upon delivery to the Registrar (or a Paying Agent, if the exchange
is for Unregistered Securities) of the Unregistered Security with all unmatured
coupons and all matured coupons in default appertaining thereto and if all other
requirements of the Registrar (or such Paying Agent) and such Securities for
such exchange are met.
Notwithstanding the foregoing, the exchange of Unregistered Securities for
Registered Securities will be subject to the satisfaction of the provisions of
United States law and regulations in effect at the time of such exchange, and no
exchange will be made until SBC has notified the Trustee and the Registrar that,
as a result of such exchange, SBC would not suffer adverse consequences under
such law or regulations.
(c) To permit registrations of transfers and exchanges, the Trustee shall
authenticate Securities upon surrender of Securities for registration of
transfer or for exchange as provided in this Section. SBC will not make any
charge for any registration of transfer or exchange but may require the payment
by the party requesting such registration of transfer or exchange of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith, but not for any exchange pursuant to Section 2.12, 3.06 or 9.05.
(d) Neither SBC nor the Registrar shall be required (i) to issue, register
the transfer of or exchange Securities of any Series for the period beginning at
the opening of business 15 days immediately preceding the selection of any such
Securities to be redeemed and ending at the close of business on the day of
first publication of the relevant notice of redemption or, if there is no
publication, the mailing of the relevant notice of redemption, or (ii) to
register the transfer of or exchange Securities of any Series selected, called
or being called for redemption as a whole or the portion being redeemed of any
such Securities selected, called or being called for redemption in part.
(e) Unregistered Securities or any coupons appertaining thereto
shall be transferable by delivery.
(f) Notwithstanding the foregoing, any Global Security shall be
exchangeable pursuant to this Section 2.08 for Securities registered in the
names of Persons other than the Depository for such Security or its nominee only
if (i) such Depository notifies SBC that it is unwilling or unable to continue
as Depository for such Global Security or if at any time such Depository ceases
to be a clearing agency registered under the Securities Exchange Act of 1934, as
amended, (ii) SBC executes and delivers to the Trustee an Order that such Global
Security shall be so exchangeable or (iii) there shall have occurred and be
continuing an
-13-
19
Event of Default with respect to the Securities. Any Global Security that is
exchangeable pursuant to the preceding sentence shall be exchangeable for
Securities registered in such names as such Depository shall direct.
Notwithstanding any other provision in this Indenture, a Global Security
may not be transferred except as a whole by the Depository with respect to such
Global Security to a nominee of such Depository or by a nominee of such
Depository to such Depository or another nominee of such Depository.
(g) If at any time the Depository for the Securities of a Series notifies
SBC that it is unwilling or unable to continue as Depository for the Securities
of such Series or if at any time the Depository for the Securities of such
Series shall no longer be eligible under Section 2.03, SBC shall appoint a
successor Depository with respect to the Securities of such Series. If a
successor Depository for the Securities of such Series is not appointed by SBC
within 90 days after SBC receives such notice or becomes aware of such
ineligibility, SBC's election pursuant to Section 2.02(15) shall no longer be
effective with respect to the Securities of such series and SBC will execute,
and the Trustee, upon receipt of the Order for the authentication and delivery
of definitive Securities of such Series, will authenticate and deliver,
Securities of such Series in definitive form in an aggregate principal amount
equal to the principal amount of the Global Security or Securities representing
such Series in exchange for such Global Security or Securities.
SBC may at any time and in its sole discretion determine that the
Securities of any series issued in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities. In such
event SBC will execute, and the Trustee, upon receipt of the Order for the
authentication and delivery of the definitive Securities of such Series, will
authenticate and deliver, Securities of such Series in definitive form and in an
aggregate principal amount equal to the principal amount of the Global Security
or Securities representing such Series in exchange for such Global Security or
Securities.
If (a) there shall have occurred and be continuing an Event of Default (as
defined in Section 6.01) or an event which, with the giving of notice or lapse
of time, or both, would constitute an Event of Default with respect to a Series
of Securities issued in the form of one or more Global Securities, or (b) if
specified by SBC pursuant to Section 2.02 with respect to a Series of
Securities, the Depository for such Series of Securities may surrender a Global
Security for such Series of Securities in exchange in whole or in part for
Securities of such Series in definitive form. Thereupon, SBC shall execute, and
the Trustee shall authenticate and deliver, without service closing charge:
-14-
20
(i) to each person specified by such Depository a new Security or
Securities of the same series, of any authorized denomination as requested
by such person in aggregate principal amount equal to and in exchange for
such person's beneficial interest in the Global Security; and
(ii) to such Depository a new Global Security in a denomination
equal to the difference, if any, between the principal amount of the
surrendered Global Security and the aggregate principal amount of
Securities delivered to Holders thereof.
In any exchange provided for in any of the preceding three paragraphs, SBC
will execute and the Trustee will authenticate and deliver Securities in
definitive registered form in authorized denominations.
Upon the exchange of a Global Security for Securities in definitive form,
such Global Security shall be canceled by the Trustee. Registered Securities
issued in exchange for a Global Security pursuant to this Section shall be
registered in such names and in such authorized denominations as the Depository
for such Global Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee.
SECTION 2.09 Replacement Securities.
(a) If a mutilated Security or a Security with a mutilated coupon
appertaining to it is surrendered to the Trustee, SBC shall issue and the
Trustee shall authenticate and deliver in exchange therefor a replacement
Registered Security, if such surrendered security was a Registered Security, or
a replacement Unregistered Security with coupons corresponding to the coupons
appertaining to the surrendered Security, if such surrendered Security was an
Unregistered Security, of the same Series and of like tenor, if the Trustee's
requirements are met.
