Exhibit 4.3
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SECOND SUPPLEMENTAL INDENTURE
Dated as of February 10, 1998
Between
TELEPHONE AND DATA SYSTEMS, INC.
and
THE FIRST NATIONAL BANK OF CHICAGO
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ARTICLE I
DEFINITIONS
Section 1.1. Definition of Terms............................2
Section 1.2. Interpretation.................................3
ARTICLE II
GENERAL TERMS AND CONDITIONS OF
THE SUBORDINATED DEBENTURES
Section 2.1. Designation and Principal Amount...............3
Section 2.2. Maturity.......................................3
Section 2.3. Form and Payment...............................3
Section 2.4. Global Subordinated Debenture..................4
Section 2.5. Interest.......................................5
ARTICLE III
REDEMPTION OF THE SUBORDINATED DEBENTURES
Section 3.1. Tax Event Redemption...........................6
Section 3.2. Optional Redemption by Company.................6
Section 3.3. No Sinking Fund................................7
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
Section 4.1. Extension of Interest Payment Period...........7
Section 4.2. Notice of Extension............................7
ARTICLE V
EXPENSES
Section 5.1. Payment of Expenses............................8
ARTICLE VI
SUBORDINATION
Section 6.1. Agreement to Subordinate.......................9
Section 6.2. Default on Senior Indebtedness.................9
Section 6.3. Liquidation; Dissolution;
Bankruptcy..................................10
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Section 6.4. Subrogation...................................11
Section 6.5. Trustee to Effectuate
Subordination...............................12
Section 6.6. Notice by the Company.........................12
Section 6.7. Rights of the Trustee; Holders of Senior
Indebtedness................................12
Section 6.8. Subordination May Not Be
Impaired....................................13
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
Section 7.1. Listing on Exchange...........................13
ARTICLE VIII
FORM OF SUBORDINATED DEBENTURE
Section 8.1. Form of Subordinated Debenture................14
ARTICLE IX
ORIGINAL ISSUE OF SUBORDINATED DEBENTURES
Section 9.1. Original Issue of Subordinated
Debentures..................................21
ARTICLE X
MISCELLANEOUS
Section 10.1. Ratification of Indenture....................21
Section 10.2. Trustee Not Responsible for
Recitals...................................21
Section 10.3. Governing Law................................21
Section 10.4. Separability.................................21
Section 10.5. Counterparts.................................22
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THIS SECOND SUPPLEMENTAL INDENTURE, dated as of February 10,
1998 (the "Second Supplemental Indenture"), between Telephone and Data Systems,
Inc., an Iowa corporation (the "Company"), and The First National Bank of
Chicago, a national banking association, duly organized and existing
under the laws of the United States, as trustee (the "Trustee") under the
Indenture dated as of October 15, 1997 between the Company and the Trustee (the
"Indenture").
W I T N E S S E T H:
WHEREAS, the Company executed and delivered the
Indenture to the Trustee to provide for the future issuance of the
Company's unsecured subordinated debt securities, to be issued from time to time
in one or more series as might be determined by the Company under the Indenture,
in an unlimited aggregate principal amount which may be authenticated and
delivered as provided in the Indenture; and
WHEREAS, pursuant to the terms of the Indenture,
the Company desires to provide for the establishment of a new series of
its Debt Securities to be known as its 8.04% Junior Subordinated Deferrable
Interest Debentures due March 31, 2038 (the "Subordinated Debentures"), the form
and substance of which and the terms, provisions and conditions thereof to be
set forth as provided in the Indenture and this Second Supplemental Indenture;
and
WHEREAS, TDS Capital II, a Delaware statutory
business trust (the Trust"), has offered to the public $150,000,000
aggregate stated liquidation amount of its Trust Originated Preferred Securities
(the "Preferred Securities") and has offered to the Company $4,640,000 aggregate
stated liquidation amount of its Trust Originated Common Securities (the "Common
Securities"), such Preferred Securities and Common Securities representing
undivided beneficial interests in the assets of the Trust, and proposes to
invest the proceeds from such offering in $154,640,000 aggregate principal
amount of the Subordinated Debentures; and
WHEREAS, the Company has requested the
Trustee to execute and deliver this Second Supplemental Indenture, and all
requirements necessary to make this Second Supplemental Indenture a valid
instrument, in accordance with its terms, and to make the Subordinated
Debentures, when executed by the Company and authenticated and delivered by the
Trustee, the valid obligations of the Company, have been performed, and the
execution and delivery of this Second Supplemental Indenture has been duly
authorized in all respects;
NOW, THEREFORE, in consideration of the
purchase and acceptance of the Subordinated Debentures by the holder thereof,
and for the purpose of setting forth, as provided in the Indenture, the form and
substance of the Subordinated Debentures and the terms, provisions and
conditions thereof, the Company covenants and agrees with the Trustee as
follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definition of Terms. Unless the
context otherwise requires, (a) a term defined in the Indenture has the same
meaning when used in this Second Supplemental Indenture; (b) a term defined
anywhere in this Second Supplemental Indenture has the same meaning throughout;
and (c) the following terms have the meanings given to them in the Declaration:
(i) Clearing Agency; (ii) Delaware Trustee; (iii) Redemption Tax Opinion; (iv)
Preferred Security Certificate; (v) Property Trustee; (vi) Pro Rata; (vii)
Regular Trustees; and (viii) Tax Event.
In addition, the following terms have the following
respective meanings:
Declaration:
The term "Declaration" shall mean the
Amended and Restated Declaration of Trust of TDS Capital II, a Delaware business
trust, dated as of February 10, 1997.
Maturity Date:
The term "Maturity Date" shall mean the date
on which the Subordinated Debentures mature and on which the principal shall be
due and payable together with all accrued and unpaid interest thereon including
Compounded Interest (as defined in Section 4.1) and Additional Interest (as
defined in Section 2.5(c)), if any.
