Modification and Waiver
There are three types of changes we can make to the indenture and the debt securities.
Changes Requiring Your Approval. First, there are changes that cannot be made to your debt securities without your specific approval. (Section 902). Following is a list of those types of changes:
|
·
|
change the stated maturity of the principal, or any installment of principal or interest on a debt security;
|
|
·
|
reduce any principal amounts or the rate of interest on a debt security or any premium due on a debt security;
|
|
·
|
change any of our or Statoil Petroleum's obligations to pay additional amounts described later under "—Payment of Additional Amounts";
|
|
·
|
reduce the amount of principal payable upon acceleration of the maturity of an original issue discount security or any other debt security following a default;
|
|
·
|
change the place or currency of payment on a debt security;
|
|
·
|
impair your right to sue for payment;
|
|
·
|
reduce the percentage of holders of debt securities whose consent is needed to modify or amend the indenture;
|
|
·
|
reduce the percentage of holders of debt securities whose consent is needed to waive compliance with various provisions of the indenture or to waive various defaults;
|
|
·
|
modify any other aspect of the provisions dealing with modification and waiver of the indenture, unless to provide that additional provisions of the indenture cannot be modified or waived without your consent; and
|
|
·
|
modify or affect in any manner adverse to you the obligations of Statoil Petroleum that relate to the payment of principal, premium and interest and sinking fund payments.
|
Changes Requiring a Majority Vote. The second type of change to the indenture and the debt securities is the kind that requires a vote in favor by holders of debt securities owning not less than a majority of the principal amount of the outstanding securities of the particular series affected. Most changes fall into this category, except for clarifying changes and other changes that would not adversely affect holders of the debt securities in any material respect. The same vote would be required for us to obtain a waiver of a past default. However, we cannot obtain a waiver of a payment default or any other aspect of the indenture or the debt securities listed in the first category described previously under "Changes Requiring Your Approval" unless we obtain your individual consent to the waiver. (Section 513).
Changes Not Requiring Approval. The third type of change does not require any vote by holders of debt securities. This type is limited to clarifications and other changes that would not adversely affect holders of the debt securities in any material respect. (Section 901).
Further Details Concerning Voting. When taking a vote, we will use the following rules to decide how much principal amount to attribute to a security:
|
·
|
For original issue discount securities, we will use the principal amount that would be due and payable on the voting date if the maturity of the debt securities were accelerated to that date because of a default.
|
|
·
|
For debt securities whose principal amount is not known (for example, because it is based on an index), we will use a special rule for that security described in the prospectus supplement.
|
|
·
|
For debt securities denominated in one or more foreign currencies or currency units, we will use the U.S. dollar equivalent.
|
|
·
|
Debt securities will not be considered outstanding, and therefore not eligible to vote, if we have deposited or set aside in trust for you money for their payment or redemption. Debt securities will also not be eligible to vote if they have been fully defeased as described later under "—Defeasance and Discharge". (Section 101).
|
|
·
|
We will generally be entitled to set any day as a record date for the purpose of determining the holders of outstanding debt securities that are entitled to vote or take other action under the indenture. In limited circumstances, the trustee will be entitled to set a record date for action by holders. If we or the trustee set a record date for a vote or other action to be taken by holders of a particular series, that vote or action may be taken only by persons who are holders of outstanding debt securities of that series on the record date and must be taken within 180 days following the record date or another period that we may specify (or as the trustee may specify, if it set the record date). We may shorten or lengthen (but not beyond 180 days) this period from time to time. (Section 104).
|
Street name and other indirect holders should consult their banks or brokers for information on how approval may be granted or denied if we seek to change the indenture or the debt securities or request a waiver.
|
Optional Tax Redemption
We and Statoil Petroleum may have the option to redeem the debt securities in the two situations described below. The redemption price for the debt securities, other than original issue discount debt securities, will be equal to the principal amount of the debt securities being redeemed plus accrued interest and any additional amounts due on the date fixed for redemption. The redemption price for outstanding original issue discount debt securities will be specified in the prospectus supplement for such securities. Furthermore, we must give you between 30 and 60 days' notice before redeeming the debt securities.
The first situation is where, as a result of changes in or amendment to, or changes in the official application or interpretation of, any laws or regulations or rulings, or changes in the official application or interpretation of, or any execution of or amendment to, any treaties, we or Statoil Petroleum would be required to pay additional amounts as described later under "—Payment of Additional Amounts".
This applies only in the case of changes, executions or amendments that become effective on or after the date specified in the prospectus supplement for the applicable series of debt securities and in the jurisdiction where we are incorporated. If we or Statoil Petroleum are succeeded by another entity, the applicable jurisdiction will be the jurisdiction in which such successor entity is organized or incorporated, and the applicable date will be the date the entity became a successor.
We or Statoil Petroleum would not have the option to redeem in this case if we could have avoided the payment of additional amounts or the deduction or withholding by using reasonable measures available to us.
The second situation is where, following a merger, consolidation, sale or lease of our assets to a person that assumes our obligations on the debt securities, that person is required to pay additional amounts as described later under "—Payment of Additional Amounts". We, or the other person, would have the option to redeem the debt securities in this situation even if the additional amounts became payable immediately upon completion of the merger or sale transaction, including in connection with an internal corporate reorganization. Neither we nor that person have any obligation under the indenture to seek to avoid the obligation to pay additional amounts in this situation.
We, or that other person, as applicable, shall deliver to the trustee an officer's certificate to the effect that the circumstances required for redemption exist. (Section 1108).
Payment of Additional Amounts
The government or any political subdivision or taxing authority of such government of any jurisdiction where we or Statoil Petroleum are incorporated may require us or Statoil Petroleum to withhold amounts from payments on the principal or interest on a debt security or payment under the guarantees for taxes, assessments or any other governmental charges. If any such jurisdiction requires a withholding of this type, we or Statoil Petroleum may be required to pay you additional amounts so that the net amount you receive will be the amount specified in the debt security to which you are entitled. However, in order for you to be entitled to receive the additional amount, you must not be resident in the jurisdiction that requires the withholding. We and Statoil Petroleum will not have to pay additional amounts under any or any combination of the following circumstances:
|
·
|
The U.S. government or any political subdivision or taxing authority of such government is the entity that is imposing the tax, assessment or governmental charge.
|
|
·
|
The tax, assessment or governmental charge is imposed only because the holder, or a fiduciary, settlor, beneficiary or member or shareholder of, or possessor of a power over, the holder, if the holder is an estate, trust, partnership or corporation, was or is connected to the taxing jurisdiction, other than by merely holding the debt security or receiving principal or interest in respect thereof. These connections include where the holder or related party:
|
|
·
|
is or has been a citizen or resident of the jurisdiction;
|
|
·
|
is or has been present or engaged in trade or business in the jurisdiction; or
|
|
·
|
has or had a permanent establishment in the jurisdiction.
|
|
·
|
The tax, assessment or governmental charge is imposed due to the presentation of a debt security, if presentation is required, for payment on a date more than 30 days after the security became due or after the payment was provided for, whichever occurs later, except to the extent that the holder would have been entitled to such additional amounts if it had presented the security for payment on any day within such 30 day period.
|
|
·
|
The tax, assessment or governmental charge is on account of an estate, inheritance, gift, sale, transfer, personal property or similar tax, assessment or other governmental charge.
|
|
·
|
The tax, assessment or governmental charge is for a tax or governmental charge that is payable in a manner that does not involve withholding.
|
|
·
|
The tax, assessment or governmental charge is imposed or withheld because the holder or beneficial owner failed to comply with any of our following requests:
|
|
·
|
to provide information about the nationality, residence or identity or connection with the Kingdom of Norway or any political subdivision thereof of the holder or beneficial owner, or
|
|
·
|
to make a declaration or other similar claim or satisfy any information or reporting requirements that the statutes, treaties, regulations or administrative practices of the taxing jurisdiction require as a precondition to exemption from all or part of such tax, assessment or governmental charge.
|
|
·
|
The tax, assessment or governmental charge is imposed pursuant to European Union Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of November 26 and 27, 2000 on the taxation of savings or any law or agreement implementing or complying with, or introduced to conform to, such directive.
|
|
·
|
The tax, assessment or governmental charge is imposed on a holder or beneficial owner who could have avoided such withholding or deduction by presenting its debt securities, if presentation is required, to another paying agent.
|
|
·
|
The holder is a fiduciary, partnership or other entity that is not the sole beneficial owner of the payment of the principal of, or any interest on, any debt security, and the laws of the jurisdiction (or any political subdivision or taxing authority thereof or therein) require the payment to be included in the income of a beneficiary or settlor for tax purposes with respect to such fiduciary, a member of such partnership or a beneficial owner who would not have been entitled to such additional amounts had such beneficiary, settlor, member or beneficial owner been the holder of such security.
|
These provisions will also apply to any present or future taxes, assessments or governmental charges imposed by any jurisdiction in which our successor or Statoil Petroleum's successor is organized or incorporated. The prospectus supplement relating to the debt securities may describe additional circumstances in which we would not be required to pay additional amounts. (Section 1009).
Covenants
The indenture does not contain any covenants restricting our or Statoil Petroleum's ability to make payments, dispose of assets, issue and sell capital stock, enter into transactions with affiliates, create or incur liens on our property or engage in business other than our present business, except as described under "—Special Situations—Mergers and Similar Events" above, and except as described in "—Negative Pledge" and "—Limitation on Sale and Leaseback Transactions" below. A particular series of debt securities, however, may contain restrictive covenants of this type, which we will describe in the applicable prospectus supplement.
Negative Pledge
For so long as any debt securities remain outstanding, neither we nor Statoil Petroleum will create, incur, guarantee or assume after the date of the indenture any notes, bonds, debentures or other similar evidences of indebtedness for money borrowed ("Debt") secured by a mortgage, pledge, security interest, lien or other similar encumbrance (a "mortgage" or "mortgages") on any "Principal Property" (defined below) or on any shares of stock or indebtedness of any "Restricted Subsidiary" (defined below), without effectively providing concurrently with the creation, incurrence, guarantee or assumption of such Debt that the debt securities (together with any other Debt of Statoil or Statoil Petroleum then existing or thereafter created ranking equally with the debt securities) will be secured equally and ratably with (or prior to) the Debt, so long as the Debt will be so secured.
This restriction is subject to certain exceptions to which it does not apply, including but not limited to the following: (i) mortgages on property, shares of stock or indebtedness of any corporation existing at the time it becomes a subsidiary of Statoil or Statoil Petroleum provided that any such mortgage was not created in contemplation of becoming a subsidiary; (ii) mortgages on property or shares of stock existing at the time of acquisition thereof or to secure the payment of all or any part of the purchase price thereof or all or part of the cost of the improvement, construction, alteration or repair of any building, equipment or facilities or of any other improvements on, all or any part of the property or to secure any Debt incurred prior to, at the time of, or within 12 months after, in the case of shares of stock, the acquisition of such shares and, in the case of property, the later of the acquisition, the completion of construction (including any improvements, alterations or repairs on an existing property) or the commencement of commercial operation of such property, which Debt is incurred for the purpose of financing all or any part of the purchase price thereof or all or part of the cost of improvement, construction, alteration or repair thereon; (iii) mortgages on any Principal Property or on shares of stock or indebtedness of any subsidiary of Statoil or Statoil Petroleum, to secure all or any part of the cost of exploration, drilling, development, improvement, construction, alteration or repair of any part of the Principal Property or to secure any Debt incurred to finance or refinance all or any part of such cost; (iv) mortgages existing at the date of the indenture; (v) mortgages on property owned or held by any corporation or on shares of stock or indebtedness of any corporation, in either case existing at the time such corporation is merged into or consolidated or amalgamated with either Statoil, Statoil Petroleum or a subsidiary, or at the time of a sale, lease or other disposition of the properties of a corporation as an entirety or substantially as an entirety to Statoil, Statoil Petroleum or a subsidiary; (vi) mortgages arising by operation of law (other than by reason of default); (vii) mortgages to secure Debt incurred in the ordinary course of business and maturing not more than 12 months from the date incurred; (viii) mortgages arising pursuant to the specific terms of any license, joint operating agreement, unitization agreement or other similar document evidencing the interest of Statoil, Statoil Petroleum or a subsidiary in any oil or gas field and/or facilities (including pipelines), provided that any such mortgage is limited to such interest; (ix) mortgages to secure indebtedness for borrowed money incurred in connection with a specifically identifiable project where the mortgage relates to a Principal Property to which such project has been undertaken and the recourse of the creditors in respect of such mortgage is substantially limited to such project and Principal Property; (x) mortgages created in accordance with normal practice to secure Debt of Statoil or Statoil Petroleum whose main purpose is the raising of finances under any options, futures, swaps, short sale contracts or similar or related instruments which relate to the purchase or sale of securities, commodities or currencies; and (xi) any extension, renewal or replacement (or successive extensions, renewals or replacements), as a whole or in part, of any mortgages referred to in (i) through (x) of this paragraph, or of any Debt secured thereby; provided that the principal amount of Debt secured thereby shall not exceed the principal amount of Debt so secured at the time of such extension, renewal or replacement, and that such extension, renewal or replacement mortgage shall be limited to all or any part of the same property or shares of stock that secured the mortgage extended, renewed or replaced (plus improvements on such property), or property received or shares of stock issued in substitution or exchange therefor.