(b) If the Holder of a Security claims that the Security or any coupon
appertaining thereto has been lost, destroyed or wrongfully taken, SBC shall
issue (and the Trustee shall authenticate) a replacement Registered Security of
like tenor, if such Holder's claim pertains to a Registered Security, or a
replacement Unregistered Security of like tenor with coupons corresponding to
the coupons appertaining to the lost, destroyed or wrongfully taken Unregistered
Security or the Unregistered Security to which such lost, destroyed or
wrongfully taken coupon appertains, if such Holder's claim pertains to an
Unregistered Security, of the same Series and of like tenor, if the Trustee's
requirements are met; provided, however, that the Trustee or SBC may require any
such Holder to provide to the Trustee and SBC security or indemnity sufficient
in the judgment of SBC and the Trustee to protect SBC, the Trustee, any Agent or
any authenticating agent from any loss which any of them may suffer if a
Security or any coupon
-15-
21
appertaining thereto is replaced. SBC may charge the party requesting a
replacement Security for its expenses in replacing a Security.
(c) Every replacement Security is an additional obligation of
SBC.
(d) The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities or coupons.
SECTION 2.10 Outstanding Securities.
(a) Securities outstanding at any time are all Securities authenticated by
the Trustee except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section as not outstanding.
(b) If a Security is replaced pursuant to Section 2.09, it ceases to be
outstanding until the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
(c) If a Paying Agent (other than SBC) holds on a redemption date or
maturity date money sufficient to pay all amounts due on Securities of any
Series on that date, then on and after that date all Securities of such Series
due on such date cease to be outstanding and interest on them ceases to accrue,
provided that if the Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made.
(d) A Security does not cease to be outstanding because SBC or an
Affiliate holds the Security.
(e) In determining whether the Holders of the requisite principal amount
of Securities of any Series have concurred in any direction, waiver or consent,
(i) the principal amount of an Original Issue Discount Security that shall be
deemed to be outstanding shall be the amount of the principal thereof that would
be due and payable as of the date of such determination upon acceleration of the
maturity thereof pursuant to Section 6.02 and (ii) the principal amount of a
Security denominated in a foreign currency or currencies shall be the U.S.
dollar equivalent, determined on the date of original issuance of such Security,
of the principal amount (or, in the case of an Original Issue Discount Security,
the U.S. dollar equivalent on the date of original issuance of such Security of
the amount determined as provided in (i) above) of such Security.
-16-
22
SECTION 2.11 Treasury Securities.
In determining whether the Holders of the requisite principal amount of
Securities of any Series have concurred in any direction, waiver or consent,
Securities of such Series owned by SBC or an Affiliate shall be disregarded,
except that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent, only Securities
of such Series which the Trustee knows are so owned shall be so disregarded.
Securities of such Series owned by SBC or which have been pledged in good faith
may be considered by the Trustee if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right to so act with respect to such Securities and
that the pledgee is not SBC or an Affiliate.
SECTION 2.12 Temporary Securities.
(a) Until definitive Registered Securities of any Series are ready for
delivery, SBC may prepare and execute and the Trustee shall authenticate
temporary Registered Securities of such Series. Temporary Registered Securities
of any Series shall be substantially in the form of definitive Registered
Securities of such Series but may have variations that SBC considers appropriate
for temporary Securities. Every temporary Registered Security shall be executed
by SBC and authenticated by the Trustee, and registered by the Registrar, upon
the same conditions, and with like effect, as a definitive Registered Security.
Without unreasonable delay, SBC shall prepare and the Trustee shall authenticate
definitive Registered Securities of the same Series and of like tenor in
exchange for temporary Registered Securities.
(b) Until definitive Unregistered Securities of any Series are ready for
delivery, SBC may prepare and execute and the Trustee shall authenticate one or
more temporary Unregistered Securities, which may have coupons attached or which
may be in the form of a single temporary global Unregistered Security of that
Series without coupons. The temporary Unregistered Security or Securities of any
Series shall be substantially in the form approved by or pursuant to a Board
Resolution and shall be delivered to one of the Paying Agents located outside
the United States or to such other person or persons as SBC shall direct against
such certifications as SBC may from time to time prescribe. The temporary
Unregistered Security or Securities of a Series shall be executed by SBC and
authenticated by the Trustee upon the same conditions, and with like effect, as
a definitive Unregistered Security of such Series, except as provided herein or
in the Board Resolution or supplemental indenture relating thereto. A temporary
Unregistered Security or Securities shall be exchangeable for definitive
Unregistered Securities of like tenor at the time and on the conditions, if any,
specified in the temporary Security.
Upon any exchange of a part of a temporary Unregistered Security of a
Series for definitive Unregistered Securities of such Series and of like tenor,
the temporary Unregistered Security shall be endorsed by the
-17-
23
Trustee or Paying Agent to reflect the reduction of its principal amount by an
amount equal to the aggregate principal amount of the definitive Unregistered
Securities of such Series and of like tenor so exchanged and endorsed.
SECTION 2.13 Cancellation.
SBC at any time may deliver Securities and coupons to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities and coupons surrendered to them for registration of transfer, for
exchange or for payment. The Trustee shall cancel all Securities and coupons
surrendered for registration of transfer, exchange, payment or cancellation and
may dispose of cancelled Securities and coupons as SBC directs; provided,
however, that any Unregistered Securities of a Series delivered to the Trustee
for exchange prior to maturity shall be retained by the Trustee for reissue as
provided herein or in the Securities of such Series. SBC may not issue new
Securities to replace Securities that it has paid or delivered to the Trustee
for cancellation, provided that the Trustee shall not be required to destroy
cancelled Securities but may be required to deliver such Securities to SBC upon
demand.
SECTION 2.14 Defaulted Interest.
If SBC defaults on a payment of interest on a Series of Securities, SBC
shall pay the defaulted interest as provided in such Securities or in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which such Securities may be listed and acceptable to the Trustee. With
respect to Registered Securities, the Trustee may pay the defaulted interest,
plus any interest payable on the defaulted interest, to the Holders of such
Registered Securities on a subsequent special record date. SBC shall fix the
record date and the payment date. At least 15 days before the record date SBC
shall mail to such Holders a notice that states the record date, the payment
date and the amount of interest to be paid.
SECTION 2.15 CUSIP Numbers.
SBC in issuing the Securities may use "CUSIP" numbers (if then generally
in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of
redemption as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers.
