PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
and
WACHOVIA BANK, NATIONAL ASSOCIATION, as Trustee
INDENTURE
Dated as of December 17, 2002
Providing for the Issuance of
Debentures in Series
including
8.75% Deferrable Interest Junior Subordinated Debentures, Series D
Public Service Enterprise Group Incorporated Indenture
Certain Sections of this Indenture relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939
Trust Indenture Act Section
---------------------------
Indenture Section
-----------------
ss.310(a)(1) ........................................... 7.10
(a)(2) ........................................... 7.10
(a)(3) ........................................... Not Applicable
(a)(4) ........................................... Not Applicable
(a)(5) ........................................... Not Applicable
(b) ........................................... 7.08; 7.10; 11.01
(c) ........................................... Not Applicable
ss.311(a) ........................................... 7.11
(b) ........................................... 7.11
(c) ........................................... Not Applicable
ss.312(a) ........................................... 2.07
(b) ........................................... 11.03
(c) ........................................... 11.03
ss.313(a) ........................................... 7.06
(b)(1) ........................................... Not Applicable
(b)(2) ........................................... 7.06
(c) ........................................... 7.06; 11.02
(d) ........................................... 7.06
ss.314(a) ........................................... 4.03; 11.02
(b) ........................................... Not Applicable
(c)(1) ........................................... 2.02; 11.04; 11.05
(c)(2) ........................................... 2.02; 11.04; 11.05
(c)(3) ........................................... Not Applicable
(d) ........................................... Not Applicable
(e) ........................................... 11.05
(f) ........................................... Not Applicable
ss.315(a) ........................................... 7.01(b)
(b) ........................................... 7.05, 11.02
(c) ........................................... 7.01(a)
(d) ........................................... 7.01(c)
(e) ........................................... 6.11
ss.316(a)(1)(A) ........................................... 6.05
(a)(1)(B) ........................................... 6.04
(a)(2) ........................................... Not Applicable
(a)(last sentence)........................................... 2.10
(b) ........................................... 6.07
(c) ........................................... 1.05
ss.317(a)(1) ........................................... 6.08
(a)(2) ........................................... 6.09
(b) ........................................... 2.06
ss.318(a) ........................................... 11.01
(b) ........................................... Not Applicable
(c) ........................................... 11.01
----------
Note: This reconciliation and tie sheet shall not, for any purpose, be
deemed to be a part of the Indenture.
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TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 Definitions............................................................1
1.02 Other Definitions......................................................6
1.03 Incorporation by Reference of Trust Indenture Act......................6
1.04 Rules of Construction..................................................6
1.05 Acts of Holders and Holders of Preferred Securities....................7
ARTICLE 2
THE DEBENTURES; THE SERIES D DEBENTURES
2.01 Issue of Debentures Generally..........................................8
2.02 Terms and Form of the Series D Debentures..............................9
2.03 Payment of Principal and Interest.....................................10
2.04 Execution, Authentication and Delivery................................12
2.05 Registrar and Paying Agent............................................13
2.06 Paying Agent to Hold Money in Trust...................................14
2.07 Debentureholder Lists.................................................15
2.08 Transfer and Exchange.................................................15
2.09 Replacement Debentures................................................15
2.10 Outstanding Debentures; Determinations of Holders' Action.............16
2.11 Temporary Debentures..................................................17
2.12 Book-Entry System.....................................................17
2.13 Cancellation..........................................................18
ARTICLE 3
REDEMPTION
3.01 Redemption: Notice to Trustee.........................................19
3.02 Selection of Debentures to be Redeemed................................19
3.03 Notice of Redemption..................................................19
3.04 Effect of Notice of Redemption........................................20
3.05 Deposit of Redemption Price...........................................20
3.06 Debentures Redeemed in Part...........................................21
ARTICLE 4
COVENANTS
4.01 Payment of Debentures.................................................21
4.02 Prohibition Against Dividends. etc....................................22
4.03 SEC Reports...........................................................22
4.04 Compliance Certificates...............................................22
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4.05 Further Instruments and Acts..........................................23
4.06 Payments for Consents.................................................23
4.07 Payment of Expenses of Trusts.........................................23
ARTICLE 5
SUCCESSOR CORPORATION
5.01 When the Company May Merge, Etc.......................................23
ARTICLE 6
DEFAULTS AND REMEDIES
6.01 Events of Default.....................................................24
6.02 Acceleration..........................................................25
6.03 Other Remedies........................................................26
6.04 Waiver of Past Defaults...............................................26