Senior Indebtedness:
The term "Senior Indebtedness" shall mean (i)
any payment in respect of (A) indebtedness of the Company for money borrowed and
(B) indebtedness evidenced by securities, debentures, bonds, notes or other
similar instruments issued by the Company; (ii) all capital lease obligations of
the Company; (iii) all obligations of the Company issued or assumed as the
deferred purchase price of property, all conditional sale obligations of the
Company and all of its obligations under any title retention agreement (but
excluding trade accounts payable arising in the ordinary course of business);
(iv) all obligations of the Company for reimbursement on any letter of credit,
banker's acceptance, security purchase facility or similar credit transaction;
(v) all obligations of the type referred to in clauses (i) through (iv) of other
Persons for the payment of which the Company is responsible or liable as
obligor, guarantor or otherwise; and (vi) all obligations of the type referred
to in clauses (i) through (v) of other Persons secured by any lien on any
property or asset of the Company (whether or not such obligation is assumed by
the Company), except for (1) the Subordinated Debentures and any other
indebtedness that is by its terms subordinated to or pari passu with the
Subordinated Debentures, as the case may be, including all other debt securities
and guarantees in respect of those debt securities, issued to any other trusts,
partnerships or any other entity affiliated with the Company which is a
financing vehicle of the Company ("Financing Entity") in connection with an
issuance of preferred securities by such Financing Entity or other securities
which rank pari passu with, or junior to, the Preferred Securities, and (2) any
indebtedness between or among the Company and its Affiliates.
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Section 1.2. Interpretation. Each definition in
this Second Supplemental Indenture includes the singular and the plural, and
references to the neuter gender include the masculine and feminine where
appropriate. Terms which relate to accounting matters shall be interpreted in
accordance with generally accepted accounting principles in effect from time to
time. References to any statute mean such statute as amended at the time and
include any successor legislation. The word "or" is not exclusive, and the words
"herein," "hereof" and "hereunder" refer to this Second Supplemental Indenture
as a whole. The headings to the Articles and Sections are for convenience of
reference and shall not affect the meaning or interpretation of this Second
Supplemental Indenture. References to Articles and Sections mean the Articles
and Sections of this Second Supplemental Indenture unless otherwise specified.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF
THE SUBORDINATED DEBENTURES
Section 2.1. Designation and Principal Amount.
There is hereby authorized a series of Debt Securities designated the
"8.04% Junior Subordinated Deferrable Interest Debentures due March 31, 2038,"
limited in aggregate principal amount to $154,640,000, which amount shall be as
set forth in any written order of the Company for the authentication and
delivery of such Debt Securities pursuant to Section 2.04 of the Indenture.
Section 2.2. Maturity. The Maturity Date will
be the Stated Maturity Date provided that the Company may at its option at any
time prior to the Stated Maturity Date extend the Maturity Date to a date not
later than March 31, 2047; provided, however, that at the time such election is
made and at the effective time of such extension (as specified by the Company)
(i) the Company is not in bankruptcy, otherwise insolvent or in liquidation,
(ii) the Company is not in default in the payment of any interest or principal
on the Subordinated Debentures, and (iii) in the case of Subordinated Debentures
held by the Trust, the Trust is not in arrears on payments of Distributions and
no deferred Distributions are accumulated. In the event the Company elects to
extend the stated maturity of the Subordinated Debentures, it shall give notice
of any such change to the Trustee, and the Trustee shall give notice of such
extension to the Holders of the Subordinated Debentures, not more than 90 and
not less than 30 days prior to the effective time of such extension.
Section 2.3. Form and Payment. Except as
provided in Section 2.4, the Subordinated Debentures shall be issued in fully
registered certificated form without interest coupons. Principal and interest on
the Subordinated Debentures issued in certificated form will be payable, the
transfer of such Subordinated Debentures will be registrable and such
Subordinated Debentures will be exchangeable for Subordinated Debentures bearing
identical terms and provisions at the office or agency of the Trustee in
Chicago, Illinois, provided, however, that payment of interest may be made at
the option of the Company by check mailed to the registered holder at such
address as shall appear in the Security Register or by wire transfer to such
account as may have been appropriately
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designated by such holder. Notwithstanding the foregoing, so long as the
registered holder of any Subordinated Debentures is the Property Trustee, the
payment of the principal of and interest (including Compounded Interest and
Additional Interest, if any) on such Subordinated Debentures held by the
Property Trustee will be made at such place and to such account as may be
designated by the Property Trustee. The Subordinated Debentures will be
denominated in U.S. dollars and payments of principal and interest on the
Subordinated Debentures shall be made in U.S. dollars.
Section 2.4. Global Subordinated Debenture. In
connection with the dissolution of the Trust:
(a) the Subordinated Debentures in certificated
form may be presented to the Trustee by the Property Trustee in exchange
for a Global Security in an aggregate principal amount equal to
the aggregate principal amount of the Subordinated Debentures so
presented, to be registered in the name of the Depositary, or its
nominee, and delivered by the Trustee to the Depositary for
crediting to the accounts of its participants pursuant
to the instructions of the Regular Trustees. The Company, upon
any such presentation, shall execute a Global Security in such aggregate
principal amount and deliver the same to the Trustee for authentication and
delivery in accordance with the Indenture and this Second Supplemental
Indenture. Payments on the Subordinated Debentures issued as a Global
Security will be made to the Depositary; and
(b) if any Preferred Securities are held in non
book-entry certificated form, the Subordinated Debentures in
certificated form may be presented to the Trustee by the Property
Trustee and any Preferred Security Certificate which represents
Preferred Securities other than Preferred Securities held by the
Clearing Agency or its nominee ("Non Book-Entry Preferred Securities")
will be deemed to represent beneficial interests in Subordinated
Debentures presented to the Trustee by the Property Trustee having an
aggregate principal amount equal to the aggregate stated
liquidation amount of the Non Book-Entry Preferred Securities until
such Preferred Security Certificates are presented to the Security
Registrar for transfer or reissuance at which time such Preferred
Security Certificates will be cancelled and a Subordinated Debenture,
registered in the name of the holder of the Preferred Security
Certificate or the transferee of the holder of such Preferred Security
Certificate,
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as the case may be, with an aggregate principal amount equal to the
aggregate stated liquidation amount of the Preferred Security
Certificate cancelled, will be executed by the Company and delivered
to the Trustee for authentication and delivery in accordance with the
Indenture and this Second Supplemental Indenture. On issue of such
Subordinated Debentures, Subordinated Debentures with an equivalent
aggregate principal amount that were presented by the Property Trustee
to the Trustee will be deemed to have been cancelled.