-18-
24
ARTICLE 3
REDEMPTION
SECTION 3.01 Notice to Trustee.
SBC may, with respect to any Series of Securities, reserve the right to
redeem and pay such Series of Securities or any part thereof, or may covenant to
redeem and pay the Series of Securities or any part thereof, before maturity at
such time and on such terms as provided for in such Securities. If a Series of
Securities is redeemable and SBC wants or is obligated to redeem all or part of
the Series of Securities pursuant to the terms of such Securities, it shall
notify the Trustee of the redemption date and the principal amount of the Series
of Securities to be redeemed. SBC shall give such notice at least 75 days before
the redemption date (or such shorter notice as may be acceptable to the
Trustee).
SECTION 3.02 Selection of Securities to be Redeemed.
If less than all the Securities of a Series are to be redeemed, the
Trustee, not more than 75 days prior to the redemption date, shall select the
Securities of the Series to be redeemed pro rata or by lot or in such other
manner as the Trustee shall deem fair and appropriate. The Trustee shall make
the selection from Securities of the Series that are outstanding and that have
not previously been called for redemption. Securities of the Series and portions
of them selected by the Trustee shall be in amounts of $1,000 or integral
multiples of $1,000 or, with respect to Securities of any Series issuable in
other denominations pursuant to Section 2.02(a)(8), in amounts equal to the
minimum principal denomination for each such Series and integral multiples
thereof. Provisions of this Indenture that apply to Securities of that Series
called for redemption also apply to portions of Securities of that Series called
for redemption. The Trustee shall promptly notify SBC in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.
SECTION 3.03 Notice of Redemption.
(a) At least 30 days but not more than 60 days before a redemption date,
SBC shall mail a notice of redemption by first-class mail to each Holder of
Registered Securities that are to be redeemed.
(b) If Unregistered Securities are to be redeemed, notice of redemption
shall be published in an Authorized Newspaper in each of The City of New York,
London and, if such Securities to be redeemed are listed on the Luxembourg Stock
Exchange, Luxembourg twice in different calendar weeks, the first publication to
be not less than 30 nor more than 60 days before the redemption date.
-19-
25
(c) All notices shall identify the Series of Securities to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) if less than all the outstanding Securities of a Series are
to be redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Securities to be
redeemed;
(4) the name and address of the Paying Agent;
(5) that Securities of the Series called for redemption and all
unmatured coupons, if any, appertaining thereto must be surrendered to the
Paying Agent to collect the redemption price; and
(6) that interest on Securities of the Series called for
redemption ceases to accrue on and after the redemption date.
At SBC's request, the Trustee shall give the notice of redemption in SBC's
name and at its expense.
SECTION 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed or published, Securities of a Series
called for redemption become due and payable on the redemption date at the
redemption price. Upon surrender to the Paying Agent of such Securities together
with all unmatured coupons, if any, appertaining thereto, such Securities shall
be paid at the redemption price plus accrued interest to the redemption date,
but installments of interest due on or prior to the redemption date will be
payable, in the case of Unregistered Securities, to the bearers of the coupons
for such interest upon surrender thereof and, in the case of Registered
Securities, to the Holders of such Securities of record at the close of business
on the relevant record dates.
SECTION 3.05 Deposit of Redemption Price.
On or before the redemption date, SBC shall deposit with the Trustee money
sufficient to pay the redemption price of and (unless the redemption date shall
be an interest payment date) interest accrued to the redemption date on all
Securities to be redeemed on that date.
-20-
26
SECTION 3.06 Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, SBC shall issue and
the Trustee shall authenticate for the Holder of that Security a new Security or
Securities of the same Series and like tenor and the same form in authorized
denominations equal in aggregate principal amount to the unredeemed portion of
the Security surrendered. If a Global Security is so surrendered, such new
Security so issued shall be a new Global Security.
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of Securities.
SBC shall pay or cause to be paid the principal of and interest on the
Securities on the dates and in the manner provided herein and in the Securities.
SBC shall pay interest on overdue principal of a Security of any Series at
the rate of interest (or, in the case of Original Issue Discount Securities,
Yield to Maturity) borne by the Securities of that Series, and, to the extent
lawful, it shall pay interest on overdue installments of interest at the same
rate.
SECTION 4.02 Reports by SBC.
SBC agrees:
(a) to file with the Trustee, within 15 days after SBC is required to file
the same with the SEC, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may from time to time by rules and regulations prescribe) which SBC
may be required to file with the SEC pursuant to section 13 or section 15(d) of
the Securities Exchange Act of 1934, as amended; or, if SBC is not required to
file information, documents or reports pursuant to either of such sections, then
to file with the Trustee and the SEC, in accordance with rules and regulations
prescribed from time to time by the SEC, such of the supplementary and periodic
information, documents and reports which may be required pursuant to section 13
of the Securities Exchange Act of 1934, as amended, in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations;
(b) to file with the Trustee and the SEC, in accordance with the rules and
regulations prescribed from time to time by the SEC, such additional
information, documents, and reports with respect to compliance by SBC with the
conditions and covenants provided for in this
-21-
27
Indenture as may be required from time to time by such rules and
regulations; and
(c) to transmit by mail to all Holders of Registered Securities, as the
names and addresses of such Holders appear on the register for each Series of
Securities, to such Holders of Unregistered Securities as have, within the two
years preceding such transmission, filed their names and addresses with the
Trustee for that purpose and to all Holders of Securities whose names and
addresses have been furnished to the Trustee pursuant to Section 2.07, within 30
days after the filing thereof with the Trustee, such summaries of any
information, documents and reports required to be filed by the SBC pursuant to
subsections (a) and (b) of this Section 4.02 as may be required by rules and
regulations prescribed from time to time by the SEC.
SECTION 4.03 Statement as to Compliance.
SBC will deliver to the Trustee annually, commencing March 1, 1998, a
certificate, from its principal executive officer, principal financial officer
or principal accounting officer, stating whether or not to the best knowledge of
the signer thereof the Company is in compliance (without regard to periods of
grace or notice requirements) with all conditions and covenants under this
Indenture, and if SBC shall not be in compliance, specifying such non-compliance
and the nature and status thereof of which such signer may have knowledge.