Notwithstanding the foregoing, Statoil and Statoil Petroleum may each create, incur, guarantee or assume Debt secured by a mortgage or mortgages which would otherwise be subject to the foregoing restrictions in an aggregate amount which, together with all other such Debt of Statoil or Statoil Petroleum in respect of Sale and Leaseback Transactions (as defined under "—Limitation on Sale and Leaseback Transactions" below) (other than Attributable Debt in respect of Sale and Leaseback Transactions permitted because Statoil or Statoil Petroleum would be entitled to create, incur, guarantee or assume such Debt secured by a mortgage on the property to be leased without equally and ratably securing any debt securities pursuant to the next preceding paragraph and other than Sale and Leaseback Transactions the proceeds of which have been applied as provided in clause (iii) under "—Limitation on Sale and Leaseback Transactions" below), does not at the time exceed 10% of Consolidated Net Tangible Assets (as defined under "—Limitation on Sale and Leaseback Transactions" below).
The following types of transactions, among others, shall not be deemed to create Debt secured by a mortgage:
|
(i)
|
the sale or other transfer, by way of security or otherwise, of (a) oil, gas or other minerals in place or at the wellhead or a right or license granted by any governmental authority to explore for, drill, mine, develop, recover or get such oil, gas or other minerals (whether such license or right is held with others or not) for a period of time until, or in an amount such that, the purchaser will realize therefrom a specified amount of money (however determined) or a specified amount of such oil, gas or other minerals, or (b) any other interest in property of the character commonly referred to as "production payment"; and
|
|
(ii)
|
mortgages on property in favor of the United States or any state thereof, or the Kingdom of Norway, or any other country, or any political subdivision of any of the foregoing, or any department, agency or instrumentality of the foregoing, to secure partial progress, advance or other payments pursuant to the provisions of any contract or statute including, without limitation, mortgages to secure indebtedness of the pollution control or industrial revenue bond type, or to secure any indebtedness incurred for the purpose of financing all or any part of the purchase price or cost of construction of the property subject to such mortgages; provided that any such mortgage in favor of any country (other than the United States or the Kingdom of Norway), or any political subdivision thereof, or any department, agency or instrumentality of any of the foregoing, shall be restricted to the property located in such country.
|
For purposes of this covenant and "—Limitation on Sale and Leaseback Transactions" below, "Principal Property" means an interest in (i) any oil or gas producing property (including leases, rights or other authorizations to conduct operations over any producing property), (ii) any refining or manufacturing plant and (iii) any pipeline for the transportation of oil or gas, which in each case under (i), (ii) and (iii) above, is of material importance to the total business conducted by Statoil and its subsidiaries as a whole. "Restricted Subsidiary" means any subsidiary of Statoil or Statoil Petroleum which owns a Principal Property. (Section 1010).
Limitation on Sale and Leaseback Transactions
For so long as any debt securities remain outstanding, neither we nor Statoil Petroleum will enter into any arrangement with any person (not including any subsidiary) providing for the leasing by Statoil or Statoil Petroleum for a period, including renewals, in excess of three years, of any Principal Property which has been owned by Statoil or Statoil Petroleum for more than six months and which has been or is to be sold or transferred by Statoil or Statoil Petroleum to such person (a "Sale and Leaseback Transaction") unless, after giving effect thereto, the aggregate amount of all "Attributable Debt" (defined below) with respect to all such Sale and Leaseback Transactions plus all Debt (as defined under "—Negative Pledge" above) of Statoil or Statoil Petroleum incurred, issued, assumed or guaranteed and secured by a mortgage or mortgages (with the exception of Debt secured by a mortgage or mortgages on property that Statoil or Statoil Petroleum would be entitled to create, incur, issue, guarantee or assume without equally and ratably securing the debt securities pursuant to the provisions of "—Negative Pledge" above) does not exceed 10% of Statoil's Consolidated Net Tangible Assets (defined below).
This restriction shall not apply to any Sale and Leaseback Transaction if:
|
(i)
|
Statoil or Statoil Petroleum would be entitled to create, incur, issue, guarantee or assume Debt secured by a mortgage or mortgages on the Principal Property to be leased without equally and ratably securing the Securities pursuant to the provisions of the indenture's negative pledge covenant,
|
|
(ii)
|
within a period commencing 12 months prior to the consummation of the Sale and Leaseback Transaction and ending 12 months after the consummation of such Sale and Leaseback Transaction, Statoil or Statoil Petroleum has expended or will expend for any Principal Property an amount equal to:
|
|
(a)
|
the greater of (x) the net proceeds received by Statoil or Statoil Petroleum from such Sale and Leaseback Transaction and (y) the fair market value of the Principal Property so sold at the time of entering into such transaction, as determined by the Board of Directors of Statoil or Statoil Petroleum (the greater of the sums specified in clauses (x) and (y) being referred to herein as the "Net Proceeds"), or
|
|
(b)
|
a part of the Net Proceeds and Statoil or Statoil Petroleum elects to apply the balance of such Net Proceeds in the manner described in the following clause (iii); or
|
|
(iii)
|
Statoil or Statoil Petroleum within 12 months after the consummation of any such Sale and Leaseback Transaction, applies an amount equal to the Net Proceeds (less any amount elected under clause (ii) above) to the retirement of Funded Debt of either Statoil or Statoil Petroleum ranking pari passu with the debt securities of each series. No retirement referred to in clause (iii) may be effected by payment at maturity or pursuant to any mandatory sinking fund or prepayment provision.
|
For purposes of this covenant "Attributable Debt" means, as to any lease in respect of a Sale and Leaseback Transaction, as of the date of determination, the lesser of (i) the fair value of the property subject to the Sale and Leaseback Transaction (as determined by the Board of Directors of Statoil or Statoil Petroleum) and (ii) the present value (discounted at a rate equal to the weighted average of the rate of interest on all securities then issued and outstanding under the indenture, compounded semi-annually) of the total amount of rent required to be paid under such lease during the remaining term thereof, including any period for which such lease has been extended. Such rental payments shall not include amounts payable by or on behalf of the lessee on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges.
"Consolidated Net Tangible Assets" means the aggregate amount of consolidated total assets of Statoil and its consolidated subsidiaries after deducting therefrom (a) all current liabilities and (b) all goodwill, trade names, trademarks, patents and other like intangible assets, as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of Statoil.
"Funded Debt" means any indebtedness which by its terms or by the terms of any instrument or agreement relating thereto matures, or which is otherwise payable or unpaid, more than one year from, or is directly or indirectly renewable or extendible at the option of the debtor to a date more than one year from the date of creation thereof.
Defeasance and Discharge
Full Defeasance
The following discussion of full defeasance and discharge and covenant defeasance and discharge will be applicable to your series of debt securities only if we choose to have them apply to that series. If we do so choose, we will state that in the prospectus supplement. (Section 1301).
We can legally release ourselves from any payment or other obligations on the debt securities, except for various obligations described below, if we, in addition to other actions, put in place the following arrangements for you to be repaid:
|
·
|
We must deposit in trust for your benefit and the benefit of all other direct holders of the debt securities a combination of money and U.S. government or U.S. government agency notes or bonds that will generate enough cash to make interest, principal and any other payments on the debt securities on their various due dates.
|
|
·
|
We must deliver to the trustee a legal opinion of our counsel confirming that as a result of a change in U.S. federal income tax law we may make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves or stating that we have received from, or there has been published by, the U.S. Internal Revenue Service a ruling that states the same conclusion.
|
|
·
|
If the debt securities are listed on a securities exchange, we must deliver to the trustee a legal opinion of our counsel confirming that the deposit, defeasance and discharge will not cause the debt securities to be delisted.
|
However, even if we take these actions, a number of our obligations relating to the debt securities will remain. These include the following obligations:
|
·
|
to register the transfer and exchange of debt securities;
|
|
·
|
to replace mutilated, destroyed, lost or stolen debt securities;
|
|
·
|
to maintain paying agencies; and
|
|
·
|
to hold money for payment in trust. (Section 1302).
|
Covenant Defeasance
We can be legally released from compliance with certain covenants, including those described under "Restrictive Covenants" and any that may be described in the applicable prospectus supplement and including the related Events of Default if, in addition to other actions, we take all the steps described above under "Defeasance and Discharge" except that the opinion of counsel does not have to refer to a change in United States federal income tax laws or a ruling from the United States Internal Revenue Service. (Section 1303).
If we accomplish covenant defeasance, you can still look to us for repayment of the debt securities if there is a shortfall in the trust deposit. In fact, if any event of default occurs (such as our bankruptcy) and the debt securities become immediately due and payable, there may be such a shortfall. Depending on the event causing the default, you may not be able to obtain payment of the shortfall. (Sections 1303 and 1304).
Default and Related Matters
Ranking
The debt securities are not secured by any of our property or assets. Accordingly, your ownership of debt securities means you are one of our unsecured creditors. The debt securities are not subordinated to any of our other debt obligations and therefore they rank equally with all our other unsecured and unsubordinated indebtedness.
Events of Default
You will have special rights if an event of default occurs and is not cured, as described later in this subsection.
What Is an Event of Default? The term event of default means any of the following:
|
·
|
We do not pay interest on a debt security within 30 days of its due date.
|
|
·
|
We do not pay the principal or any premium on a debt security on its due date.
|
|
·
|
We do not deposit any sinking fund payment on its due date or within any applicable grace period.
|
|
·
|
We remain in breach of any covenant or any other term of the indenture for 90 days after we receive a notice of default stating we are in breach. The notice must be sent by either the trustee or holders of at least 25 percent of the principal amount of debt securities of the affected series.
|
|
·
|
We file for bankruptcy or certain other events in bankruptcy, insolvency or reorganization occur.
|
|
·
|
Any other event of default provided with respect to securities of that series. (Section 501).
|
Remedies If an Event of Default Occurs. If an event of default has occurred and has not been cured, the trustee or the holders of not less than 25 percent in principal amount of the outstanding debt securities of the affected series may declare the entire principal amount of all the debt securities of that series (or, if any debt securities of that series are original issue discount securities, such portion of the principal amount of such securities as may be specified by the terms thereof) to be due and immediately payable, by a notice in writing to us and Statoil Petroleum (and to the trustee if given by the holders). This is called a declaration of acceleration of maturity. A declaration of acceleration of maturity may be canceled by the holders of at least a majority in principal amount of the outstanding debt securities of the affected series if certain conditions are met. (Section 502).
Except in cases of default, where the trustee has some special duties, the trustee is not required to take any action under the indenture at the request of any holders unless the holders offer the trustee reasonable protection from costs, expenses and liability. This protection is called an indemnity. (Section 603). If reasonable indemnity is provided, the holders of a majority in principal amount of the outstanding debt securities of any series may direct the time, method and place of conducting any proceeding seeking any remedy available to the trustee. These majority holders may also direct the trustee in performing any other action under the indenture. The trustee may decline to follow any such direction if the trustee in good faith determines that the proceeding so directed would involve the trustee in personal liability. (Section 512).