Section 2.5. Interest.
(a) Each Subordinated Debenture will bear
interest at the rate of 8.04% per annum (the "Coupon Rate") from the original
date of issuance until the principal thereof becomes due and payable, and on any
overdue principal and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
Coupon Rate, compounded quarterly, payable (subject to the provisions of Article
IV) quarterly in arrears on March 31, June 30, September 30 and December 31 of
each year (each, an "Interest Payment Date"), commencing on March 31, 1998, to
the Person in whose name such Subordinated Debenture or any predecessor
Subordinated Debenture is registered, at the close of business on the regular
record date for such interest installment, which shall be the close of business
on the Business Day next preceding that Interest Payment Date. If pursuant to
the provisions of Section 2.11(c) of the Indenture the Subordinated Debentures
are no longer represented by a Global Security, the Company may select a regular
record date for such interest installment which shall be any date at least
fifteen days before an Interest Payment Date.
(b) The amount of interest payable for any
period will be computed on the basis of a 360-day year of twelve 30-day months.
In the event that any date on which interest is payable on the Subordinated
Debentures is not a Business Day, then payment of interest payable on such date
will be made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day is in the next succeeding calendar year, such payment shall be made
on the immediately preceding Business Day, in each case with the same force and
effect as if made on such date. The amount of interest payable for any period
shorter than a full quarterly period for which interest is computed, will be
computed on the basis of the actual number of days elapsed in such a 90-day
quarter.
(c) If at any time while the Property Trustee is
the holder of any Subordinated Debentures, the Trust or the Property Trustee is
required to pay any taxes, duties, assessments or governmental charges of
whatever nature (other than withholding taxes) imposed by the United States, or
any other taxing authority, then, in any case, the Company will pay as
additional interest ("Additional Interest") on the Subordinated Debentures held
by the Property Trustee, such additional amounts as shall be required so that
the net amounts received and retained by the Trust and the Property Trustee
after paying such taxes, duties, assessments or other governmental charges will
be equal to the amounts the Trust and the Property Trustee would have received
had no such taxes, duties, assessments or other government charges been imposed.
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ARTICLE III
REDEMPTION OF THE SUBORDINATED DEBENTURES
Section 3.1. Tax Event Redemption. If a Tax
Event has occurred and is continuing and the Company has received a Redemption
Tax Opinion, then, notwithstanding Section 3.2(a) but subject to Section 3.2(b),
the Company shall have the right upon not less than 30 days' nor more than 60
days' notice to the registered holders of the Subordinated Debentures to redeem
the Subordinated Debentures, in whole but not in part, for cash within 90 days
following the occurrence of such Tax Event (the "90 Day Period") at a redemption
price equal to 100% of the principal amount to be redeemed plus any accrued and
unpaid interest thereon to the date of such redemption (the "Redemption Price")
provided that, if at the time there is available to the Company the opportunity
to eliminate, within the 90 Day Period, the Tax Event by taking some ministerial
action ("Ministerial Action"), such as filing a form or making an election, or
pursuing some other similar reasonable measure that has no adverse effect on the
Company, the Trust or the Holders of the Trust Securities issued by the Trust,
the Company shall pursue such Ministerial Action in lieu of redemption; and
provided further, that the Company shall have no right to redeem the
Subordinated Debentures while the Trust is pursuing any Ministerial Action
pursuant to its obligations under the Declaration. The Redemption Price shall be
paid prior to 12:00 noon, New York time, on the date of such redemption or at
such earlier time as the Company determines and specifies in the notice of
redemption, provided the Company shall deposit with the Trustee an amount
sufficient to pay the Special Redemption Price by 11:00 a.m. on the date such
Redemption Price is to be paid.
Section 3.2. Optional Redemption by Company.
(a) Subject to the provisions of Article
III of the Indenture and to Section 3.2(b), the Company
shall have the right to redeem the Subordinated Debentures, in whole or in part,
from time to time, on or after March 31, 2003, at the Redemption Price. Any
redemption pursuant to this paragraph will be made upon not less than 30 days'
nor more than 60 days' notice to the registered holder of the Subordinated
Debentures, at the Redemption Price. If the Subordinated Debentures are only
partially redeemed pursuant to this Section 3.2, the Subordinated Debentures
will be redeemed pro rata or by lot or by any other method utilized by the
Trustee; provided, that if at the time of redemption, the Subordinated
Debentures are registered as a Global Security, the Depositary shall determine
by lot the principal amount of such Subordinated Debentures held by each holder
to be redeemed. The Redemption Price shall be paid prior to 12:00 noon, New York
time, on the date of such redemption or at such earlier time as the Company
determines and specifies in the notice of redemption, provided the Company shall
deposit with the Trustee an amount sufficient to pay the Redemption Price by
11:00 a.m. on the date such Redemption Price is to be paid.
(b) If a partial redemption of the Subordinated
Debentures would result in the delisting of the Preferred Securities issued by
the Trust from any national securities exchange or other organization on which
the Preferred Securities are then
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listed, the Company shall not be permitted to effect such partial redemption and
may only redeem the Subordinated Debentures in whole.