SECTION 4.04 Calculation of Original Issue Discount.
SBC shall file with the Trustee promptly at the end of each calendar year
a written notice specifying the amount of original issue discount (including
daily rates and accrual periods) accrued on outstanding Securities as of the end
of such year.
ARTICLE 5
SUCCESSORS
SECTION 5.01 When SBC May Merge, etc.
SBC may not consolidate with, or merge into, or be merged into, or
transfer or lease its properties and assets substantially as an entirety to, any
person, unless the person is a corporation organized under the laws of the
United States, any State thereof or the District of Columbia, the person assumes
by supplemental indenture all the obligations of SBC under this Indenture and
the Securities and any coupons appertaining thereto, shall have provided for
conversion or exchange rights in accordance with the terms of any Securities
contemplating conversion or exchange pursuant to Section 2.01(a)(14),
-22-
28
and, after giving effect thereto, no Default or Event of Default shall have
occurred and be continuing. The surviving, transferee or lessee corporation
shall be the successor to SBC and SBC, except in the case of a lease, shall be
relieved of all obligations under this Indenture and the Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTIONS 6.01 Events of Default.
An "Event of Default" occurs with respect to the Securities of any Series
if:
(1) SBC defaults in the payment of interest on any Security of that Series
when the same becomes due and payable and the Default continues for a period of
90 days;
(2) SBC defaults in the payment of the principal of any Security of that
Series when the same becomes due and payable at maturity, upon redemption or
otherwise;
(3) SBC fails to comply with any of its other agreements in the Securities
of that Series, or in any supplemental indenture under which the Securities of
that Series may have been issued or in the Indenture (other than an agreement
included solely for the benefit of Series of Securities other than that Series)
and the Default continues for the period and after the notice specified below;
(4) SBC pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against
it in an involuntary case,
(C) consents to the appointment of a Custodian of it or
for all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors; or
(5) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(A) is for relief against SBC in an involuntary case,
(B) appoints a Custodian of SBC or for all or
substantially all of its property, or
-23-
29
(C) orders the liquidation of SBC, and the order or decree
remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors. The term "Custodian" means any receiver,
trustee, assignee, liquidator or similar official under any Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the Trustee or
the Holders of at least 25% in principal amount of all the outstanding
Securities of that Series notify SBC (and the Trustee in the case of
notification by such Holders) of the Default and SBC does not cure the Default
within 90 days after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default".
Upon receipt by the Trustee of any Notice of Default pursuant to this
Section 6.01 with respect to Securities of a Series all or part of which is
represented by a Global Security, a record date shall be established for
determining Holders of outstanding Securities of such Series entitled to join in
such Notice of Default, which record date shall be at the close of business on
the day the Trustee receives such Notice of Default. The Holders on such record
date, or their duly designated proxies, and only such Persons, shall be entitled
to join in such Notice of Default, whether or not such Holders remain Holders
after such record date; provided, that unless Holders of at least 10% in
principal amount of the outstanding Securities of such Series, or their proxies,
shall have joined in such Notice of Default prior to the day which is 90 days
after such record date, such Notice of Default 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 Notice of Default identical to a
Notice of Default 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 6.01.
SECTION 6.02 Acceleration.
If an Event of Default occurs with respect to the Securities of any Series
and is continuing, the Trustee, by notice to SBC, or the Holders of at least 25%
in principal amount of all of the outstanding Securities of that Series, by
notice to SBC and the Trustee, may declare the principal (or, if any of the
Securities of that Series are Original Issue Discount Securities, such portion
of the principal amount of such Securities as may be specified in the terms
thereof) of, and any accrued interest on, all the Securities of that Series to
be due and payable. Upon such declaration, such principal (or, in the case of
Original Issue Discount Securities, such specified amount) and any accrued
interest shall be due and payable immediately. The Holders of a majority in
principal amount of all of the Securities of that Series, by notice to
-24-
30
SBC and the Trustee, may rescind such acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived except nonpayment of principal or
interest that have become due solely because of the acceleration.
Upon receipt by the Trustee of any declaration of acceleration, or
rescission thereof, with respect to Securities of a Series all or part of which
is represented by a Global Security, the Trustee shall establish a record date
for determining Holders of outstanding Securities of such Series entitled to
join in such declaration of acceleration, or rescission, as the case may be,
which record date shall be at the close of business on the date the Trustee
receives such declaration of acceleration, or rescission, as the case may be.
The Holders on such record date, or their duly designated proxies, and only such
persons, shall be entitled to join in such declaration of acceleration, or
rescission, as the case may be, whether or not such Holders remain Holders after
such record date; provided, that unless such declaration of acceleration, or
rescission, as the case may be, shall have become effective by virtue of the
requisite percentage having been obtained prior to the day which is 90 days
after such record date, such declaration of acceleration, or rescission, 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 declaration of acceleration, or rescission thereof, as the case
may be, that is identical to a declaration of acceleration, or rescission
thereof, which has been canceled pursuant to the proviso to the preceding
sentence, in which even a new record date shall be established pursuant to the
provisions of this Section 6.02.
SECTION 6.03 Other Remedies Available to Trustee.
(a) If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal of and interest
on the Securities of the Series that is in Default or to enforce the performance
of any provision of the Securities of that Series or this Indenture.
(b) The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. To the extent
permitted by law no remedy is exclusive of any other remedy and all available
remedies are cumulative.
-25-
31
SECTION 6.04 Waiver of Existing Defaults.
The Holders of a majority in principal amount of any Series of Securities
by notice to the Trustee may waive an existing Default with respect to that
Series and its consequences except a Default in the payment of principal of or
interest on any Security.
SBC may, but shall not be obligated to, fix a record date for the purpose
of determining the Persons entitled to waive any past default hereunder. If a
record date is fixed, the Holders on such record date, or their duly designated
proxies, and only such Persons, shall be entitled to waive any default
hereunder, whether or not such Holders remain Holders after such record date;
provided, that unless such majority in principal amount shall have waived such
default prior to the date which is 90 days after such record date, any such
waiver previously given shall automatically and without further action by any
Holder be canceled and of no further effect.