Before you bypass the trustee and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to the debt securities, the following must occur:
|
·
|
The trustee must be given written notice that an event of default has occurred and remains uncured.
|
|
·
|
The holders of not less than 25 percent in principal amount of all outstanding debt securities of the relevant series must make a written request that the trustee institute proceedings because of the default, and must offer reasonable indemnity to the trustee against the costs, expenses and liabilities of taking such request.
|
|
·
|
The trustee must have not taken action for 60 days after receipt of the above notice, request and offer of indemnity.
|
|
·
|
No direction inconsistent with such written request has been given to the trustee during such 60-day period by the holders of the majority in principal amount of the outstanding securities of that series. (Section 507).
|
|
·
|
However, you are entitled at any time to bring a lawsuit for the payment of money due on your security on or after its due date. (Section 508).
|
Street name and other indirect holders should consult their banks or brokers for information on how to give notice or direction to or make a request of the trustee and to make or cancel a declaration of acceleration.
|
We will furnish to the trustee every year a written statement of certain of our officers and directors certifying that, to their knowledge, we are in compliance with the indenture and the debt securities, or else specifying any default. (Section 1005).
Regarding the Trustee
Deutsche Bank Trust Company Americas will act as the trustee under the indenture. We and some of our subsidiaries maintain ordinary banking relations with the trustee and affiliates of the trustee in the ordinary course of business.
If an event of default occurs, or an event occurs that would be an event of default if the requirements for giving us default notice or our default having to exist for a specific period of time were disregarded, the trustee may therefore be considered to have a conflicting interest with respect to the debt securities or the applicable indenture for purposes of the Trust Indenture Act of 1939. In that case, the trustee may be required to resign as trustee under the applicable indenture and we would be required to appoint a successor trustee.
DESCRIPTION OF ORDINARY SHARES AND AMERICAN DEPOSITARY SHARES
For a description of Statoil's ordinary shares and American Depositary Shares, see Statoil's Form 8-A, filed on June 12, 2001, which is incorporated by reference in this prospectus, or descriptions in subsequent filings incorporated by reference in this prospectus.
CLEARANCE AND SETTLEMENT
Securities we issue may be held through one or more international and domestic clearing systems. The principal clearing systems we will use are the book-entry systems operated by The Depository Trust Company ("DTC") in the United States, Clearstream Banking, société anonyme, in Luxembourg ("Clearstream, Luxembourg") and Euroclear Bank S.A./N.V. in Brussels, Belgium ("Euroclear"). These systems have established electronic securities and payment transfer, processing, depositary and custodial links among themselves and others, either directly or through custodians and depositaries. These links allow securities to be issued, held and transferred among the clearing systems without the physical transfer of certificates.
Special procedures to facilitate clearance and settlement have been established among these clearing systems to trade securities across borders in the secondary market. Where payments for securities we issue in global form will be made in U.S. dollars, these procedures can be used for cross-market transfers and the securities will be cleared and settled on a delivery against payment basis.
Cross-market transfers of securities that are not in global form may be cleared and settled in accordance with other procedures that may be established among the clearing systems for these securities. Investors in securities that are issued outside of the United States, its territories and possessions must initially hold their interests through Euroclear, Clearstream, Luxembourg or the clearance system that is described in the applicable prospectus supplement.
The policies of DTC, Clearstream, Luxembourg and Euroclear will govern payments, transfers, exchange and other matters relating to the investor's interest in securities held by them. This is also true for any other clearance system that may be named in a prospectus supplement.
We have no responsibility for any aspect of the actions of DTC, Clearstream, Luxembourg or Euroclear or any of their direct or indirect participants. We have no responsibility for any aspect of the records kept by DTC, Clearstream, Luxembourg or Euroclear or any of their direct or indirect participants. We also do not supervise these systems in any way. This is also true for any other clearing system indicated in a prospectus supplement.
DTC, Clearstream, Luxembourg and Euroclear and their participants perform these clearance and settlement functions under agreements they have made with one another or with their customers. You should be aware that they are not obligated to perform these procedures and may modify them or discontinue them at any time.
The description of the clearing systems in this Section reflects our understanding of the rules and procedures of DTC, Clearstream, Luxembourg and Euroclear as they are currently in effect. Those systems could change their rules and procedures at any time.
The Clearing Systems
DTC
DTC has advised us as follows:
|
·
|
a limited purpose trust company organized under the laws of the State of New York;
|
|
·
|
a "banking organization" within the meaning of the New York Banking Law;
|
|
·
|
a member of the Federal Reserve System;
|
|
·
|
a "clearing corporation" within the meaning of the New York Uniform Commercial Code; and
|
|
·
|
a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934.
|
|
·
|
DTC was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between participants through electronic book-entry changes to accounts of its participants. This eliminates the need for physical movement of certificates.
|
|
·
|
Participants in DTC include securities brokers and dealers, banks, trust companies and clearing corporations and may include certain other organizations. DTC is partially owned by some of these participants or their representatives.
|
|
·
|
Indirect access to the DTC system is also available to banks, brokers, dealers and trust companies that have relationships with participants.
|
|
·
|
The rules applicable to DTC and DTC participants are on file with the SEC.
|
Clearstream, Luxembourg
Clearstream, Luxembourg has advised us as follows:
|
·
|
Clearstream, Luxembourg is a duly licensed bank organized as a société anonyme incorporated under the laws of Luxembourg and is subject to regulation by the Luxembourg Commission for the Supervision of the Financial Sector (Commission de Surveillance du Secteur Financier).
|
|
·
|
Clearstream, Luxembourg holds securities for its customers and facilitates the clearance and settlement of securities transactions among them. It does so through electronic book-entry changes to the accounts of its customers. This eliminates the need for physical movement of certificates.
|
|
·
|
Clearstream, Luxembourg provides other services to its participants, including safekeeping, administration, clearance and settlement of internationally traded securities and lending and borrowing of securities. It interfaces with the domestic markets in over 30 countries through established depositary and custodial relationships.
|
|
·
|
Clearstream, Luxembourg's customers include worldwide securities brokers and dealers, banks, trust companies and clearing corporations and may include professional financial intermediaries. Its U.S. customers are limited to securities brokers and dealers and banks.
|
|
·
|
Indirect access to the Clearstream, Luxembourg system is also available to others that clear through Clearstream, Luxembourg customers or that have custodial relationships with its customers, such as banks, brokers, dealers and trust companies.
|
Euroclear
Euroclear has advised us as follows:
|
·
|
Euroclear is incorporated under the laws of Belgium as a bank and is subject to regulation by the Belgian Banking and Finance Commission (Commission Bancaire et Financière) and the National Bank of Belgium (Banque Nationale de Belgique).
|
|
·
|
Euroclear holds securities for its customers and facilitates the clearance and settlement of securities transactions among them. It does so through simultaneous electronic book-entry delivery against payment, thereby eliminating the need for physical movement of certificates.
|
|
·
|
Euroclear provides other services to its customers, including credit custody, lending and borrowing of securities and tri-party collateral management. It interfaces with the domestic markets of several other countries.
|
|
·
|
Euroclear customers include banks, including central banks, securities brokers and dealers, trust companies and clearing corporations and may include certain other professional financial intermediaries.
|
|
·
|
Indirect access to the Euroclear system is also available to others that clear through Euroclear customers or that have custodial relationships with Euroclear customers.
|
|
·
|
All securities in Euroclear are held on a fungible basis. This means that specific certificates are not matched to specific securities clearance accounts.
|
Other Clearing Systems
We may choose any other clearing system for a particular series of securities. The clearance and settlement procedures for the clearing system we choose will be described in the applicable prospectus supplement.
Primary Distribution
The distribution of the securities will be cleared through one or more of the clearing systems that we have described above or any other clearing system that is specified in the applicable prospectus supplement. Payment for securities will be made on a delivery versus payment or free delivery basis. These payment procedures will be more fully described in the applicable prospectus supplement.
Clearance and settlement procedures may vary from one series of securities to another according to the currency that is chosen for the specific series of securities. Customary clearance and settlement procedures are described below.
We will submit applications to the relevant system or systems for the securities to be accepted for clearance. The clearance numbers that are applicable to each clearance system will be specified in the prospectus supplement.
Clearance and Settlement Procedures—DTC
DTC participants that hold securities through DTC on behalf of investors will follow the settlement practices applicable to United States corporate debt obligations in DTC's Same-Day Funds Settlement System, or such other procedures as are applicable for other securities.
Securities will be credited to the securities custody accounts of these DTC participants against payment in same-day funds, for payments in U.S. dollars, on the settlement date. For payments in a currency other than U.S. dollars, securities will be credited free of payment on the settlement date.
Clearance and Settlement Procedures—Euroclear and Clearstream, Luxembourg
We understand that investors that hold their securities through Euroclear or Clearstream, Luxembourg accounts will follow the settlement procedures that are applicable to conventional Eurobonds in registered form for debt securities, or such other procedures as are applicable for other securities.
Securities will be credited to the securities custody accounts of Euroclear and Clearstream, Luxembourg participants on the business day following the settlement date, for value on the settlement date. They will be credited either free of payment or against payment for value on the settlement date.
Secondary Market Trading
Trading between DTC Participants
Secondary market trading between DTC participants will occur in the ordinary way in accordance with DTC's rules. Secondary market trading will be settled using procedures applicable to United States corporate debt obligations in DTC's Same-Day Funds Settlement System for debt securities, or such other procedures as are applicable for other securities.
If payment is made in U.S. dollars, settlement will be in same-day funds. If payment is made in a currency other than U.S. dollars, settlement will be free of payment. If payment is made other than in U.S. dollars, separate payment arrangements outside of the DTC system must be made between the DTC participants involved.
Trading between Euroclear and/or Clearstream, Luxembourg Participants
We understand that secondary market trading between Euroclear and/or Clearstream, Luxembourg participants will occur in the ordinary way following the applicable rules and operating procedures of Euroclear and Clearstream, Luxembourg. Secondary market trading will be settled using procedures applicable to conventional Eurobonds in registered form for debt securities, or such other procedures as are applicable for other securities.
Trading between a DTC Seller and a Euroclear or Clearstream, Luxembourg Purchaser
A purchaser of securities that are held in the account of a DTC participant must send instructions to Euroclear or Clearstream, Luxembourg at least one business day prior to settlement. The instructions will provide for the transfer of the securities from the selling DTC participant's account to the account of the purchasing Euroclear or Clearstream, Luxembourg participant. Euroclear or Clearstream, Luxembourg, as the case may be, will then instruct the common depositary for Euroclear and Clearstream, Luxembourg to receive the securities either against payment or free of payment.
The interests in the securities will be credited to the respective clearing system. The clearing system will then credit the account of the participant, following its usual procedures. Credit for the securities will appear on the next day, European time. Cash debit will be back-valued to, and the interest on the securities will accrue from, the value date, which would be the preceding day, when settlement occurs in New York. If the trade fails and settlement is not completed on the intended date, the Euroclear or Clearstream, Luxembourg cash debit will be valued as of the actual settlement date instead.
Euroclear participants or Clearstream, Luxembourg participants will need the funds necessary to process same-day funds settlement. The most direct means of doing this is to preposition funds for settlement, either from cash or from existing lines of credit, as for any settlement occurring within Euroclear or Clearstream, Luxembourg. Under this approach, participants may take on credit exposure to Euroclear or Clearstream, Luxembourg until the securities are credited to their accounts one business day later.
As an alternative, if Euroclear or Clearstream, Luxembourg has extended a line of credit to them, participants can choose not to preposition funds and will instead allow that credit line to be drawn upon to finance settlement. Under this procedure, Euroclear participants or Clearstream, Luxembourg participants purchasing securities would incur overdraft charges for one business day (assuming they cleared the overdraft as soon as the securities were credited to their accounts). However, interest on the securities would accrue from the value date. Therefore, in many cases, the investment income on securities that is earned during that one business day period may substantially reduce or offset the amount of the overdraft charges. This result will, however, depend on each participant's particular cost of funds.
Because the settlement will take place during New York business hours, DTC participants will use their usual procedures to deliver securities to the depositary on behalf of Euroclear participants or Clearstream, Luxembourg participants. The sale proceeds will be available to the DTC seller on the settlement date. For the DTC participants, then, a cross-market transaction will settle no differently than a trade between two DTC participants.
Special Timing Considerations
You should be aware that investors will only be able to make and receive deliveries, payments and other communications involving the securities through Clearstream, Luxembourg and Euroclear on days when those systems are open for business. Those systems may not be open for business on days when banks, brokers and other institutions are open for business in the United States.
In addition, because of time-zone differences, there may be problems with completing transactions involving Clearstream, Luxembourg and Euroclear on the same business day as in the United States. U.S. investors who wish to transfer their interests in the securities, or to receive or make a payment or delivery of the securities, on a particular day, may find that the transactions will not be performed until the next business day in Luxembourg or Brussels, depending on whether Clearstream, Luxembourg or Euroclear is used.