Section 3.3. No Sinking Fund. The
Subordinated Debentures are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
Section 4.1. Extension of Interest Payment
Period. The Company shall have the right, at any time and from time to time
during the term of the Subordinated Debentures, to extend the interest payment
period of such Subordinated Debentures for up to twenty (20) consecutive
quarters (the "Extended Interest Payment Period"); provided, that, during any
such Extended Interest Payment Period, (a) the Company may not declare or pay
any dividend on, make any distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its capital stock
(other than (i) purchases or acquisitions of shares of Company common stock in
connection with the satisfaction by the Company of its obligations under any
employee benefit plans or any other contractual obligation of the Company (other
than a contractual obligation ranking pari passu with or junior to the
Subordinated Debentures), (ii) as a result of a reclassification of Company
capital stock or the exchange or conversion of one class or series of Company
capital stock for another class or series of Company capital stock or (iii) the
purchase of fractional interests in shares of Company capital stock pursuant to
the conversion or exchange provisions of such Company capital stock or the
security being converted or exchanged), (b) the Company may not make any payment
of interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees) issued by the Company which rank pari
passu with or junior to the Subordinated Debentures and (c) the Company may not
make any guarantee payments with respect to the foregoing (other than pursuant
to the Preferred Securities Guarantee). To the extent permitted by applicable
law, interest, the payment of which has been deferred because of the extension
of the interest payment period pursuant to this Section 4.1, will bear interest
compounded quarterly at the Coupon Rate for each quarter of the Extended
Interest Payment Period ("Compounded Interest"). At the end of the Extended
Interest Payment Period, the Company shall pay all interest accrued and unpaid
on the Subordinated Debentures, including any Compounded Interest and Additional
Interest ("Deferred Interest") which shall be payable to the holders of the
Subordinated Debentures in whose names the Subordinated Debentures are
registered in the Security Register on the first record date after the end of
the Extended Interest Payment Period. Prior to the termination of any Extended
Interest Payment Period, the Company may further extend such period, provided
that such period together with all such further extensions thereof shall not
exceed twenty (20) consecutive quarters or extend beyond the maturity of the
Subordinated Debentures. Upon the termination of any Extended Interest Payment
Period and upon the payment of all Deferred Interest then due, the Company may
select a new Extended Interest Payment Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extended Interest
Payment Period, except at the end thereof.
Section 4.2. Notice of Extension.
(a) If the Property Trustee is the only registered
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holder of the Subordinated Debentures at the time the Company selects an
Extended Interest Payment Period, the Company shall give written notice to both
the Regular Trustees and the Property Trustee of its selection of such Extended
Interest Payment Period one Business Day before the earlier of (i) the next
succeeding date on which Distributions on the Trust Securities issued by the
Trust are payable, or (ii) the date the Trust is required to give notice of the
record or payment date for such Distributions to the New York Stock Exchange or
other applicable self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only holder
of the Subordinated Debentures at the time the Company selects an Extended
Interest Payment Period, the Company shall give the holders of the Subordinated
Debentures and the Trustee written notice of its selection of such Extended
Interest Payment Period ten (10) Business Days before the earlier of (i) the
next succeeding Interest Payment Date, or (ii) the date the Company is required
to give notice of the record or payment date of such interest payment to the New
York Stock Exchange or other applicable self-regulatory organization or to
holders of the Subordinated Debentures, but in any event at least two Business
Days before such record date.
(c) The quarter in which any notice is given
pursuant to paragraphs (a) or (b) of this Section 4.2 shall be counted as one of
the twenty quarters permitted in the maximum Extended Interest Payment Period
permitted under Section 4.1.
ARTICLE V
EXPENSES
Section 5.1. Payment of Expenses. In
connection with the offering, sale and issuance of the Subordinated Debentures
to the Property Trustee in connection with the sale of the Trust Securities by
the Trust, the Company shall:
(a) pay all costs and expenses relating to the
offering, sale and issuance of the Subordinated Debentures, including
commissions to the underwriters payable pursuant to the Underwriting
Agreement and compensation of the Trustee under the Indenture in
accordance with the provisions of Section 7.06 of the Indenture;
(b) pay all costs and expenses of the Trust
(including, but not limited to, costs and expenses relating to the
organization of the Trust, the offering, sale and issuance of the
Trust Securities (including commissions to the underwriters in connection
therewith), the fees and expenses of the Property Trustee and the
Delaware Trustee, the costs and expenses relating to the
operation of the Trust, including without limitation, costs and
expenses of accountants, attorneys, statistical or
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bookkeeping services, expenses for printing and engraving and computing
or accounting equipment, paying agent(s), registrar(s), transfer
agent(s), duplicating, travel and telephone and other telecommunications
expenses and costs and expenses incurred in connection with the
acquisition, financing, and disposition of Trust assets); and
(c) pay any and all taxes (other than United
States withholding taxes) and all liabilities, costs and expenses with
respect to such taxes of the Trust.
ARTICLE VI
SUBORDINATION
Section 6.1. Agreement to Subordinate. The
Company covenants and agrees, and each holder of Subordinated Debentures issued
hereunder by such holder's acceptance thereof likewise covenants and agrees,
that all Subordinated Debentures shall be issued subject to the provisions of
this Article VI; and each holder of a Subordinated Debenture, whether upon
original issue or upon transfer or assignment thereof, accepts and agrees to be
bound by such provisions.
The payment by the Company of the principal
of, premium, if any, and interest on all Subordinated Debentures issued
hereunder shall, to the extent and in the manner hereinafter set forth, be
subordinated and subject in right of payment to the prior payment in full of all
Senior Indebtedness of the Company, whether outstanding at the date of this
Second Supplemental Indenture or thereafter incurred.
No provision of this Article VI shall prevent the
occurrence of any default or Event of Default hereunder.
Section 6.2. Default on Senior Indebtedness.
In the event and during the continuation of any default by the
Company in the payment of principal, premium, interest or any other payment due
on any Senior Indebtedness of the Company, or in the event that the maturity of
any Senior Indebtedness of the Company has been accelerated because of a
default, then, in either case, no payment shall be made by the Company with
respect to the principal (including redemption payments) of, or premium, if any,
or interest on the Subordinated Debentures.
In the event that, notwithstanding the foregoing,
any payment shall be received by the Trustee or any holder of Subordinated
Debentures when such payment is prohibited by the preceding paragraph of this
Section 6.2, such payment shall be held in trust for the benefit of, and shall
be paid over or delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Indebtedness may have been issued, as their
respective interests may appear, but only to the extent that the holders of the
Senior Indebtedness (or their representative or representatives or a trustee)
notify the Trustee within 90
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days of such payment of the amounts then due and owing on the Senior
Indebtedness and only the amounts specified in such notice to the Trustee shall
be paid to the holders of Senior Indebtedness.