SECTION 6.05 Control by Majority.
The Holders of a majority in principal amount of the Securities of each
Series affected (with each such Series voting as a class) may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on it with respect to
Securities of that Series. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture or that is unduly
prejudicial to the rights of the Securityholders of that Series.
Upon receipt by the Trustee of any such direction with respect to
Securities of a Series all or part of which is represented by a Global Security,
the Trustee shall establish a record date for determining Holders of outstanding
Securities of such Series entitled to join in such direction, which record date
shall be at the close of business on the day the Trustee receives such
direction. The Holders on such record date, or their duly designated proxies,
and only such Persons, shall be entitled to join in such direction, whether or
not such Holders remain Holders after such record date; provided, that unless
such majority in principal amount shall have been obtained prior to the day
which is 90 days after such record date, such direction 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 direction identical to a
direction 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 6.05.
-26-
32
SECTION 6.06 Limitation on Suits by Securityholders.
A Securityholder may pursue a remedy with respect to this Indenture or the
Securities of any Series only if:
(1) the Holder gives to the Trustee written notice of a continuing Event
of Default with respect to Securities of that Series;
(2) the Holders of at least 25% in principal amount of the Securities of
that Series make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity satisfactory to
the Trustee against any loss, liability or expense to be, or which may be,
incurred by the Trustee in pursuing the remedy;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) during such 60-day period, the Holders of a majority in principal
amount of the Securities of that Series do not give the Trustee a direction
inconsistent with the request.
A Securityholder of any Series may not use this Indenture to prejudice the
rights of another Securityholder of that Series or any other Series or to obtain
a preference or priority over another Securityholder of that Series or any other
Series.
SECTION 6.07 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of principal of and (subject to Section
2.14) interest on the Security (whether at maturity or upon redemption), on or
after the respective due dates expressed in the Security, the right of any
Holder of a Security of a Series the terms of which provide for conversion or
exchange as contemplated in Section 2.01(a)(14) to have the Security be
converted or exchanged as so provided, and the right of any Holder of a coupon
to receive payment of (subject to Section 2.14) interest due as provided in such
coupon, or to bring suit for the enforcement of any such payment on or after
such respective dates or any such conversion or exchange right, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08 Collection Suits by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs with
respect to Securities of any Series and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against SBC for the
whole amount of the principal of and interest on Securities of that Series
remaining unpaid.
-27-
33
SECTION. 6.09 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable, and take any and all actions authorized under the
TIA, in order to have the claims of the Trustee and the Securityholders allowed
in any judicial proceedings relating to SBC (or any other obligor upon the
Securities), its creditors or its property.
SECTION 6.10 Priorities.
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Holders of Securities in respect of which or for the benefit of
which such money has been collected for amounts due and unpaid on such
Securities for principal and interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on such Securities for
principal and interest, respectively; and
THIRD: to SBC.
The Trustee may fix a record date (with respect to Registered Securities)
and payment date for any such payment to Holders of Securities.
SECTION 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable attorneys' fees, against any party
litigant in the suit, in the manner and to the extent provided in the TIA. This
Section does not apply to a suit by SBC, the Trustee, a Holder pursuant to
Section 6.07, or a Holder or Holders of more than 10% in principal amount of the
Securities of any Series.
-28-
34
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties of Trustee.
(a) The duties and responsibilities of the Trustee shall be as provided by
the TIA. If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of its rights and powers under this Indenture, and use the
same degree of care and skill in their exercise, as a prudent man would exercise
or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) Subject to the provisions of the TIA, the Trustee need
perform only those duties that are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into this
Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(1) This paragraph does not limit the effect of
paragraph (b) of this Section.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
-29-
35
(e) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree with SBC. Money held in trust by the Trustee
need not be segregated from other funds except to the extent required by law.
(g) Except as expressly provided herein, no provision of this Indenture
shall require the Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
SECTION 7.02 Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and
to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult with
counsel of its selection after consultation with SBC or require an Officers'
Certificate or an Opinion of Counsel. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on a Board
Resolution, an Officers' Certificate, an Opinion of Counsel or the advice of
counsel selected in consultation with SBC.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction.
-30-
36
SECTION 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with SBC or an Affiliate with
the same rights it would have if it were not Trustee. Any Agent may do the same
with like rights. However, the Trustee is subject to Sections 7.10 and 7.11.
SECTION 7.04 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Securities, shall not be accountable for SBC's use of the
proceeds from the Securities and shall not be responsible for any statement in
the Securities other than its certificate of authentication.
SECTION 7.05 Notice of Defaults.
If a Default occurs and is continuing with respect to the Securities of
any Series and if it is known to the Trustee, the Trustee shall mail to each
Holder of a Security of that Series entitled to receive reports pursuant to
Section 4.02(c) (and, if Unregistered Securities of that Series are outstanding,
shall cause to be published at least once in an Authorized Newspaper in each of
The City of New York, London and, if Securities of that Series are listed on the
Luxembourg Stock Exchange, Luxembourg) notice of the Default as and to the
extent provided by the TIA. Except in the case of a Default in payment on the
Securities of any Series, the Trustee may withhold the notice if and so long as
a committee of its Responsible Officers in good faith determines that
withholding such notice is in the interests of Securityholders of that Series.
SECTION 7.06 Reports by Trustee to Holders.
(a) Within 60 days after each anniversary date of the first issue of a
Series of Securities, the Trustee shall mail to each Securityholder of that
Series entitled to receive reports pursuant to Section 4.02(c) a brief report,
dated as of such date, that complies with TIA Section 313(a). The Trustee also
shall comply with TIA Section 313(b)(2).
(b) At the time that it mails such a report to Securityholders of any
Series, the Trustee shall file a copy of that report with the SEC and with each
stock exchange on which the Securities of that Series are listed. SBC shall
provide written notice to the Trustee when the Securities of any Series are
listed on any stock exchange.