TAXATION
United States Taxation
This Section describes the material United States federal income tax consequences of acquiring, owning and disposing of securities we may offer pursuant to this prospectus. It applies to you only if you acquire the offered securities in an offering or offerings contemplated by this prospectus and you hold the offered securities as capital assets for tax purposes. This Section is the opinion of Sullivan & Cromwell LLP, U.S. counsel to Statoil. This Section does not apply to you if you are a member of a special class of holders subject to special rules, including:
|
·
|
a dealer in securities or currencies,
|
|
·
|
a trader in securities that elects to use a mark-to-market method of accounting for its securities holdings,
|
|
·
|
a tax-exempt organization,
|
|
·
|
a life insurance company,
|
|
·
|
in the case of debt securities, a bank,
|
|
·
|
in the case of shares or ADSs, a person that actually or constructively owns 10 percent or more of the voting stock of Statoil,
|
|
·
|
a person that holds offered securities as part of a straddle or a hedging or conversion transaction (including, in the case of debt securities, debt securities owned as a hedge, or that are hedged, against interest rate or currency risks),
|
|
·
|
a person liable for alternative minimum tax,
|
|
·
|
a person that purchases or sells securities as part of a wash sale for tax purposes, or
|
|
·
|
a United States holder (as defined below) whose functional currency is not the U.S. dollar.
|
This Section is based on the Internal Revenue Code of 1986, as amended (the "Code"), its legislative history, existing and proposed regulations under the Code, published rulings and court decisions, all as of the date hereof. These laws are subject to change, possibly on a retroactive basis.
You are a United States holder if you are a beneficial owner of an offered security and you are for United States federal income tax purposes:
|
·
|
a citizen or resident of the United States,
|
|
·
|
a domestic corporation,
|
|
·
|
an estate whose income is subject to United States federal income tax regardless of its source, or
|
|
·
|
a trust if a United States court can exercise primary supervision over the trust's administration and one or more United States persons are authorized to control all substantial decisions of the trust.
|
You are a United States alien holder if you are the beneficial owner of an offered security and are, for United States federal income tax purposes:
|
·
|
a non-resident alien individual;
|
|
·
|
a foreign corporation; or
|
|
·
|
an estate or trust that in either case is not subject to United States federal income tax on a net income basis on income or gain from the security.
|
If a partnership holds the offered securities, the United States federal income tax treatment of a partner will generally depend on the status of the partner and the tax treatment of the partnership. A partner in a partnership holding the offered securities should consult its tax advisor with regard to the United States federal income tax treatment of an investment in the offered securities.
Medicare Tax
For taxable years beginning after December 31, 2012, a U.S. person that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on the lesser of (1) the U.S. person's "net investment income" for the relevant taxable year (or undistributed net investment income in the case of an estate or trust) and (2) the excess of the U.S. person's modified gross income (or adjusted gross income in the case of an estate or trust) for the taxable year over a certain threshold (which in the case of individuals will be between $125,000 and $250,000, depending on the individual's circumstances). A U.S. holder's net investment income generally includes its dividend income, interest income, and its net gains from the disposition of shares, ADSs, or debt securities, unless such dividends, interest payments, or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). If you are a U.S. person that is an individual, estate or trust, you are advised to consult your tax advisors regarding the applicability of the Medicare tax to your income and gains in respect of your investment in the shares, ADSs, or debt securities.
Information with Respect to Foreign Financial Assets
Owners of "specified foreign financial assets" with an aggregate value in excess of $50,000 (and in some circumstances, a higher threshold) may be required to file an information report with respect to such assets with their tax returns. "Specified foreign financial assets" may include any financial accounts maintained by non-U.S. financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities issued by non-U.S. persons, (ii) financial instruments and contracts held for investment that have non-U.S. issuers or counterparties and (iii) interests in foreign entities. U.S. holders that are individuals are advised to consult their tax advisors regarding the application of this reporting requirement to their ownership of the shares, ADSs, or debt securities.
You should consult your own tax advisor regarding the United States federal, state and local and other tax consequences of owning and disposing of offered securities in your particular circumstances.
|
United States Taxation of Debt Securities
This discussion describes the principal United States federal income tax consequences of owning the debt securities described in this prospectus.
This discussion deals only with debt securities that are due to mature 30 years or less from the date on which they are issued. The United States federal income tax consequences of owning debt securities that are due to mature more than 30 years from their date of issue and any other debt securities with special United States federal income tax consequences will be discussed in the applicable prospectus supplement.
United States Holders
If you are not a United States holder, this Section does not apply to you, and you should see the sections entitled "United States Alien Holders" below for information that may apply to you.
Payments of Interest. Except as described below in the case of interest on a "discount debt security" that is not "qualified stated interest", each as defined later under "Original Issue Discount—General", you will be taxed on any interest on your debt security, whether payable in U.S. dollars or a currency, composite currency or basket of currencies other than U.S. dollars, as ordinary income at the time you receive the interest or at the time it accrues, depending on your method of accounting for tax purposes. We refer to a currency, composite currency or basket of currencies other than U.S. dollars as foreign currency throughout this section.
Interest paid by us on the debt securities and original issue discount (as described later under "Original Issue Discount"), if any, accrued with respect to the debt securities and any additional amounts paid with respect to withholding tax on the debt securities, including withholding tax on payments of such additional amounts, is income from sources outside the United States and will, depending on your circumstances, be either "passive" or "general" income for purposes of the rules regarding the foreign tax credit allowable to a United States holder.
Cash Basis Taxpayers. If you are a taxpayer that uses the "cash receipts and disbursements" method of accounting for tax purposes and you receive an interest payment that is denominated in, or determined by reference to, a foreign currency, you must recognize income equal to the U.S. dollar value of the interest payment, based on the exchange rate in effect on the date of receipt, regardless of whether you actually convert the payment into U.S. dollars on such date.
Accrual Basis Taxpayers. If you are a taxpayer that uses the accrual method of accounting for tax purposes, you may determine the amount of income that you recognize with respect to an interest payment denominated in, or determined by reference to, a foreign currency by using one of two methods. Under the first method, you will determine the amount of income accrued based on the average exchange rate in effect during the interest accrual period (or, with respect to an accrual period that spans two taxable years, that part of the period within the taxable year).
If you elect the second method, you would determine the amount of income accrued on the basis of the exchange rate in effect on the last day of the accrual period (or, in the case of an accrual period that spans two taxable years, the exchange rate in effect on the last day of the part of the period within the taxable year). Additionally, under this second method, if you receive a payment of interest within five business days of the last day of your accrual period or taxable year, you may instead translate the interest accrued into U.S. dollars at the exchange rate in effect on the day that you actually receive the interest payment. If you elect the second method, it will apply to all debt instruments that you own at the beginning of the first taxable year to which the election applies and to all debt instruments that you thereafter acquire. You may not revoke this election without the consent of the Internal Revenue Service.
When you actually receive an interest payment, including a payment attributable to accrued but unpaid interest upon the sale or retirement of your debt security, denominated in, or determined by reference to, a foreign currency for which you accrued an amount of income, you will recognize ordinary income or loss equal to the difference, if any, between the amount received (translated into U.S. dollars at the spot rate on the date of receipt) and the amount previously accrued, regardless of whether you actually convert the payment into U.S. dollars on such date.
Original Issue Discount. General. If you own a debt security, other than a debt security with a term of one year or less, referred to as a "short-term debt security", it will be treated as issued at an original issue discount, and referred to as a "discount debt security", if the amount by which the debt security's "stated redemption price at maturity" exceeds its "issue price" is equal to or more than a "de minimis amount".
All three terms are defined below. Generally, a debt security's "issue price" will be the first price at which a substantial amount of debt securities included in the issue of which the debt security is a part are sold for cash to persons other than bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents, or wholesalers. A debt security's "stated redemption price at maturity" is the total of all payments provided by the debt security that are not payments of "qualified stated interest". Generally, an interest payment on a debt security is "qualified stated interest" if it is one of a series of stated interest payments on a debt security that are unconditionally payable at least annually at a single fixed rate (with certain exceptions for lower rates paid during some periods) applied to the outstanding principal amount of the debt security. There are special rules for "variable rate debt securities" that we discuss below under "Variable Rate Debt Securities".
In general, your debt security is not a discount debt security if the amount by which its "stated redemption price at maturity" exceeds its "issue price" is less than ¼ of 1 percent of its stated redemption price at maturity multiplied by the number of complete years to its maturity, referred to as the "de minimis amount". Your debt security will have "de minimis original issue discount" if the amount of the excess is less than the de minimis amount. If your debt security has "de minimis original issue discount", you must include it in income as stated principal payments are made on the debt security, unless you make the election described below under "Election to Treat All Interest as Original Issue Discount". You can determine the includible amount with respect to each such payment by multiplying the total amount of your debt security's de minimis original issue discount by a fraction equal to:
|
·
|
the amount of the principal payment made
|
divided by:
|
·
|
the stated principal amount of the debt security.
|
Inclusion of Original Issue Discount in Income. Generally, if your discount debt security matures more than one year from its date of issue, you must include original issue discount, or OID, with respect to your discount debt security in income before you receive cash attributable to that income. The amount of OID that you must include in income is calculated using a constant-yield method, and generally you will include increasingly greater amounts of OID in income over the life of your discount debt security. More specifically, you can calculate the amount of OID that you must include in income by adding the daily portions of OID with respect to your discount debt security for each day during the taxable year or portion of the taxable year that you own your discount debt security, referred to as "accrued OID". You can determine the daily portion by allocating to each day in any "accrual period" a pro rata portion of the OID allocable to that accrual period. You may select an accrual period of any length with respect to your discount debt security and you may vary the length of each accrual period over the term of your discount debt security. However, no accrual period may be longer than one year and each scheduled payment of interest or principal on your discount debt security must occur on either the first or final day of an accrual period.
You can determine the amount of OID allocable to an accrual period by:
|
·
|
multiplying your discount debt security's adjusted issue price at the beginning of the accrual period by your debt security's yield to maturity, and then
|
|
·
|
subtracting from this figure the sum of the payments of qualified stated interest on your debt security allocable to the accrual period.
|
You must determine the discount debt security's yield to maturity on the basis of compounding at the close of each accrual period and adjusting for the length of each accrual period. Further, you determine your discount debt security's adjusted issue price at the beginning of any accrual period by:
|
·
|
adding your discount debt security's issue price and any accrued OID for each prior accrual period, and then
|
|
·
|
subtracting any payments previously made on your discount debt security that were not qualified stated interest payments.
|
If an interval between payments of qualified stated interest on your discount debt security contains more than one accrual period, then, when you determine the amount of OID allocable to an accrual period, you must allocate the amount of qualified stated interest payable at the end of the interval (including any qualified stated interest that is payable on the first day of the accrual period immediately following the interval) pro rata to each accrual period in the interval based on their relative lengths. In addition, you must increase the adjusted issue price at the beginning of each accrual period in the interval by the amount of any qualified stated interest that has accrued prior to the first day of the accrual period but that is not payable until the end of the interval. You may compute the amount of OID allocable to an initial short accrual period by using any reasonable method if all other accrual periods, other than a final short accrual period, are of equal length.
The amount of OID allocable to the final accrual period is equal to the difference between:
|
·
|
the amount payable at the maturity of your debt security (other than any payment of qualified stated interest); and
|
|
·
|
your debt security's adjusted issue price as of the beginning of the final accrual period.
|
Acquisition Premium. If you purchase your debt security for an amount that is less than or equal to the sum of all amounts (other than qualified stated interest) payable on your debt security after the purchase date but is greater than the amount of your debt security's adjusted issue price (as determined above under "Inclusion of Original Issue Discount in Income"), the excess is "acquisition premium". If you do not make the election described below under "Election to Treat All Interest as Original Issue Discount", then you must reduce the daily portions of OID by an amount equal to:
|
·
|
the excess of your adjusted basis in the debt security immediately after purchase over the adjusted issue price of your debt security
|
divided by:
|
·
|
the excess of the sum of all amounts payable (other than qualified stated interest) on your debt security after the purchase date over your debt security's adjusted issue price.
|
Pre-Issuance Accrued Interest. An election may be made to decrease the issue price of your debt security by the amount of interest that has accrued prior to your debt security's issue date ("pre-issuance accrued interest") if:
|
·
|
a portion of the initial purchase price of your debt security is attributable to pre-issuance accrued interest;
|
|
·
|
the first stated interest payment on your debt security is to be made within one year of your debt security's issue date; and
|
|
·
|
the payment will equal or exceed the amount of pre-issuance accrued interest.
|
If this election is made, a portion of the first stated interest payment will be treated as a return of the excluded pre-issuance accrued interest and not as an amount of interest payable on your debt security and the amount of pre-issuance accrued interest is subtracted from the debt security's issue price.