Section 6.3. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Senior Indebtedness
shall first be paid in full, or payment thereof provided for in money in
accordance with its terms, before any payment is made by the Company on account
of the principal (and premium, if any) or interest on the Subordinated
Debentures; and upon any such dissolution or winding-up or liquidation or
reorganization, any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the holders of the Subordinated Debentures or the Trustee would be
entitled to receive from the Company, except for the provisions of this Article
VI, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the holders of the Subordinated Debentures or by the Trustee under this
Indenture if received by them or it, directly to the holders of Senior
Indebtedness of the Company (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, as calculated by
the Company) or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing such
Senior Indebtedness may have been issued, as their respective interests may
appear, to the extent necessary to pay such Senior Indebtedness in full, in
money or money's worth, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness, before any
payment or distribution is made to the holders of Subordinated Debentures or to
the Trustee.
In the event that, notwithstanding the foregoing,
any payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, prohibited by the foregoing, shall be
received by the Trustee or the holders of the Subordinated Debentures before all
Senior Indebtedness of the Company is paid in full, or provision is made for
such payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered to
the holders of such Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness of the Company remaining
unpaid to the extent necessary to pay such Senior Indebtedness in full in money
in accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.
For purposes of this Article VI, the words "cash,
property or securities" shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this Article
VI with respect to the Subordinated Debentures to the payment of all Senior
Indebtedness of the Company that may at the time be outstanding, provided that
(i) such Senior Indebtedness is assumed by the new corporation, if any,
resulting from any such reorganization or readjustment, and (ii) the rights of
the holders of such Senior Indebtedness
-10-
are not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article X of the Indenture shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section 6.3 if such other corporation shall, as a part of such consolidation,
merger, conveyance or transfer, comply with the conditions stated in Article X
of the Indenture. Nothing in Section 6.2 or in this Section 6.3 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 7.06 of the
Indenture.
Section 6.4. Subrogation. Subject to the
payment in full of all Senior Indebtedness of the Company, the rights of the
holders of the Subordinated Debentures shall be subrogated to the rights of the
holders of such Senior Indebtedness to receive payments or distributions of
cash, property or securities of the Company applicable to such Senior
Indebtedness until the all amounts owing on the Subordinated Debentures shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of such Senior Indebtedness of any cash, property
or securities to which the holders of the Subordinated Debentures or the Trustee
would be entitled except for the provisions of this Article VI, and no payment
over pursuant to the provisions of this Article VI, to or for the benefit of the
holders of such Senior Indebtedness by holders of the Subordinated Debentures or
the Trustee, shall, as between the Company, its creditors other than holders of
Senior Indebtedness of the Company, and the holders of the Subordinated
Debentures be deemed to be a payment by the Company to or on account of such
Senior Indebtedness. It is understood that the provisions of this Article VI are
and are intended solely for the purposes of defining the relative rights of the
holders of the Subordinated Debentures, on the one hand, and the holders of such
Senior Indebtedness on the other hand.
Nothing contained in this Article VI or elsewhere
in this Indenture or in the Subordinated Debentures is intended to or shall
impair, as between the Company, its creditors other than the holders of Senior
Indebtedness of the Company, and the holders of the Subordinated Debentures, the
obligation of the Company which is absolute and unconditional, to pay to the
holders of the Subordinated Debentures the principal of (and premium, if any)
and interest on the Subordinated Debentures as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the holders of the Subordinated Debentures and
creditors of the Company, other than the holders of Senior Indebtedness of the
Company, nor shall anything herein or therein prevent the Trustee or the holder
of any Subordinated Debenture from exercising all remedies otherwise permitted
by applicable law upon default under the Indenture, subject to the rights, if
any, under this Article VI of the holders of such Senior Indebtedness in respect
of cash, property or securities of the Company, received upon the exercise of
any such remedy.
Upon any payment or distribution of assets of
the Company referred to in this Article VI, the Trustee, subject to the
provisions of Section 7.01 of the Indenture, and the holders of the Subordinated
Debentures, shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution, delivered to the Trustee or to the holders of the
Subordinated Debentures, for the purposes of ascertaining the Persons entitled
to participate in such distribution, the holders of
-11-
Senior Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article VI.
Section 6.5. Trustee to Effectuate Subordination.
Each holder of a Subordinated Debenture by such holder's acceptance
thereof authorizes and directs the Trustee on such holder's behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article VI and appoints the Trustee such holder's
attorney-in-fact for any and all such purposes.
Section 6.6. Notice by the Company. The Company
shall give prompt written notice to a Responsible Officer of the Trustee
of any fact known to the Company that would prohibit the making of any payment
of monies to or by the Trustee in respect of the Subordinated Debentures
pursuant to the provisions of this Article VI. Notwithstanding the provisions of
this Article VI or any other provision of the Indenture and this Second
Supplemental Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment of monies
to or by the Trustee in respect of the Subordinated Debentures pursuant to the
provisions of this Article VI unless and until a Responsible Officer of the
Trustee shall have received written notice thereof at the Principal Office of
the Trustee from the Company or a holder or holders of Senior Indebtedness or
from any trustee therefor; and before the receipt of any such written notice,
the Trustee, subject to the provisions of Section 7.01 of the Indenture, shall
be entitled in all respects to assume that no such facts exist; provided,
however, that if the Trustee shall not have received the notice provided for in
this Section 6.6 at least two Business Days prior to the date upon which by the
terms hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of (or premium, if any) or interest on
any Subordinated Debenture), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
money and to apply the same to the purposes for which they were received, and
shall not be affected by any notice to the contrary that may be received by it
within two Business Days prior to such date.
The Trustee, subject to the provisions of
Section 7.01 of the Indenture, shall be entitled to rely on the delivery to it
of a written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Company (or a trustee on behalf of such holder) to establish
that such notice has been given by a holder of such Senior indebtedness or a
trustee on behalf of any such holder or holders. In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any Person as a holder of such Senior Indebtedness to participate in
any payment or distribution pursuant to this Article VI, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of such Senior Indebtedness held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such Person under this Article VI,
and if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment.