-31-
37
SECTION 7.07 Compensation and Indemnity.
(a) SBC shall pay to the Trustee from time to time such compensation as
SBC and the Trustee shall from time to time agree in writing for all services
rendered by the Trustee hereunder. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. SBC shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it in connection with the performance of its duties under this
Indenture. Such expenses shall include the reasonable compensation and
out-of-pocket expenses of the Trustee's agents and counsel.
(b) SBC shall indemnify each of the Trustee or any successor Trustee for,
and hold the Trustee harmless against, any and all loss, damage, claims,
liability or expense, including taxes (other than taxes based upon, measured by
or determined by the income of the Trustee), arising out of or in connection
with the acceptance or administration of the trust or trusts hereunder,
including the reasonable costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of the
Trustee's powers or duties hereunder, except to the extent that such loss,
damage, claim, liability or expense is due to the Trustee's own negligence or
bad faith. The Trustee shall notify SBC promptly of any claim for which it may
seek indemnity. SBC shall defend the claim and the Trustee shall cooperate in
the defense. The Trustee may have separate counsel and SBC shall pay the
reasonable fees and expenses of such counsel. SBC need not pay for any
settlement made without its consent.
(c) SBC need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee through its negligence or bad faith.
(d) To secure the payment obligations of SBC pursuant to this Section, the
Trustee shall have a lien prior to the Securities of any Series on all money or
property held or collected by the Trustee, except that held in trust to pay
principal of and interest on particular Securities of a Series.
(e) If the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(4) or (5) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
(f) The provisions of this Section 7.07 shall survive termination of this
Indenture and the resignation or removal of the Trustee.
SECTION 7.08 Replacement of Trustee.
(a) The resignation or removal of the Trustee and the appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
-32-
38
(b) The Trustee may resign with respect to the Securities of any Series by
so notifying SBC. The Holders of a majority in principal amount of the
Securities of any Series may remove the Trustee with respect to that Series by
so notifying the Trustee and SBC. SBC may remove the Trustee with respect to
Securities of any Series if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason with respect to Securities of any Series, SBC
shall promptly appoint a successor Trustee for such Series. Within one year
after a successor Trustee with respect to the Securities of any Series takes
office the Holders of a majority in principal amount of Securities of that
Series may appoint a successor Trustee with respect to the Securities of that
Series to replace the successor Trustee appointed by SBC.
(d) If a successor Trustee with respect to the Securities of any Series
does not take office within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee, SBC or the Holders of at least 10% in principal
amount of the Securities of the applicable Series may petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such Series.
(e) If the Trustee with respect to the Securities of any Series fails to
comply with Section 7.10, any Securityholder of the applicable Series may
petition any court of competent jurisdiction for the removal of such Trustee and
the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and SBC. Thereupon, the resignation or
removal of the retiring Trustee for any Series of Securities shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the retiring Trustee with respect to all Series of Securities for
which the successor Trustee is to be acting as Trustee under this Indenture. The
retiring Trustee shall promptly transfer all property held by it as Trustee with
respect to such Series of Securities to the successor Trustee subject to the
lien provided for in Section 7.07. SBC shall give notice of each appointment of
a successor Trustee for any Series of Securities by mailing written notice of
such event by first-class mail to the Holders of Securities of such Series
entitled to receive reports pursuant to Section 4.03(c) and, if any Unregistered
Securities are outstanding, by publishing notice of such event once in an
Authorized Newspaper in each of The City of New York, London, and, if
-33-
39
Securities of that Series are listed on the Luxembourg Stock Exchange,
Luxembourg.
(g) All provisions of this Section 7.08 except subparagraphs (b)(1), (e)
and (h) and the words "subject to the lien provided for in Section 7.07" in
subparagraph (f) shall apply also to any Paying Agent located outside the United
States and its possessions and required by Section 2.04.
(h) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) Series, SBC, the retiring
Trustee and such successor Trustee shall execute and deliver a supplemental
indenture wherein such successor Trustee shall accept such appointment and which
(1) shall contain such provisions as shall be necessary or desirable to transfer
and confirm to, and to vest in, such successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of that
or those Series to which the appointment of such successor Trustee relates, (2)
if the retiring Trustee is not retiring with respect to all Securities, shall
contain such provisions as shall be deemed necessary or desirable to confirm
that all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those Series as to which the retiring
Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or
in such supplemental indenture shall constitute such Trustees co-trustees of the
same trust and that each such Trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such Trustee.
SECTION 7.09 Successor Trustee, Agents by Merger, etc.
If the Trustee or any Agent consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business assets to,
another corporation, the successor corporation, without any further act, shall
be the successor Trustee or Agent, as the case may be.
SECTION 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee with respect to each Series of
Securities which satisfies the requirements of TIA Section 310(a)(1). The
Trustee shall always have a combined capital and surplus of at least
$100,000,000, as set forth in its most recent published annual report of
condition. If the Trustee has or shall acquire a conflicting interest within the
meaning of the TIA, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the TIA and this Indenture. To the extent permitted by the TIA, the Trustee
shall not be
-34-
40
deemed to have a conflicting interest by virtue of being a trustee under this
Indenture with respect to Securities of more than one Series or a trustee under
all indentures now or hereafter existing pursuant to which indenture securities
have been issued on which SBC is an obligor and which may be excluded under the
proviso of TIA Section 310(b)(1).
SECTION 7.11 Preferential Collection of Claims Against SBC.
If and when the Trustee shall be or become a creditor of SBC (or any other
obligor upon the Securities), the Trustee shall be subject to the provisions of
the TIA regarding the collection of claims against SBC (or any such other
obligor).
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01 Termination of SBC's Obligations.