Debt Securities Subject to Contingencies Including Optional Redemption. Your debt security is subject to a contingency if it provides for an alternative payment schedule or schedules applicable upon the occurrence of a contingency or contingencies (other than a remote or incidental contingency), whether such contingency relates to payments of interest or of principal. In such a case, you must determine the yield and maturity of your debt security by assuming that the payments will be made according to the payment schedule most likely to occur if:
|
·
|
the timing and amounts of the payments that comprise each payment schedule are known as of the issue date; and
|
|
·
|
one of such schedules is significantly more likely than not to occur.
|
If there is no single payment schedule that is significantly more likely than not to occur (other than because of a mandatory sinking fund or certain options discussed below), you must include income on your debt security in accordance with the general rules that govern contingent payment obligations. These rules will be discussed in the applicable prospectus supplement.
Notwithstanding the general rules for determining yield and maturity, if your debt security is subject to contingencies, and either you or we have an unconditional option or options that, if exercised, would require payments to be made on the debt security under an alternative payment schedule or schedules, then:
|
·
|
in the case of an option or options that we may exercise, we will be deemed to exercise or not exercise an option or combination of options in the manner that minimizes the yield on your debt security; and
|
|
·
|
in the case of an option or options that you may exercise, you will be deemed to exercise or not exercise an option or combination of options in the manner that maximizes the yield on your debt security.
|
If both you and we hold options described in the preceding sentence, those rules will apply to each option in the order in which they may be exercised. You will determine the yield on your debt security for the purposes of those calculations by using any date on which your debt security may be redeemed or repurchased as the maturity date and the amount payable on the date that you chose in accordance with the terms of your debt security as the principal amount payable at maturity.
If a contingency (including the exercise of an option) actually occurs or does not occur contrary to an assumption made according to the above rules, referred to as a "change in circumstances", then, except to the extent that a portion of your debt security is repaid as a result of the change in circumstances and solely to determine the amount and accrual of OID, you must re-determine the yield and maturity of your debt security by treating your debt security as having been retired and reissued on the date of the change in circumstances for an amount equal to your debt security's adjusted issue price on that date.
Election to Treat All Interest as Original Issue Discount. You may elect to include in gross income all interest that accrues on your debt security using the constant-yield method described above under the heading "Inclusion of Original Issue Discount in Income", with the modifications described below. For purposes of this election, interest will include stated interest, OID, de minimis original issue discount, market discount, de minimis market discount and unstated interest, as adjusted by any amortizable bond premium (described below under "Debt Securities Purchased at a Premium") or acquisition premium.
If you make this election for your debt security, then, when you apply the constant-yield method:
|
·
|
the "issue price" of your debt security will equal your cost;
|
|
·
|
the issue date of your debt security will be the date you acquired it; and
|
|
·
|
no payments on your debt security will be treated as payments of qualified stated interest.
|
Generally, this election will apply only to the debt security for which you make it; however, if the debt security for which this election is made has amortizable bond premium, you will be deemed to have made an election to apply amortizable bond premium against interest for all debt instruments with amortizable bond premium (other than debt instruments the interest on which is excludible from gross income) that you own as of the beginning of the taxable year in which you acquire the debt security for which you made this election or which you acquire thereafter. Additionally, if you make this election for a market discount debt security, you will be treated as having made the election discussed below under "Market Discount" to include market discount in income currently over the life of all debt instruments having market discount that you acquire on or after the first day of the first taxable year to which the election applies. You may not revoke any election to apply the constant-yield method to all interest on a debt security or the deemed elections with respect to amortizable bond premium or market discount debt securities without the consent of the Internal Revenue Service.
Variable Rate Debt Securities. Your debt security will be a "variable rate debt security" if:
|
·
|
your debt security's "issue price" does not exceed the total non-contingent principal payments by more than the lesser of:
|
|
·
|
0.015 multiplied by the product of the total non-contingent principal payments and the number of complete years to maturity from the issue date; or
|
|
·
|
15 percent of the total non-contingent principal payments; and
|
|
·
|
your debt security provides for stated interest (compounded or paid at least annually) only at:
|
|
·
|
one or more "qualified floating rates";
|
|
·
|
a single fixed rate and one or more qualified floating rates;
|
|
·
|
a single "objective rate"; or
|
|
·
|
a single fixed rate and a single objective rate that is a "qualified inverse floating rate".
|
Your debt security will have a variable rate that is a "qualified floating rate" if:
|
·
|
variations in the value of the rate can reasonably be expected to measure contemporaneous variations in the cost of newly borrowed funds in the currency in which your debt security is denominated; or
|
|
·
|
the rate is equal to such a rate multiplied by either:
|
|
·
|
a fixed multiple that is greater than 0.65 but not more than 1.35; or
|
|
·
|
a fixed multiple greater than 0.65 but not more than 1.35, increased or decreased by a fixed rate; and
|
|
·
|
the value of the rate on any date during the term of your debt security is set no earlier than three months prior to the first day on which that value is in effect and no later than one year following that first day.
|
If your debt security provides for two or more qualified floating rates that are within 0.25 percentage points of each other on the issue date or can reasonably be expected to have approximately the same values throughout the term of the debt security, the qualified floating rates together constitute a single qualified floating rate.
Your debt security will not have a qualified floating rate, however, if the rate is subject to certain restrictions, including caps, floors, governors, or other similar restrictions, unless such restrictions are fixed throughout the term of the debt security or are not reasonably expected to significantly affect the yield on the debt security.
Your debt security will have a variable rate that is a single "objective rate" if:
|
·
|
the rate is not a qualified floating rate;
|
|
·
|
the rate is determined using a single, fixed formula that is based on objective financial or economic information that is not within the control of or unique to the circumstances of the issuer or a related party; and
|
|
·
|
the value of the rate on any date during the term of your debt security is set no earlier than three months prior to the first day on which that value is in effect and no later than one year following that first day.
|
Your debt security will not have a variable rate that is an objective rate, however, if it is reasonably expected that the average value of the rate during the first half of your debt security's term will be either significantly less than or significantly greater than the average value of the rate during the final half of your debt security's term.
An objective rate as described above is a "qualified inverse floating rate" if:
|
·
|
the rate is equal to a fixed rate minus a qualified floating rate; and
|
|
·
|
the variations in the rate can reasonably be expected to inversely reflect contemporaneous variations in the cost of newly borrowed funds.
|
Your debt security will also have a single qualified floating rate or an objective rate if interest on your debt security is stated at a fixed rate for an initial period of one year or less followed by either a qualified floating rate or an objective rate for a subsequent period, and either:
|
·
|
the fixed rate and the qualified floating rate or objective rate have values on the issue date of the debt security that do not differ by more than 0.25 percentage points; or
|
|
·
|
the value of the qualified floating rate or objective rate is intended to approximate the fixed rate.
|
In general, if your variable rate debt security provides for stated interest at a single qualified floating rate or objective rate, or for one of those rates after a single fixed rate for an initial period, all stated interest on your debt security is qualified stated interest. In this case, the amount of OID, if any, is determined by using, in the case of a qualified floating rate or qualified inverse floating rate, the value as of the issue date of the qualified floating rate or qualified inverse floating rate, or, for any other objective rate, a fixed rate that reflects the yield reasonably expected for your debt security.
If your variable rate debt security does not provide for stated interest at a single qualified floating rate or a single objective rate, and also does not provide for interest payable at a fixed rate, other than at a single fixed rate for an initial period, you generally must determine the interest and OID accruals on your debt security by:
|
·
|
determining a fixed rate substitute for each variable rate provided under your variable rate debt security;
|
|
·
|
constructing the equivalent fixed rate debt instrument, using the fixed rate substitute described above;
|
|
·
|
determining the amount of qualified stated interest and OID with respect to the equivalent fixed rate debt instrument; and
|
|
·
|
adjusting for actual variable rates during the applicable accrual period.
|
When you determine the fixed rate substitute for each variable rate provided under the variable rate debt security, you generally will use the value of each variable rate as of the issue date or, for an objective rate that is not a qualified inverse floating rate, a rate that reflects the reasonably expected yield on your debt security.
If your variable rate debt security provides for stated interest either at one or more qualified floating rates or at a qualified inverse floating rate, and also provides for stated interest at a single fixed rate, other than at a single fixed rate for an initial period, you generally must determine interest and OID accruals by using the method described in the previous paragraph. However, your variable rate debt security will be treated, for purposes of the first three steps of the determination, as if your debt security had provided for a qualified floating rate, or a qualified inverse floating rate, rather than the fixed rate. The qualified floating rate, or qualified inverse floating rate, that replaces the fixed rate must be such that the fair market value of your variable rate debt security as of the issue date approximates the fair market value of an otherwise identical debt instrument that provides for the qualified floating rate, or qualified inverse floating rate, rather than the fixed rate.
Short-Term Debt Securities. In general, if you are an individual or other cash basis United States holder of a short-term debt security, you are not required to accrue OID (as specially defined below for the purposes of this paragraph) for United States federal income tax purposes unless you elect to do so. However, you may be required to include any stated interest in income as you receive it. If you are an accrual basis taxpayer, a taxpayer in a special class, including, but not limited to, a regulated investment company, common trust fund, or a certain type of pass through entity, or a cash basis taxpayer who so elects, you will be required to accrue OID on short-term debt securities on a straight-line basis, unless you make an election to accrue OID under a constant-yield method, based on daily compounding. If you are not required and do not elect to include OID in income currently, any gain you realize on the sale or retirement of your short-term debt security will be ordinary income to the extent of the OID accrued on a straight-line basis, unless you make an election to accrue the OID under the constant-yield method, through the date of sale or retirement. However, if you are not required and do not elect to accrue OID on your short-term debt securities, you will be required to defer deductions for interest on borrowings allocable to your short-term debt securities in an amount not exceeding the deferred income until the deferred income is realized.
When you determine the amount of OID subject to these rules, you must include all interest payments on your short-term debt security, including stated interest, in your short-term debt security's stated redemption price at maturity.
Foreign Currency Discount Debt Securities. You must determine OID for any accrual period on your discount debt security if it is denominated in, or determined by reference to, a foreign currency in the foreign currency and then translate the amount of OID into U.S. dollars in the same manner as stated interest accrued by an accrual basis United States holder, as described above under "Payments of Interest". You may recognize ordinary income or loss when you receive an amount attributable to OID in connection with a payment of interest or the sale or retirement of your debt security.
Debt Securities Purchased at a Premium. If you purchase your debt security for an amount in excess of all amounts payable on the debt security after the acquisition date, other than payments of qualified stated interest, you may elect to treat the excess as "amortizable bond premium". If you make this election, you will reduce the amount required to be included in your income each year with respect to interest on your debt security by the amount of amortizable bond premium allocable, based on your debt security's yield to maturity, to that year. If your debt security is denominated in, or determined by reference to, a foreign currency, you will compute your amortizable bond premium in units of the foreign currency and your amortizable bond premium will reduce your interest income in units of the foreign currency. Gain or loss recognized that is attributable to changes in exchange rates between the time your amortized bond premium offsets interest income and the time of the acquisition of your debt security is generally taxable as ordinary income or loss. If you make an election to amortize bond premium, it will apply to all debt instruments, other than debt instruments the interest on which is excludible from gross income, that you own at the beginning of the first taxable year to which the election applies, and to all debt instruments that you thereafter acquire, and you may not revoke it without the consent of the Internal Revenue Service. See also "Election to Treat All Interest as Original Issue Discount" above.
Market Discount. You will be treated as if you purchased your debt security, other than a short-term debt security, at a market discount and your debt security will be a "market discount debt security" if:
|
·
|
you purchase your debt security for less than its issue price (as determined above under "—Original Issue Discount—General"); and
|
|
·
|
your debt security's stated redemption price at maturity or, in the case of a discount debt security, the debt security's "revised issue price", exceeds the price you paid for your debt security by at least 1/4 of 1 percent of your debt security's stated redemption price at maturity or revised issue price, respectively, multiplied by the number of complete years to the debt security's maturity.
|
To determine the "revised issue price" of your debt security for these purposes, you generally add any OID that has accrued on your debt security to its "issue price".