Section 6.7. Rights of the Trustee; Holders
of Senior Indebtedness. The Trustee in its individual capacity shall be entitled
to all the rights set forth in this Article VI in respect of any Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
-12-
With respect to the holders of Senior Indebtedness
of the Company, the Trustee undertakes to perform or to observe only such
of its covenants and obligations as are specifically set forth in this Article
VI, and no implied covenants or obligations with respect to the holders of such
Senior Indebtedness shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of such
Senior Indebtedness and, subject to the provisions of Section 7.01 of the
Indenture, the Trustee shall not be liable to any holder of such Senior
Indebtedness if it shall pay over or deliver to holders of Subordinated
Debentures, the Company or any other Person money or assets to which any holder
of such Senior Indebtedness shall be entitled by virtue of this Article VI or
otherwise.
Section 6.8. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness of
the Company to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company with the terms, provisions and covenants of
the Indenture, regardless of any knowledge thereof that any such holder may have
or otherwise be charged with.
Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness of the Company may, at
any time and from time to time, without the consent of or notice to the Trustee
or the holders of the Subordinated Debentures, without incurring responsibility
to the holders of the Subordinated Debentures and without impairing or releasing
the subordination provided in this Article VI or the obligations hereunder of
the holders of the Subordinated Debentures to the holders of such Senior
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, such
Senior Indebtedness, or otherwise amend or supplement in any manner such Senior
Indebtedness or any instrument evidencing the same or any agreement under which
such Senior Indebtedness is outstanding; (ii) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing such
Senior Indebtedness; (iii) release any Person liable in any manner for the
collection of such Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
Section 7.1. Listing on Exchange. If the
Subordinated Debentures are to be issued as a Global Security in connection with
the distribution of the Subordinated Debentures to the holders of the Preferred
Securities issued by the Trust upon the dissolution of the Trust, the Company
will use its best efforts to list such Subordinated Debentures on the American
Stock Exchange or on such other exchange as the Preferred Securities are then
listed.
-13-
ARTICLE VIII
FORM OF SUBORDINATED DEBENTURE
Section 8.1. Form of Subordinated Debenture.
The Subordinated Debentures and the Trustee's Certificate of
Authentication to be endorsed thereon are to be substantially in the following
forms:
(FORM OF FACE OF SUBORDINATED DEBENTURE)
[IF THE SUBORDINATED DEBENTURE IS TO BE A GLOBAL
SECURITY, INSERT: This Subordinated Debenture 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 Depositary. This Subordinated
Debenture is exchangeable for Subordinated Debentures registered in the name of
a person other than the Depositary or its nominee only in the limited
circumstances described in the Indenture, and no transfer of this Subordinated
Debenture (other than a transfer of this Subordinated Debenture as a whole by
the Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary) may be registered except
in limited circumstances.
Unless this Subordinated Debenture is
presented by an authorized representative of The Depository Trust Company (55
βββββ ββββββ, βββ ββββ, βββ ββββ) to the issuer or its agent for registration of
transfer, exchange or payment, and any Subordinated Debenture issued is
registered in the name of Cede & Co. or such other name as requested by an
authorized representative of The Depository Trust Company and any payment hereon
is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY A PERSON IS WRONGFUL since the registered owner hereof, Cede & Co.,
has an interest herein.]
-14-
No. $
CUSIP No.
TELEPHONE AND DATA SYSTEMS, INC.
8.04% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
DUE MARCH 31, 2038
TELEPHONE AND DATA SYSTEMS, INC., an
Iowa corporation (the "Company", which term includes any successor corporation
under the Indenture hereinafter referred to), for value received, hereby
promises to pay to _______ or registered assigns, the principal sum of
____________ Dollars on March 31, 2038, or such later date extended by the
Company not later than March 31, 2047, and to pay interest on said principal sum
from February 10, 1998 or from the most recent interest payment date (each such
date, an "Interest Payment Date") to which interest has been paid or duly
provided for, quarterly (subject to deferral as set forth herein) in arrears on
March 31, June 30, September 30 and December 31 of each year commencing, March
31, 1998, at the rate of 8.04% per annum until the principal hereof shall have
become due and payable, and on any overdue principal and premium, if any, and
(without duplication and to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest
compounded quarterly at the same rate per annum. The amount of interest payable
on any Interest Payment Date shall be computed on the basis of a 360-day year of
twelve 30-day months. In the event that any date on which interest is payable on
this Subordinated Debenture is not a Business Day, then payment of interest
payable on such date will be made on the next succeeding day which is a Business
Day (and without any interest or other payment in respect of any such delay),
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date. The interest installment
so payable, and punctually paid or duly provided for, on any Interest Payment
Date will, as provided in the Indenture, be paid to the Person in whose name
this Subordinated Debenture (or one or more Predecessor Securities, as defined
in said Indenture) is registered at the close of business on the regular record
date for such interest installment [which shall be the close of business on the
Business Day next preceding such Interest Payment Date.] [IF PURSUANT TO THE
PROVISIONS OF Section 2.11(C) OF THE INDENTURE THE SUBORDINATED DEBENTURES ARE
NO LONGER REPRESENTED BY A GLOBAL SECURITY -- which shall be the close of
business on the ________ day preceding such Interest Payment Date.] Any such
interest installment not punctually paid or duly provided for shall forthwith
cease to be payable to the registered holders on such regular record date, and
may be paid to the Person in whose name this Subordinated Debenture (or one or
more Predecessor Securities) is registered at the close of business on a special
record date to be fixed by the Trustee for the payment of such defaulted
interest, notice whereof shall be given to the registered holders of this series
of Subordinated Debentures not less than ten (10) days prior to such special
record date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Subordinated Debentures may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture. The principal of
(and premium, if any) and the interest on this Subordinated Debenture shall be
payable at the office or agency of the Trustee maintained for that purpose in
Chicago, Illinois, in any coin or currency of the ββββββ
-ββ-
ββββββ ββ βββββββ which at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of interest may be
made at the option of the Company by check mailed to the registered holder at
such address as shall appear in the Security Register. Notwithstanding the
foregoing, so long as the holder of this Subordinated Debenture is the Property
Trustee, the payment of the principal of (and premium, if any) and interest on
this Subordinated Debenture will be made at such place and to such account as
may be designated by the Property Trustee.