(a) SBC reserves the right to terminate all of its obligations under (i)
this Indenture and the Securities, or (ii) the Securities of any Series if SBC
irrevocably deposits in trust with the Trustee money or U.S. Government
Obligations sufficient to pay, when due, the principal of and any interest on
all the Securities or all the Securities of that Series, as the case may be, to
maturity or redemption and if all other conditions set forth in the Securities
of that Series are met. However, SBC's obligations in Sections 2.04, 2.05, 2.06,
2.07, 2.08, 2.09, 2.15, 4.01, 7.07, 7.08, 8.03 and 8.04 shall survive until the
Securities are no longer outstanding. Thereafter SBC's obligations in Sections
7.07, 8.03 and 8.04 shall survive. Unless otherwise provided in the terms of
Securities of a Series that are convertible or exchangeable as contemplated in
Section 2.01(a)(14), SBC shall not be entitled to terminate its obligations
under the Securities of that Series pursuant to this Section 8.01.
(b) Before or after a deposit SBC may make arrangements satisfactory to
the Trustee for the redemption of Securities at a future date in accordance with
Article 3.
(c) After a deposit by SBC in accordance with this Section in respect of
the Securities of a Series, the Trustee upon request shall acknowledge in
writing the discharge of SBC's obligations under the Securities of the Series in
respect of which the deposit has been made and this Indenture with respect to
the Securities of that Series except for those surviving obligations specified
above.
(d) In order to have money available on a payment date to pay
principal of and interest on the Securities of any Series, the U.S.
Government Obligations shall be payable as to principal or interest on
-35-
41
or before such payment date in such amounts as will provide the necessary money.
(e) "U.S. Government Obligations" means:
(i) direct obligations of the United States of America for the
payment of which the full faith and credit of the United States of America
are pledged; or
(ii) obligations of a person controlled or supervised by and
acting as an agency or instrumentality of the United States of America
pursuant to authority granted by the Congress of the United States of
America the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America;
provided, however, that U.S. Government Obligations shall not be
callable at the issuer's option.
SECTION 8.02 Application of Trust Money.
The Trustee shall hold in trust all money or U.S. Government Obligations
deposited with it pursuant to Section 8.01. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal of and interest on
the Securities of each Series in respect of which the deposit shall have been
made.
SECTION 8.03 Repayment to SBC.
(a) The Trustee and the Paying Agent shall promptly pay to SBC upon
request any excess money or securities held by them at any time.
(b) The Trustee and the Paying Agent shall pay to SBC upon request any
money held by them for the payment of principal or interest that remains
unclaimed for two years after such principal or interest became due. After
payment to SBC, Securityholders entitled to the money must look to SBC for
payment as general creditors unless an applicable abandoned property law
designates another person.
SECTION 8.04 Indemnity for Government Obligations.
SBC shall pay and shall indemnify the Trustee and each Securityholder of
each Series in respect of which the deposit shall have been made against any
tax, fee or other charge imposed on or assessed against deposited U.S.
Government Obligations or the principal and interest received on such
obligations.
-36-
42
ARTICLE 9
AMENDMENTS AND WAIVERS
SECTION 9.01 Without Consent of Holders.
SBC and the Trustee may enter into one or more supplemental indentures
without consent of any Securityholder for any of the following purposes:
(1) to cure any ambiguity, defect or inconsistency herein or in
the Securities of any Series;
(2) to provide for the issuance of and establish the form and terms and
conditions of Securities of any Series as provided in Section 2.02, and to
establish the form of any certifications required to be furnished pursuant to
the terms of this Indenture or any Series of Securities;
(3) to secure the Securities pursuant to Section 4.02;
(4) to comply with Section 5.01 or 5.02;
(5) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(6) to add to the rights of the Holders of any Series of
Securities or to surrender any right or power herein conferred on SBC;
(7) to make provision with respect to the conversion or exchange rights of
Holders pursuant to the requirements of the terms of Securities of a Series that
is convertible or exchangeable as contemplated in Section 2.01(a)(14); or
(8) to make any change that does not adversely affect the rights
of any Securityholder.
SECTION 9.02 With Consent of Holders.
(a) With the written consent of the Holders of a majority in principal
amount of the outstanding Securities of each Series affected by such
supplemental indenture (with each Series voting as a class), SBC and the Trustee
may enter into a supplemental indenture to add any provisions to or to change or
eliminate any provisions of this Indenture or of any supplemental indenture or
to modify, in each case in any manner not covered by Section 9.01, the rights of
the Securityholders of each such Series. The Holders of a majority in principal
amount of the outstanding Securities of each Series affected by such waiver
(with each Series voting as a class), by notice to the Trustee, may waive
compliance by SBC with any provision of this Indenture, any supplemental
-37-
43
indenture or the Securities of any such Series except a Default in the payment
of the principal of or interest on a Security. However, without the consent of
each Securityholder affected, an amendment or waiver may not:
(1) reduce the amount of Securities whose Holders must
consent to an amendment or waiver;
(2) reduce the rate of or change the time for payment of
interest on any Security;
(3) reduce the principal of or change the fixed maturity
of any Security;
(4) waive a Default in the payment of the principal of
or interest on any Security;
(5) make any Security payable in currency other than
that stated in the Security;
(6) adversely affect the right to convert or exchange, as
provided in the terms thereof, any Security that is convertible or
exchangeable as contemplated in Section 2.01(a)(14); or
(7) make any change in Section 6.04, 6.07 or 9.02(a)
(third sentence).
(b) SBC may, but shall not be obligated to, fix a record date for the
purpose of determining the Persons entitled to consent to any indenture
supplemental hereto. If a record date is fixed, the Holders on such record date,
or their duly designated proxies, and only such Persons, shall be entitled to
consent to such supplemental indenture, whether or not such Holders remain
Holders after such record date; provided, that unless such consent shall have
become effective by virtue of the requisite percentage having been obtained
prior to the date which is 90 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
canceled and of no further effect.
(c) It is not necessary under this Section 9.02 for the Security- holders
to consent to the particular form of any proposed supplemental indenture, but it
is sufficient if they consent to the substance thereof.
(d) Promptly after the execution by SBC and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 9.02, SBC
shall transmit by mail a notice, setting forth in general terms the substance of
such supplemental indenture, to all Holders of Registered Securities, as the
names and addresses of such Holders appear on the register for each Series of
Securities, and to such Holders of Unregistered Securities as are entitled to
receive reports pursuant to
-38-
44
Section 4.02(c). Any failure of SBC to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental indenture.