If your debt security's stated redemption price at maturity or, in the case of a discount debt security, its "revised issue price", does not exceed the price you paid for the debt security by ¼ of one percent multiplied by the number of complete years to the debt security's maturity, the excess constitutes "de minimis market discount", and the rules that we discuss below are not applicable to you.
If you recognize gain on the maturity or disposition of your market discount debt security, you must treat it as ordinary income to the extent of the accrued market discount on your debt security. Alternatively, you may elect to currently include market discount in income over the life of your debt security. If you make this election, it will apply to all debt instruments with market discount that you acquire on or after the first day of the first taxable year to which the election applies. You may not revoke this election without the consent of the Internal Revenue Service. You will accrue market discount on your market discount debt security on a straight-line basis unless you elect to accrue market discount using a constant-yield method. If you make this election to accrue market discount using a constant-yield method, it will apply only to the debt security with respect to which it is made and you may not revoke it.
If you own a market discount debt security and do not elect to include market discount in income currently, you will generally be required to defer deductions for interest on borrowings allocable to your debt security in an amount not exceeding the accrued market discount on your debt security until the maturity or disposition of your debt security.
Purchase, Sale and Retirement of the Debt Securities. Your tax basis in your debt security will generally be the U.S. dollar cost, as defined below, of your debt security, adjusted by:
|
·
|
adding any OID market discount, or any other amounts treated as original issue discount (as described under "Election to Treat All Interest as Original Issue Discount" above) previously included in income with respect to your debt security, and then
|
|
·
|
subtracting the amount of any payments on your debt security that are not qualified stated interest payments and the amount of any amortizable bond premium applied to reduce interest on your debt security.
|
If you purchase your debt security with foreign currency, the U.S. dollar cost of your debt security will generally be the U.S. dollar value of the purchase price on the date of purchase. However, if you are a cash basis taxpayer (or an accrual basis taxpayer, if you so elect), and your debt security is traded on an established securities market, as defined in the applicable Treasury regulations, the U.S. dollar cost of your debt security will be the U.S. dollar value of the purchase price on the settlement date of your purchase.
You will generally recognize gain or loss on the sale or retirement of your debt security equal to the difference between the amount you realize on the sale or retirement, excluding any amounts attributable to accrued but unpaid interest (which will be treated as interest payments) and your tax basis in your debt security. If your debt security is sold or retired for an amount in foreign currency, the amount you realize will be the U.S. dollar value of such amount on:
|
·
|
the date payment is received, if you are a cash basis taxpayer and the debt securities are not traded on an established securities market, as defined in the applicable Treasury regulation;
|
|
·
|
the date of disposition, if you are an accrual basis taxpayer; or
|
|
·
|
the settlement date for the sale, if you are a cash basis taxpayer (or an accrual basis taxpayer if you so elect) and the debt securities are traded on an established securities market, as defined in the applicable Treasury regulations.
|
You will recognize capital gain or loss when you sell or retire your debt security, except to the extent:
|
·
|
attributable to changes in exchange rates as described in the next paragraph;
|
|
·
|
described above under "Original Issue Discount—Short-Term Debt Securities" or "Market Discount"; or
|
|
·
|
the rules governing contingent payment obligations apply.
|
Capital gain of a non-corporate United States holder is generally taxed at preferential rates where the debt security is held for more than one year.
You must treat any portion of the gain or loss that you recognize on the sale or retirement of a debt security as ordinary income or loss to the extent attributable to changes in exchange rates. However, you only take exchange gain or loss into account to the extent of the total gain or loss you realize on the transaction.
Exchange of Amounts in Currencies Other Than U.S. Dollars. If you receive foreign currency as interest on your debt security or on the sale or retirement of your debt security, your tax basis in the foreign currency will equal its U.S. dollar value when the interest is received or at the time of the sale or retirement. If you purchase foreign currency, you generally will have a tax basis equal to the U.S. dollar value of the foreign currency on the date of your purchase. If you sell or dispose of a foreign currency, including if you use it to purchase debt securities or exchange it for U.S. dollars, any gain or loss recognized generally will be ordinary income or loss from sources within the United States.
Indexed Debt Securities. The applicable prospectus supplement will discuss any special United States federal income tax rules with respect to debt securities the payments on which are determined by reference to any index and debt securities that are subject to the rules governing contingent payment obligations.
United States Alien Holders
This section describes the United States federal income tax consequences to a United States alien holder of acquiring, owning and disposing of debt securities issued by us. If you are a United States holder, this subsection does not apply to you.
Under United States federal income and estate tax law, and, subject to the discussion of backup withholding below, if you are a United States alien holder of a debt security, interest on a debt security paid to you is exempt from United States federal income tax, including withholding tax, whether or not you are engaged in a trade or business in the United States, unless:
|
·
|
you are an insurance company carrying on a United States insurance business to which the interest is attributable, within the meaning of the Internal Revenue Code, or
|
|
·
|
have an office or other fixed place of business in the United States to which the interest is attributable, and
|
|
·
|
derive the interest in the active conduct of a banking, financing or similar business within the United States, or are a corporation with a principal business of trading in stocks and securities for its own account.
|
Purchase, Sale, Retirement and Other Disposition of the Debt Securities. If you are a United States alien holder of a debt security, you generally will not be subject to United States federal income tax on gain realized on the sale, exchange or retirement of a debt security unless:
|
·
|
the gain is effectively connected with your conduct of a trade or business in the United States, or
|
|
·
|
you are an individual, you are present in the United States for 183 or more days during the taxable year in which the gain is realized and certain other conditions exist.
|
For purposes of the United States federal estate tax, the debt securities will be treated as situated outside the United States and will not be includible in the gross estate of a holder who is neither a citizen nor a resident of the United States at the time of death.
Treasury Regulations Requiring Disclosure of Reportable Transactions
Treasury regulations require United States taxpayers to report certain transactions that give rise to a loss in excess of certain thresholds (a "Reportable Transaction"). Under these regulations, if the debt securities are denominated in a foreign currency, a United States holder (or a United States alien holder that holds the debt securities in connection with a U.S. trade or business) that recognizes a loss with respect to the debt securities that is characterized as an ordinary loss due to changes in currency exchange rates (under any of the rules discussed above) would be required to report the loss on Internal Revenue Service Form 8886 (Reportable Transaction Statement) if the loss exceeds the thresholds set forth in the regulations. For individuals and trusts, this loss threshold is $50,000 in any single taxable year. For other types of taxpayers and other types of losses, the thresholds are higher. You should consult with your tax advisor regarding any tax filing and reporting obligations that may apply in connection with acquiring, owning and disposing of debt securities.
Backup Withholding and Information Reporting
This section describes the backup withholding and information reporting relating to holders of debt securities.
If you are a non-corporate United States holder, information reporting requirements, on Internal Revenue Service Form 1099, generally will apply to:
|
·
|
payments of principal and interest on a debt security within the United States, including payments made by wire transfer from outside the United States to an account you maintain in the United States, and
|
|
·
|
the payment of the proceeds from the sale of a debt security effected at a United States office of a broker.
|
Additionally, backup withholding will apply to such payments if you are a non-corporate United States holder that:
|
·
|
fails to provide an accurate taxpayer identification number,
|
|
·
|
is notified by the Internal Revenue Service that you have failed to report all interest and dividends required to be shown on your federal income tax returns, or
|
|
·
|
in certain circumstances, fails to comply with applicable certification requirements.
|
If you are a United States alien holder, you are generally exempt from backup withholding and information reporting requirements with respect to:
|
·
|
payments of principal and interest made to you outside the United States by the Issuer or another non-United States payor and
|
|
·
|
other payments of principal and interest and the payment of the proceeds from the sale of a debt security effected at a United States office of a broker, as long as the income associated with such payments is otherwise exempt from United States federal income tax, and:
|
|
·
|
the payor or broker does not have actual knowledge or reason to know that you are a United States person and you have furnished to the payor or broker:
|
|
·
|
an Internal Revenue Service Form W-8BEN or an acceptable substitute form upon which you certify, under penalties of perjury, that you are a non-United States person, or
|
|
·
|
other documentation upon which it may rely to treat the payments as made to a non-United States person in accordance with U.S. Treasury regulations, or
|
|
·
|
you otherwise establish an exemption.
|
Payment of the proceeds from the sale of a debt security effected at a foreign office of a broker generally will not be subject to information reporting or backup withholding. However, a sale of a debt security that is effected at a foreign office of a broker will be subject to information reporting and backup withholding if:
|
·
|
the proceeds are transferred to an account maintained by you in the United States,
|
|
·
|
the payment of proceeds or the confirmation of the sale is mailed to you at a United States address, or
|
|
·
|
the sale has some other specified connection with the United States as provided in U.S. Treasury regulations,
|
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above are met or you otherwise establish an exemption.
In addition, a sale of a debt security effected at a foreign office of a broker will be subject to information reporting if the broker is:
|
·
|
a United States person,
|
|
·
|
a controlled foreign corporation for United States tax purposes,
|
|
·
|
a foreign person 50% or more of whose gross income is effectively connected with the conduct of a United States trade or business for a specified three-year period, or
|
|
·
|
a foreign partnership, if at any time during its tax year:
|
|
·
|
one or more of its partners are "U.S. persons", as defined in U.S. Treasury regulations, who in the aggregate hold more than 50% of the income or capital interest in the partnership, or
|
|
·
|
such foreign partnership is engaged in the conduct of a United States trade or business,
|
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above are met or you otherwise establish an exemption. Backup withholding will apply if the sale is subject to information reporting and the broker has actual knowledge that you are a United States person.
You generally may obtain a refund of any amounts withheld under the backup withholding rules that exceed your income tax liability by timely filing a refund claim with the United States Internal Revenue Service.
United States Taxation of Shares and ADSs
This section is based in part upon the representations of the Depositary and the assumption that each obligation in the Deposit Agreement and any related agreement will be performed in accordance with its terms. In general, and taking into account this assumption, for United States federal income tax purposes, if you hold American Depositary Receipts, or ADRs, evidencing ADSs, you will be treated as the owner of the ordinary shares represented by those ADSs. Exchanges of ordinary shares for ADRs, and ADRs for ordinary shares, generally will not be subject to United States federal income tax.
Dividends
United States Holders. Under the United States federal income tax laws, and subject to the passive foreign investment company, or PFIC, rules discussed below, if you are a United States holder, the gross amount of any dividend paid by Statoil out of its current or accumulated earnings and profits (as determined for United States federal income tax purposes) is subject to United States federal income taxation. If you are a non-corporate United States holder, dividends that constitute qualified dividend income will be taxable to you at preferential rates applicable to long-term capital gains, provided that you hold the shares or ADSs for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date and meet certain other holding period requirements. Dividends we pay with respect to the shares or ADSs generally will be qualified dividend income.
You must include any Norwegian tax withheld from the dividend payment even though you do not in fact receive it. The dividend is taxable to you when you, in the case of shares, or the Depositary, in the case of ADSs, receive the dividend, actually or constructively. The dividend will not be eligible for the dividends-received deduction generally allowed to United States corporations in respect of dividends received from other United States corporations. The amount of the dividend distribution that you must include in your income as a United States holder will be the U.S. dollar value of the Norwegian kroner payments made, determined at the spot Norwegian kroner/U.S. dollar rate on the date the dividend distribution is includible in your income, regardless of whether the payment is in fact converted into U.S. dollars. Generally, any gain or loss resulting from currency exchange fluctuations during the period from the date you include the dividend payment in income to the date you convert the payment into U.S. dollars or other property will be treated as ordinary income or loss and will not be eligible for the special tax rate applicable to qualified dividend income. The gain or loss generally will be income or loss from sources within the United States for foreign tax credit limitation purposes. Distributions in excess of current and accumulated earnings and profits, as determined for United States federal income tax purposes, will be treated as a non-taxable return of capital to the extent of your basis in the shares or ADSs and thereafter as capital gain. However, we do not expect to calculate earnings and profits in accordance with United States federal income tax principles. Accordingly, you should expect to generally treat distributions we make as dividends.
Subject to certain limitations, Norwegian tax withheld in accordance with the Convention between the United States of America and the Kingdom of Norway for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Property (the "Treaty") and paid over to Norway will be creditable or deductible against your United States federal income tax liability. Special rules apply in determining the foreign tax credit limitation with respect to dividends that are subject to the preferential tax rates. To the extent a refund of the tax withheld is available to you under Norwegian law, the amount of tax withheld that is refundable will not be eligible for credit against your United States federal income tax liability.