The indebtedness evidenced by this Subordinated
Debenture is, to the extent provided in the Indenture, subordinate
and junior in right of payment to the prior payment in full of all Senior
Indebtedness, and this Subordinated Debenture is issued subject to the
provisions of the Indenture with respect thereto. Each holder of this
Subordinated Debenture, by accepting the same, (a) agrees to and shall be bound
by such provisions, (b) authorizes and directs the Trustee on behalf of such
holder to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided, (c) appoints the Trustee the
attorney-in-fact of such holder for any and all such purposes and (d) agrees to
treat this Subordinated Debenture as indebtedness and not as equity for federal
income tax purposes. Each holder hereof, by acceptance hereof, hereby waives all
notice of the acceptance of the subordination provisions contained herein and in
the Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
This Subordinated Debenture shall not be
entitled to any benefit under the Indenture hereinafter referred to, be valid or
become obligatory for any purpose until the Certificate of Authentication hereon
shall have been signed by or on behalf of the Trustee.
Unless the Certificate of Authentication hereon
has been executed by the Trustee referred to on the reverse side hereof, this
Subordinated Debenture shall not be entitled to any benefit under the Indenture
or be valid or obligatory for any purpose.
The provisions of this Subordinated Debenture
are continued on the reverse side hereof and such continued provisions shall for
all purposes have the same effect as though fully set forth at this place.
-16-
IN WITNESS WHEREOF, the Company has
caused this instrument to be executed.
Dated: ___________
TELEPHONE AND DATA SYSTEMS, INC.
By
[Title]
Attest:
By
Secretary
-17-
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Subordinated Debentures of the
series of Subordinated Debentures described in the within-mentioned Indenture.
THE FIRST NATIONAL BANK _______________________
OF CHICAGO, as Authentication Agent
Not in Its Individual
Capacity But Solely
as Trustee
By By
Authorized Signatory Authorized Signatory
(FORM OF REVERSE OF SUBORDINATED DEBENTURE)
This Subordinated Debenture is one of a duly
authorized series of Subordinated Debentures of the Company (herein sometimes
referred to as the "Subordinated Debentures"), specified in the Indenture, all
issued or to be issued in one or more series under and pursuant to an Indenture
dated as of _______, 1998, duly executed and delivered between the Company and
The First National Bank of Chicago, not in its individual capacity but solely as
trustee (the "Trustee"), as supplemented by the Second Supplemental Indenture
dated as of _______, 1998 between the Company and the Trustee (the Indenture as
so supplemented, the "Indenture"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Subordinated Debentures. By the
terms of the Indenture, the Subordinated Debentures are issuable in series which
may vary as to amount, date of maturity, rate of interest and in other respects
as in the Indenture provided. This series of Subordinated Debentures is limited
in aggregate principal amount as specified in said Second Supplemental
Indenture.
Upon the occurrence and continuation of a Tax
Event, in certain circumstances this Subordinated Debenture will become due and
payable at the principal amount together with any interest accrued thereon (the
"Redemption Price"). The Redemption Price shall be paid prior to 12:00 noon, New
York time, on the date of such redemption or at such earlier time as the Company
determines. The Company shall have the
-18-
right to redeem this Subordinated Debenture at the option of the Company,
without premium or penalty, in whole or in part at any time on or after March
31, 2003 (an "Optional Redemption"), at the Redemption Price. Any Optional
Redemption pursuant to this paragraph will be made upon not less than 30 days'
nor more than 60 days' notice, at the Redemption Price. If the Subordinated
Debentures are only partially redeemed by the Company pursuant to an Optional
Redemption, the Subordinated Debentures will be redeemed pro rata or by lot or
by any other method utilized by the Trustee; provided that if at the time of
redemption, the Subordinated Debentures are registered as a Global Security, the
Depositary shall determine by lot the principal amount of such Subordinated
Debentures held by each holder to be redeemed.
In the event of redemption of this Subordinated
Debenture in part only, a new Subordinated Debenture or Subordinated Debentures
of this series for the unredeemed portion hereof will be issued in the name of
the holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the
Indenture, shall have occurred and be continuing, the principal of all of the
Subordinated Debentures may be declared, and upon such declaration shall become,
due and payable, in the manner, with the effect and subject to the conditions
provided in the Indenture.
The Indenture contains provisions permitting
the Company and the Trustee, with the consent of the holders of not less than a
majority in aggregate principal amount of the Subordinated Debentures of each
series affected at the time Outstanding, as defined in the Indenture, to execute
supplemental indentures for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of the Indenture or of any
supplemental indenture or of modifying in any manner the rights of the holders
of the Subordinated Debentures; provided, however, that no such supplemental
indenture shall (i) extend the fixed maturity of any Subordinated Debentures of
any series, or reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon, or reduce any premium payable upon the
redemption thereof, without the consent of the holder of each Subordinated
Debenture so affected or (ii) reduce the aforesaid percentage of Subordinated
Debentures, the holders of which are required to consent to any such
supplemental indenture, without the consent of the holders of each Subordinated
Debenture then outstanding and affected thereby. The Indenture also contains
provisions permitting the holders of a majority in aggregate principal amount of
the Subordinated Debentures of any series at the time outstanding affected
thereby, on behalf of all of the holders of the Subordinated Debentures of such
series, to waive any past default in the performance of any of the covenants
contained in the Indenture, or established pursuant to the Indenture with
respect to such series, and its consequences, except a default in the payment of
the principal of or premium, if any, or interest on any of the Subordinated
Debentures of such series. Any such consent or waiver by the registered holder
of this Subordinated Debenture (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such holder and upon all future holders and
owners of this Subordinated Debenture and of any Subordinated Debenture issued
in exchange herefor or in place hereof (whether by registration of transfer or
otherwise), irrespective of whether or not any notation of such consent or
waiver is made upon this Subordinated Debenture.
No reference herein to the Indenture and no
provision of this Subordinated Debenture or of the Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and premium, if
-19-
any, and interest on this Subordinated Debenture at the time and place and at
the rate and in the money herein prescribed.