SECTION 9.03 Compliance with Trust Indenture Act.
Every amendment to this Indenture or the Securities of one or more Series
shall be set forth in a supplemental indenture that complies with the TIA as
then in effect.
SECTION 9.04 Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Security is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security if the Trustee receives the
notice of revocation before the date the amendment or waiver becomes effective.
After an amendment or waiver becomes effective, it shall bind every
Securityholder of each Series affected by such amendment or waiver.
SECTION 9.05 Notation on or Exchange of Securities.
The Trustee may place an appropriate notation about an amendment or waiver
on any Security of any Series thereafter authenticated. SBC in exchange for
Securities of that Series may issue and the Trustee shall authenticate new
Securities of that Series that reflect the amendment or waiver.
SECTION 9.06 Trustee Protected.
The Trustee need not sign any supplemental indenture that is reasonably
likely to adversely affect its rights.
SECTION 9.07 Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modification thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and shall be fully protected in relying upon, an Opinion of Counsel stating that
the execution of such supplemental indenture is authorized or permitted by this
Indenture.
-39-
45
ARTICLE 10
MISCELLANEOUS
SECTION 10.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision of the TIA that is required under the TIA to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the TIA which may be so
modified or excluded, the latter provision shall be deemed to apply to this
Indenture as so modified or to be excluded, as the case may be.
SECTION 10.02 Notices.
(a) Any notice or communication by SBC or the Trustee to the other is duly
given if in writing and delivered in person or mailed by first-class mail:
if to SBC to:
SBC Communications Inc.
175 E. Houston Street
San Antonio, Texas 78205-4105
Attention: Assistant Treasurer-Corporate Finance
if to the Trustee to:
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
(b) SBC or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
(c) Any notice or communication to Holders of Securities entitled to
receive reports pursuant to Section 4.02(c) shall be mailed by first-class mail
to the addresses for Holders of Registered Securities shown on the register kept
by the Registrar and to addresses filed with the Trustee for other Holders.
Failure to so mail a notice or communication or any defect in such notice or
communication shall not affect its sufficiency with respect to other Holders of
Securities of that or any other Series entitled to receive notice.
-40-
46
(d) If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
(e) If SBC mails a notice or communication to Securityholders, it shall
mail a copy to the Trustee and to each Agent at the same time.
(f) If it shall be impractical in the opinion of the Trustee or SBC to
make any publication of any notice required hereby in an Authorized Newspaper,
any publication or other notice in lieu thereof which is made or given with the
approval of the Trustee shall constitute a sufficient publication of such
notice.
(g) All other notices or communications will be in writing.
(h) All notices or other communications given to the Trustee shall be
effective when actually received by the Trustee.
SECTION 10.03 Communication by Holders with Other Holders.
The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the TIA.
SECTION 10.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by SBC to the Trustee to take any action
under this Indenture, SBC shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 10.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall comply with the requirements of
the TIA and shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition and related definitions;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
-41-
47
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
condition or covenant has been complied with.
SECTION 10.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a meeting of
Securityholders of one or more Series. The Paying Agent or Registrar may make
reasonable rules and set reasonable requirements for its functions.
SECTION 10.07 Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open. If a payment date or a date for
conversion or exchange is a Legal Holiday at a place of payment, conversion or
exchange, then such payment, conversion or exchange may be made at such place on
the next succeeding day this is not a Legal Holiday with the same force and
effect as if made on such date, and no interest shall accrue for the intervening
period.
SECTION 10.08 Governing Law.
The laws of the State of New York shall govern this Indenture, the
Securities and any coupons appertaining thereto without regard to principles of
conflicts of laws.
SECTION 10.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of SBC or any Affiliate. No such indenture, loan or debt
agreement may be used to interpret this Indenture.
SECTION 10.10 No Recourse Against Others.
No director, officer, employee or stockholder, as such, of SBC shall have
any liability for any obligation of SBC under the Securities or the Indenture or
for any claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
SECTION 10.11 Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more
-42-
48
instruments of substantially similar tenor signed by such Holders in person or
by an agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to SBC.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of Holders signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Indenture and conclusive in favor of the Trustee and SBC, 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 provided 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
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 the Trustee deems sufficient.
(c) The ownership of Unregistered Securities may be proved by the
production of such Unregistered Securities or by a certificate executed by any
trust company, bank, banker or other depository, wherever situated, if such
certificate shall be deemed by the Trustee to be satisfactory, showing that at
the date therein mentioned such Person has on deposit with such depository, or
exhibited to it, the Unregistered Securities therein described; or such facts
may be proved by the certificate or affidavit of the Person holding such
Unregistered Securities, if such certificate or affidavit is deemed by the
Trustee to be satisfactory. The Trustee and SBC may assume that such ownership
of any Unregistered Security continues until (i) another such certificate or
affidavit bearing a later date issued in respect of the same Unregistered
Security is produced, (ii) such Unregistered Security is produced to the Trustee
by some other Person, (iii) such Unregistered Security is surrendered in
exchange for a Registered Security or (iv) such Unregistered Security is no
longer outstanding. The ownership of Unregistered Securities may also be proved
in any other manner which the Trustee deems sufficient.
(d) The ownership of Registered Securities shall be proved by the
Registrar.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of the
same Security and the holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or
-43-
49
suffered to be done by the Trustee or SBC in reliance thereon, whether or not
notation of such action is made upon such Security.
SECTION 10.12 Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one instrument.
SBC COMMUNICATIONS INC.
By: /s/Donald E. Kiernan
----------------------
Title: Senior Vice President,
Treasuer and Chief
Financial Officer
(SEAL)
ATTEST:
/s/Wayne Wirtz
- ---------------------------
Title: Assistant Secretary
THE BANK OF NEW YORK
By: /s/Remo Reale
----------------------------
Title: Assistant Vice President
(SEAL)
ATTEST:
/s/Mary LaGumina
- -------------------------------
Title: Assistant Vice President
-44-