For foreign tax credit purposes, dividends will be income from sources outside the United States and will, depending on your circumstances, be either "passive" or "general" income for purposes of computing the foreign tax credit allowable to you.
United States Alien Holders. If you are a United States alien holder, dividends paid to you in respect of shares or ADSs will not be subject to United States federal income tax unless the dividends are "effectively connected" with your conduct of a trade or business within the United States, and the dividends are attributable to a permanent establishment that you maintain in the United States if that is required by an applicable income tax treaty as a condition for subjecting you to United States taxation on a net income basis.
Capital Gains
United States Holders. Subject to the PFIC rules discussed below, if you are a United States holder and you sell or otherwise dispose of your shares or ADSs, you will recognize capital gain or loss for United States federal income tax purposes equal to the difference between the U.S. dollar value of the amount that you realize and your tax basis, determined in U.S. dollars, in your shares or ADSs. Capital gain of a non-corporate United States holder is generally taxed at preferential rates where the shares or ADSs are held for more than one year. The gain or loss will generally be income or loss from sources within the United States for foreign tax credit limitation purposes.
United States Alien Holders. If you are a United States alien holder, you will not be subject to United States federal income tax on gain recognized on the sale or other disposition of your shares or ADSs unless:
|
·
|
the gain is "effectively connected" with your conduct of a trade or business in the United States, and the gain is attributable to a permanent establishment that you maintain in the United States if that is required by an applicable income tax treaty as a condition for subjecting you to United States taxation on a net income basis, or
|
|
·
|
you are an individual, you are present in the United States for 183 or more days in the taxable year of the sale and certain other conditions exist.
|
PFIC Rules
We believe that shares and ADSs should not be treated as stock of a PFIC for United States federal income tax purposes, but this conclusion is a factual determination that is made annually and thus may be subject to change. If we were to be treated as a PFIC, unless a United States holder elects to be taxed annually on a mark-to-market basis with respect to the shares or ADSs, gain realized on the sale or other disposition of your shares or ADSs would in general not be treated as capital gain. Instead, if you are a United States holder, you would be treated as if you had realized such gain and certain "excess distributions" ratably over your holding period for the shares or ADSs and would be taxed at the highest tax rate in effect for each such year to which the gain was allocated, together with an interest charge in respect of the tax attributable to each such year. With certain exceptions, your shares or ADSs will be treated as stock in a PFIC if we were a PFIC at any time during your holding period in your shares or ADSs. Dividends that you receive from us will not be eligible for the preferential tax rates applicable to qualified dividend income if we are treated as a PFIC with respect to you either in the taxable year of the distribution or the preceding taxable year, but instead will be taxable at rates applicable to ordinary income.
Backup Withholding and Information Reporting
If you are a non-corporate United States holder, information reporting requirements, on Internal Revenue Service Form 1099, generally will apply to:
|
·
|
dividend payments or other taxable distributions made to you within the United States including payments made by wire transfer from outside the United States to an account you maintain in the United States, and
|
|
·
|
the payment of proceeds to you from the sale of shares or ADSs effected at a United States office of a broker.
|
Additionally, backup withholding will apply to such payments if you are a non-corporate United States holder that:
|
·
|
fails to provide an accurate taxpayer identification number,
|
|
·
|
is notified by the Internal Revenue Service that you have failed to report all interest and dividends required to be shown on your United States federal income tax returns, or
|
|
·
|
in certain circumstances, fails to comply with applicable certification requirements.
|
If you are a United States alien holder, you are generally exempt from backup withholding and information reporting requirements with respect to:
|
·
|
dividend payments made to you outside the United States by us or another non-United States payor, and
|
|
·
|
other dividend payments and the payment of the proceeds from the sale of shares or ADSs effected at a United States office of a broker, as long as the income associated with such payments is otherwise exempt from United States federal income tax and
|
|
·
|
the payor or broker does not have actual knowledge or reason to know that you are a United States person and you have furnished to the payor or broker:
|
|
·
|
an Internal Revenue Service Form W-8BEN or an acceptable substitute form upon which you certify, under penalties of perjury, that you are a non-United States person, or
|
|
·
|
other documentation upon which it may rely to treat the payments as made to a non-United States person in accordance with United States Treasury regulations, or
|
|
·
|
you otherwise establish an exemption.
|
Payment of the proceeds from the sale of shares or ADSs effected at a foreign office of a broker generally will not be subject to information reporting or backup withholding. However, a sale of shares or ADSs that is effected at a foreign office of a broker will be subject to information reporting and backup withholding if:
|
·
|
the proceeds are transferred to an account maintained by you in the United States,
|
|
·
|
the payment of proceeds or the confirmation of the sale is mailed to you at a United States address, or
|
|
·
|
the sale has some other specified connection with the United States as provided in United States Treasury regulations,
|
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above are met or you otherwise establish an exemption.
In addition, a sale of shares or ADSs effected at a foreign office of a broker will be subject to information reporting if the broker is:
|
·
|
a United States person,
|
|
·
|
a controlled foreign corporation for United States tax purposes,
|
|
·
|
a foreign person 50 percent or more of whose gross income is "effectively connected" with the conduct of a United States trade or business for a specified three-year period, or
|
|
·
|
a foreign partnership, if at any time during its tax year:
|
|
·
|
one or more of its partners are "U.S. persons", as defined in United States Treasury regulations, who in the aggregate hold more than 50 percent of the income or capital interest in the partnership, or
|
|
·
|
such foreign partnership is engaged in the conduct of a United States trade or business,
|
unless the broker does not have actual knowledge or reason to know that you are a United States person and the documentation requirements described above are met or you otherwise establish an exemption. Backup withholding will apply if the sale is subject to information reporting and the broker has actual knowledge that you are a United States person.
You generally may obtain a refund of any amounts withheld under the backup withholding rules that exceed your income tax liability by timely filing a refund claim with the United States Internal Revenue Service.
Norwegian Taxation of Debt Securities and Payments under the Guarantees
The following summary is based on current Norwegian law and practice, which is subject to changes that could prospectively or retrospectively modify or adversely affect the stated tax consequence. Prospective purchasers of securities should consult their own professional advisors as to their respective tax positions.
Under Norwegian law, payments of interest by Statoil ASA to a Norwegian resident for tax purposes under the debt securities may be subject to Norwegian tax, at a rate of 28%. Payments made by Statoil ASA under the debt securities to persons who are not Norwegian residents for tax purposes, referred to herein as non-residents, whether in respect of principal or interest on the debt securities, are not subject to any tax imposed by Norway or any political subdivision thereof or therein except for payments attributable to such person's branch, permanent establishment, or operation that may be subject to tax imposed by Norway or any political subdivision thereof or therein. In the event that any withholding is subsequently imposed with respect to any such payment as described in "Description of the Debt Securities and Guarantees—Additional Amounts" above, Statoil ASA will (subject to certain exceptions and limitations) pay such additional amounts under the debt securities as will result (after deduction of said withholding tax) in the payment of the amounts which would otherwise have been payable in respect of such debt securities had there been no such withholding tax. In addition, no income, capital gains, transfer or similar tax is currently imposed by Norway or any political subdivision thereof or therein on a sale, redemption or other disposition of debt securities, except for payments attributable to a non-resident's branch, permanent establishment, or operation that may be subject to tax imposed by Norway or any political subdivision thereof or therein.
Under Norwegian law, payments of interest by Statoil Petroleum to a Norwegian resident for tax purposes under the guarantee may be subject to Norwegian tax, at a rate of 28%. Payments by Statoil Petroleum under the guarantee to persons who are not Norwegian residents for tax purposes are not subject to any tax imposed by Norway or any political subdivision thereof or therein except for payments attributable to such person's branch, permanent establishment or operations in Norway that may be subject to tax imposed by Norway or any political subdivision thereof or therein.
Norwegian Taxation of Ordinary Shares and ADSs
Taxation of Dividends
Corporate shareholders resident in Norway for tax purposes are exempt from tax on dividends decided by the shareholders meeting of Norwegian companies except according to a recent change in the Norwegian exemption method, three percent of any such dividends will be taxable at a rate of 28 percent.
For individual shareholders resident in Norway for tax purposes, a classical system with partial double taxation was implemented as of January 1, 2006. Dividend income exceeding a "shield interest deduction", which is an amount equal to the risk-free interest after tax on the base cost of the shareholding, will be taxable at a flat rate, currently 28 percent. The average interest on Treasury bills of three months' maturity will be applied.
Non-resident shareholders are as a general rule subject to a withholding tax at a rate of 25 percent on dividends distributed by Norwegian companies. This withholding tax does not apply to corporate shareholders resident for tax purposes in European Economic Area (EEA) countries, provided that the corporate shareholder within the EEA area, have a "real establishment" in that country and the company must also take part in "genuine economic activity" here. Whether a company has a "real establishment" or takes part in "genuine economic activity" will depend on an overall evaluation.
If Norway according to a tax treaty or other treaties/conventions may request information from the state of establishment, the shareholders obligation would be to document that it is established in an EEA State and is actually carrying out an economic business activity in the EEA State. If no such tax treaty/convention exists, the shareholder must present a declaration from the tax authorities in the other EEA State which confirms that the documentation is correct.
The withholding tax rate of 25 percent is often reduced in tax treaties between Norway and the country in which the shareholder is resident. Generally, the treaty rate does not exceed 15 percent and in cases where a corporate shareholder holds a qualifying percentage of the shares of the distributing company, the withholding tax rate on dividends may be further reduced, even to zero percent under some tax treaties. The withholding tax rate in the tax treaty between the United States and Norway is currently 15 percent. However, the treaty is in the process of being renegotiated. The withholding tax does not apply to shareholders that carry on business activities in Norway and whose shares are effectively connected with such activities. In that case, the rules described in the paragraph above regarding corporate shareholders resident in Norway apply. We are obligated by law to deduct any applicable withholding tax when paying dividends to non-resident shareholders.
The 15 percent withholding rate under the tax treaty between Norway and the United States will apply to dividends paid on shares held directly by holders properly demonstrating to the company that they are entitled to the benefits of the tax treaty.
Dividends paid to the depositary for redistribution to shareholders holding ADSs will at the outset be subject to a withholding tax of 25 percent. The beneficial owners will in this case have to apply to the Central Office for Foreign Tax Affairs (COFTA) for refund of the excess amount of tax withheld. As yet, there is no standardized application form to obtain a refund of Norwegian withholding tax. An application must contain the following:
|
1.
|
a specification of the distributing company(ies) involved, the exact amount of shares, the date the dividend payments were made, the total dividend payment, the withholding tax drawn in Norway and what amount is being reclaimed. The withholding tax must be calculated in Norwegian currency and all sums specified accordingly (in NOK);
|
|
2.
|
documentation that shows that the refund claimant received the dividends and which withholding tax rate was used in Norway;
|
|
3.
|
a certificate of residence issued by the tax authorities stating that the refund claimant is resident for tax purposes in that state in the income year in question or at the time the dividends were decided. This documentation must be in original form;
|
|
4.
|
the information necessary to decide whether the refund claimant is an entity comprised by the tax exemption model;
|
|
5.
|
the information necessary to decide whether the refund claimant is the beneficial owner of the dividend payment(s); and
|
|
6.
|
if the securities are registered with a foreign custodian/bank/clearing central the claimant must submit information on which foreign custodian/bank/clearing central the securities are registered with in Norway.
|
The application must be signed by the applicant. If the application is signed by proxy, a copy of the letter of authorization must be enclosed.
However, pursuant to agreements with The Financial Supervisory Authority of Norway and the Norwegian Directorate of Taxes, The Bank of New York, acting as depositary, is entitled to receive dividends from us for redistribution to a beneficial owner of shares or ADSs at the applicable treaty withholding rate, provided the beneficial holder has furnished The Bank of New York with appropriate certification to establish such holder's eligibility for the benefits under an applicable tax treaty with Norway.
Wealth Tax. The shares are included when computing the wealth tax imposed on individuals who for tax purposes are considered resident in Norway. Norwegian joint stock companies and certain similar entities are not subject to wealth tax. Currently, the marginal wealth tax rate is 1.1 percent of the value assessed. The value for assessment purposes for shares listed on the Oslo Stock Exchange is the full listed value of such shares as of January 1 in the year of assessment.