The Company shall have the right at any time
during the term of the Subordinated Debentures, from time to time to extend the
interest payment period of such Subordinated Debentures for up to twenty (20)
consecutive quarters (an "Extended Interest Payment Period"), at the end of
which period the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Subordinated
Debentures to the extent that payment of such interest is enforceable under
applicable law). Before the termination of any such Extended Interest Payment
Period, the Company may further extend such Extended Interest Payment Period,
provided that such Extended Interest Payment Period together with all such
further extensions thereof shall not exceed twenty (20) consecutive quarters or
extend beyond the maturity of the Subordinated Debentures. At the termination of
any such Extended Interest Payment Period and upon the payment of all accrued
and unpaid interest then due, the Company may select a new Extended Interest
Payment Period.
As provided in the Indenture and subject to
certain limitations therein set forth, this Subordinated Debenture is
transferable by the registered holder hereof on the Security Register of the
Company, upon surrender of this Subordinated Debenture for registration of
transfer at the office or agency of the Trustee in Chicago, Illinois,
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company or the Trustee duly executed by the registered
holder hereof or the attorney of such holder duly authorized in writing, and
thereupon one or more new Subordinated Debentures of authorized denominations
and for the same aggregate principal amount and series will be issued to the
designated transferee or transferees. No service charge will be made for any
such transfer, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in relation thereto.
Prior to due presentment for registration of
transfer of this Subordinated Debenture, the Company, the Trustee, any paying
agent and any Security Registrar may deem and treat the registered holder hereof
as the absolute owner hereof (whether or not this Subordinated Debenture shall
be overdue and notwithstanding any notice of ownership or writing hereon made by
anyone other than the Security Registrar) for the purpose of receiving payment
of or on account of the principal hereof and premium, if any, and interest due
hereon and for all other purposes, and neither the Company nor the Trustee nor
any paying agent nor any Security Registrar shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the
principal of or the interest on this Subordinated Debenture, or for any claim
based hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or director, past,
present or future, as such, of the Company or of any predecessor or successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.
[The Subordinated Debentures of this series
are issuable only in registered form without coupons in denominations of $25 and
any integral multiple thereof.] [This Global Security is exchangeable for
Subordinated Debentures in
-20-
definitive form only under certain limited circumstances set forth in the
Indenture. Subordinated Debentures of this series so issued are issuable only in
registered form without coupons in denominations of $25 and any integral
multiple thereof.] As provided in the Indenture and subject to certain
limitations [herein and] therein set forth, Subordinated Debentures of this
series [so issued] are exchangeable for a like aggregate principal amount of
Subordinated Debentures of this series of a different authorized denomination,
as requested by the holder surrendering the same.
All terms used in this Subordinated Debenture
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.
ARTICLE IX
ORIGINAL ISSUE OF SUBORDINATED DEBENTURES
Section 9.1. Original Issue of Subordinated
Debentures. Subordinated Debentures in the aggregate principal amount of
$154,640,000 may, upon execution of this Second Supplemental Indenture, be
executed by the Company and delivered to the Trustee for authentication, and the
Trustee shall thereupon authenticate and deliver said Subordinated Debentures to
or upon the written order of the Company, signed by its Chairman, its President,
or any Vice President and its Treasurer or an Assistant Treasurer, without any
further action by the Company.
ARTICLE X
MISCELLANEOUS
Section 10.1. Ratification of Indenture. The
Indenture, as supplemented by this Second Supplemental Indenture, is in all
respects ratified and confirmed, and this Second Supplemental Indenture shall be
deemed part of the Indenture in the manner and to the extent herein and therein
provided.
Section 10.2. Trustee Not Responsible for
Recitals. The recitals herein contained are made by the Company and not by the
Trustee, and the Trustee assumes no responsibility for the correctness thereof.
The Trustee makes no representation as to the validity or sufficiency of this
Second Supplemental Indenture.
Section 10.3. Governing Law. This Second
Supplemental Indenture and each Subordinated Debenture shall be deemed to be a
contract made under the internal laws of the State of New York, and for all
purposes shall be construed in accordance with the laws of said State.
Section 10.4. Separability. In case any one
or more of the provisions contained in this Second Supplemental Indenture or in
the Subordinated Debentures shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Second Supplemental Indenture or
of the Subordinated Debentures, but this Second Supplemental Indenture and the
Subordinated Debentures shall be construed as if such invalid
-21-
or illegal or unenforceable provision had never been contained herein or
therein.
Section 10.5. Counterparts. This Second
Supplemental Indenture may be executed in any number of counterparts each of
which shall be an original; but such counterparts shall together constitute but
one and the same instrument.
-22-
IN WITNESS WHEREOF, the parties hereto have
caused this Second Supplemental Indenture to be duly executed, and their
respective corporate seals to be hereunto affixed and attested, on the date or
dates indicated in the acknowledgments and as of the day and year first above
written.
TELEPHONE AND DATA SYSTEMS, INC.
By:_______________________________
Title:
[Corporate Seal]
Attest:
Secretary
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity
but solely as Trustee
By:_______________________________
Title:
[Corporate Seal]
Attest:
Title:
STATE OF ILLINOIS )
COUNTY OF ββββ ) ss:
On the day of _____, 1998, before me personally came ________________,
to me known, who, being by me duly sworn, did depose and say that he is a
______________ of TELEPHONE AND DATA SYSTEMS, INC., one of the corporations
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the said instrument
is such corporate seal; that it was so affixed by authority of the Board of
Directors of said corporation, and that he signed his name thereto by like
authority.
NOTARY PUBLIC
[seal] Commission expires
STATE OF ILLINOIS )
COUNTY OF ββββ ):
On the day of___________, 1998, before me personally
came ____________, to me known, who, being by me duly sworn, did depose and say
that he is the ____________________ of THE FIRST NATIONAL BANK OF CHICAGO, one
of the corporations described in and which executed the above instrument; that
he knows the corporate seal of said corporation; that the seal affixed to the
said instrument is such corporate seal; that it was so affixed by authority of
the Board of Directors of said corporation, and that he signed his name thereto
by like authority.
NOTARY PUBLIC
[seal] Commission expires