Non-resident shareholders are not subject to wealth tax in Norway for shares in Norwegian joint stock companies unless the shareholder is an individual and the shareholding is effectively connected with his business activities in Norway.
Inheritance Tax and Gift Tax. When shares or ADSs are transferred, either through inheritance or as a gift, such transfer may give rise to inheritance tax in Norway if the deceased, at the time of death, or the donor, at the time of the gift, is a resident or citizen of Norway. If a Norwegian citizen at the time of death, however, is not a resident of Norway, Norwegian inheritance tax will not be levied if an inheritance tax or a similar tax is levied by the country of residence. Irrespective of citizenship, Norwegian inheritance tax may be levied if the shares or ADSs are effectively connected with the conduct of a trade or business through a permanent establishment in Norway.
Taxation upon Disposition of Shares
Corporate shareholders resident in Norway for tax purposes are exempt from tax on gains realized upon the disposition of shares in Norwegian companies.
Individual shareholders resident in Norway for tax purposes realize a taxable gain or loss upon a sale, redemption or other disposition of shares. Such capital gain or loss is included in or deducted upon computation of general income in the year of disposal. General income is taxed at a flat rate of 28 percent. The gain is subject to tax and the loss is deductible irrespective of the length of the ownership and the number of shares disposed of.
The taxable gain or loss is computed as the sales price adjusted for transactional expenses less the taxable basis. A shareholder's tax basis is normally equal to the acquisition cost of the shares. Any unused "shield interest deduction" from earlier years attributable to the individual shares realized may be deducted. Individual shareholders are subject to taxation on capital gains at the time the general tax liability to Norway ceases.
Non-resident shareholders are generally not subject to tax in Norway on capital gains, and losses are not deductible upon sale, redemption or other disposition of shares or ADSs in Norwegian companies, unless the shareholder is carrying on business activities in Norway and such shares or ADSs are effectively connected with such activities. In addition, exit tax rules apply if a resident shareholder ceases to be resident in Norway for tax purposes or if the shares otherwise loose their connection to the Norwegian taxation area, e.g. because a non-resident shareholder ceases its previous business activity in Norway and the shares were effectively connected with such activities. The tax liability is annulled if the gains from the disposition of shares are not realized within five years after the shareholder ceased to be a tax resident in Norway or alternatively within five years after the shares lost their connection to the Norwegian taxation area. Shareholders that are taking tax residency abroad or otherwise are terminating their share's connection to the Norwegian taxation area should consult their own legal or tax advisors regarding the exit tax rules impact on their Norwegian tax liability.
Transfer Tax. There is no transfer tax imposed in Norway in connection with the sale or purchase of shares.
European Union Savings Directive
Under EC Council Directive 2003/48/EC on the taxation of savings income (the "Directive"), Member States of the European Union ("Member States") are required to provide to the tax authorities of another Member State details of payments of interest or similar income paid by a person within its jurisdiction to an individual resident (or certain limited types of entity established) in that other Member State. However, for a transitional period, Austria and Luxembourg are instead required (unless during that period they elect otherwise) to operate a withholding system in relation to such payments (the ending of such transitional period being dependent upon the conclusion of certain other agreements relating to information exchange with certain other countries). A number of non-EU countries and territories including Switzerland have adopted similar measures (a withholding system in the case of Switzerland).
On 15 September 2008 the European Commission issued a report to the Council of the European Union on the operation of the Directive, which included the Commission's advice on the need for change to the Directive. On 13 November 2008 the European Commission published a more detailed proposal for amendments to the Directive, which included a number of suggested changes. The European Parliament approved an amended version of this proposal on 24 April 2009. If any of those proposed changes are made in relation to the Directive, they may amend or broaden the scope of the requirements described above.
If you reside in a Member State of the European Union, please consult your own legal or tax advisors regarding the consequences of the directive in your particular circumstances.
|
PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus:
|
·
|
directly to one or more purchasers.
|
The prospectus supplement relating to any offering will identify or describe:
|
·
|
any underwriter, dealers or agents;
|
|
·
|
the net proceeds to us;
|
|
·
|
the purchase price of the securities;
|
|
·
|
the initial public offering price of the securities; and
|
|
·
|
any exchange on which the securities will be listed.
|
Underwriters
If we use underwriters in the sale, we will enter into an underwriting agreement, and a prospectus supplement will set forth the names of the underwriters and the terms of the transaction. The underwriters will acquire securities for their own account and may resell the securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Unless we otherwise state in the prospectus supplement, various conditions to the underwriters' obligation to purchase securities apply, and the underwriters will be obligated to purchase all of the securities contemplated in an offering if they purchase any of such securities. Any initial public offering price and any discounts or concessions allowed or re-allowed or paid to dealers may be changed from time to time.
Statoil may enter into derivative or other hedging transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities covered by this prospectus including securities pledged by Statoil or borrowed from Statoil or others to settle those sales or to close out any related open borrowing of stock, and may use securities received from Statoil in settlement of those derivatives to close out any related open borrowings of stock. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or in a post-effective amendment). Statoil may also sell ordinary shares short using this prospectus and deliver ordinary shares covered by this prospectus to close out such short positions, or loan or pledge ordinary shares to financial institutions that in turn may sell the ordinary shares using this prospectus. Statoil may pledge or grant a security interest in some or all of the ordinary shares covered by this prospectus to support a derivative or hedging position or other obligation and, if Statoil defaults in the performance of its obligations, the pledgees or secured parties may offer and sell the ordinary shares from time to time pursuant to this prospectus.
One or more firms, referred to as "remarketing firms," may also offer or sell the securities, if the prospectus supplement so indicates, in connection with a remarketing arrangement upon their purchase. Remarketing firms will act as principals for their own accounts or as agents for us. These remarketing firms will offer or sell the securities in accordance with a redemption or repayment pursuant to the terms of the securities. The prospectus supplement will identify any remarketing firm and the terms of its agreement, if any, with us and will describe the remarketing firm's compensation.
If the prospectus supplement so indicates, we may authorize agents and underwriters or dealers to solicit offers by certain purchasers to purchase the securities from us at the public offering price set forth in the prospectus supplement. These contracts will be subject to only those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth the commission payable for solicitation of such offers.
Each series of debt securities offered will be a new issue of securities and will have no established trading market. The debt securities offered may or may not be listed on a national securities exchange. We cannot be sure as to the liquidity of or the existence of trading markets for any debt securities offered.
In connection with any offering, certain persons participating in the offering, such as the underwriters, if any, may purchase and sell securities in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by such persons of a greater number of securities than they are required to purchase in the offering. Stabilizing transactions consist of certain bids or purchases made for the purpose of preventing or retarding a decline in the market price of the securities while the offering is in progress.
The underwriters, if any, in any offering also may impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased securities sold by or for the account of such underwriter in stabilizing or short covering transactions.
These activities by such persons participating in the offering, as well as other purchases by such persons for their own accounts, may stabilize, maintain or otherwise affect the market prices of the securities. As a result, the prices of the securities may be higher than the prices that otherwise might exist in the open market. If these activities are commenced, they may be discontinued by such persons participating in the offering at any time. These transactions may be effected in the over-the-counter market or otherwise.
Dealers
If we use dealers in the sale, unless we otherwise indicate in the prospectus supplement, we will sell securities to the dealers as principals. The dealers may then resell the securities to the public at varying prices that the dealers may determine at the time of resale.
Agents and Direct Sales
We may sell securities directly or through agents that we designate. The prospectus supplement names any agent involved in the offering and sale and states any commissions we will pay to that agent. Unless we indicate otherwise in the prospectus supplement, any agent is acting on a best efforts basis for the period of its appointment.
Institutional Investors
If we indicate in the prospectus supplement, we will authorize underwriters, dealers or agents to solicit offers from various institutional investors to purchase securities. In this case, payment and delivery will be made on a future date that the prospectus supplement specifies. The underwriters, dealers or agents may impose limitations on the minimum amount that the institutional investor can purchase. They may also impose limitations on the portion of the aggregate amount of the securities that they may sell. These institutional investors include:
|
·
|
commercial and savings banks;
|
|
·
|
educational and charitable institutions; and
|
|
·
|
other similar institutions as we may approve.
|
The obligations of any of these purchasers pursuant to delayed delivery and payment arrangements will not be subject to any conditions. However, one exception applies. An institution's purchase of the particular securities can not at the time of delivery be prohibited under the laws of any jurisdiction that governs:
|
·
|
the validity of the arrangements; or
|
|
·
|
the performance by us or the institutional investor.
|
Indemnification
Agreements that we have entered into or may enter into with underwriters, dealers, agents or remarketing firms may entitle them to indemnification by us against various civil liabilities. These include liabilities under the Securities Act of 1933. The agreements may also entitle them to contribution for payments which they may be required to make as a result of these liabilities. Underwriters, dealers, agents or remarketing firms may be customers of, engage in transactions with, or perform services for us in the ordinary course of business.
Remarketing firms may be deemed to be underwriters in connection with the securities they remarket. Remarketing firms may be entitled under agreements that may be entered into with Statoil to indemnification by Statoil against certain civil liabilities, including liabilities under the Securities Act, and may be customers of, engage in transactions with or perform services for Statoil in the ordinary course of business.
Market Making
In the event that we do not list securities of any series on a U.S. national securities exchange, various broker-dealers may make a market in the securities, but will have no obligation to do so, and may discontinue any market making at any time without notice. Consequently, it may be the case that no broker-dealer will make a market in securities of any series or that the liquidity of the trading market for the securities will be limited.
VALIDITY OF SECURITIES
The validity of the debt securities and the guarantees will be passed upon for us by Sullivan & Cromwell LLP, our U.S. counsel, as to certain matters of New York law, and for any underwriters named in the applicable prospectus supplement by U.S. counsel to any such underwriters, as to certain matters of New York law. The validity of the debt securities, the ordinary share and the guarantees will be passed upon for us by our Senior Legal Counsel as to certain matters of Norwegian law, and for any underwriters by Norwegian counsel to any such underwriters. Sullivan & Cromwell LLP may rely upon the opinion of our Senior Legal Counsel with respect to all matters of Norwegian law.
EXPERTS
The consolidated financial statements of Statoil ASA as at December 31, 2012 and for the year then ended and management's assessment of the effectiveness of internal control over financial reporting as of December 31, 2012 appearing in Statoil ASA's Annual Report on Form 20-F for the year ended December 31, 2012, have been incorporated by reference herein in reliance upon the reports of KPMG AS, independent registered public accounting firm, incorporated by reference herein, and upon the authority of the said firm as experts in accounting and auditing. The audit report covering the December 31, 2012 financial statements refers to changes in the policy for classification in the balance sheet of short-term financial investments with less than three months to maturity and the policy for presentation of changes in current financial investments in the statement of cash flows.
The consolidated financial statements of Statoil ASA as at December 31, 2011 and as at December 31, 2010, and for the years ended December 31, 2011 and December 31, 2010, appearing in Statoil ASA's Annual Report on Form 20-F for the year ended December 31, 2012 have been audited by Ernst & Young AS, independent registered public accounting firm, as set forth in its report thereon, and incorporated herein by reference, given upon the authority of such firm as expert in accounting and auditing.
DeGolyer and MacNaughton, independent petroleum engineering consultants, performed an independent evaluation of proved reserves as of December 31, 2012 for our properties. DeGolyer and MacNaughton has delivered to us its summary letter report describing its procedures and conclusions, a copy of which appears as Exhibit 15(a)(iv) to our 2012 Annual Report on Form 20-F, which is incorporated herein by reference.
EXPENSES
The following is a statement of the expenses (all of which are estimated) to be incurred by us in connection with a distribution of securities registered under this registration statement:
Securities and Exchange Commission registration fee
|
|
|
|
(1) |
Printing and engraving expenses
|
|
$ |
15,000 |
|
Legal fees and expenses
|
|
$ |
125,000 |
|
Accounting fees and expenses
|
|
$ |
120,000 |
|
Indenture Trustee's fees and expenses
|
|
$ |
27,500 |
|
Rating Agencies' fees
|
|
$ |
1,680,000 |
|
Miscellaneous
|
|
$ |
50,000 |
|
Total
|
|
$ |
2,017,500 |
|
|
(1)
|
The registrants are registering an indeterminate amount of securities under the registration statement and in accordance with Rules 456(b) and 457(r), the registrants are deferring payment of any registration fee until the time the securities are sold under the registration statement pursuant to a prospectus supplement.
|