6.05 Control by Majority...................................................27
6.06 Limitation on Suits...................................................27
6.07 Rights of Holders to Receive Payment..................................28
6.08 Collection Suit by the Trustee........................................28
6.09 The Trustee May File Proofs of Claim..................................28
6.10 Priorities............................................................29
6.11 Undertaking for Costs.................................................29
6.12 Waiver of Stay; Extension or Usury Laws...............................29
ARTICLE 7
THE TRUSTEE
7.01 Duties of the Trustee.................................................30
7.02 Rights of the Trustee.................................................31
7.03 Individual Rights of the Trustee......................................32
7.04 The Trustee's Disclaimer..............................................32
7.05 Notice of Defaults....................................................32
7.06 Reports by Trustee to Holders.........................................33
7.07 Compensation and Indemnity............................................33
7.08 Replacement of Trustee................................................34
7.09 Successor Trustee by Merger...........................................34
7.10 Eligibility: Disqualification.........................................35
7.11 Preferential Collection of Claims Against the Company.................35
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE;
DEFEASANCE OF CERTAIN OBLIGATIONS; UNCLAIMED MONEYS
8.01 Satisfaction and Discharge of Indenture...............................35
8.02 Application by Trustee of Funds Deposited for Payment of Debentures...36
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8.03 Repayment of Moneys Held by Paying Agent..............................36
8.04 Return of Moneys Held by the Trustee and Paying Agent Unclaimed for
Three Years......................................................37
ARTICLE 9
AMENDMENTS
9.01 Without Consent of Holders............................................37
9.02 With Consent of Holders...............................................38
9.03 Compliance with Trust Indenture Act...................................39
9.04 Revocation and Effect of Consents; Xxxxxxx and Actions................39
9.05 Notation on or Exchange of Debentures.................................39
9.06 Trustee to Execute Supplemental Indentures............................40
9.07 Effect of Supplemental Indentures.....................................40
ARTICLE 10
SUBORDINATION
10.01 Applicability of Article; Debentures Subordinated to Senior
Indebtedness..........................................................40
10.02 Priority and Payment of Proceeds in Certain Events:
Remedies Standstill...................................................40
10.03 Payments which May Be Made Prior to Notice............................41
10.04 Rights of Holders of Senior Indebtedness Not to Be Impaired...........42
10.05 Trustee May Take Action to Effectuate Subordination...................42
10.06 Subrogation...........................................................42
10.07 Obligations of Company Unconditional: Reinstatement...................43
10.08 Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice.....................................................43
10.09 Right of Trustee to Hold Senior Indebtedness..........................44
ARTICLE 11
MISCELLANEOUS
11.01 Trust Indenture Act Controls..........................................44
11.02 Notices...............................................................44
11.03 Communication by Holders with Other Holders...........................45
11.04 Certificate and Opinion as to Conditions Precedent....................45
11.05 Statements Required in Certificate or Opinion.........................46
11.06 Severability Clause...................................................46
11.07 Rules by Trustee, Paying Agent and Registrar..........................46
11.08 Legal Holidays........................................................46
11.09 Governing Law.........................................................47
11.10 No Recourse Against Others............................................47
11.11 Successors............................................................47
11.12 Multiple Original Copies of this Indenture............................47
11.13 No Adverse Interpretation of Other Agreements.........................47
11.14 Table of Contents: Headings. Etc......................................47
iv
11.15 Benefits of the Indenture.............................................47
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INDENTURE, dated as of December 17, 2002, by and between Public Service
Enterprise Group Incorporated, a corporation duly organized and existing under
the laws of the State of New Jersey (the "Company"), and Wachovia Bank, National
Association, a national banking association duly organized and existing under
the laws of the United States of America, as trustee (the "Trustee").
WHEREAS, the Company may from time to time create or establish one or more
statutory trusts for the purpose of issuing undivided beneficial interests in
the assets thereof (the "Trust Securities") and using the proceeds thereof to
acquire the Company's Debentures.
WHEREAS, pursuant to an Amended and Restated Trust Agreement dated as of
December 17, 2002 (the "Trust II Agreement") among the Company, as depositor,
Wachovia Bank, National Association, as Property Trustee, the Delaware Trustee
named therein and the Administrative Trustee named therein, there has been
declared and established PSEG Funding Trust II, a Delaware statutory trust
("Trust II").
WHEREAS, Trust II intends to issue its Trust Securities, including its
8.75% Preferred Securities, representing undivided beneficial interests in the
assets of Trust II, having a liquidation amount of $25 per security and having
terms provided therefor in the Trust II Agreement.
WHEREAS, the Company has authorized the issuance of its 8.75% Deferrable
Interest Junior Subordinated Debentures, Series D (the "Series D Debentures") to
be purchased by Trust II with the proceeds from the issuance and sale of its
Trust Securities, and to provide therefor, the Company has duly authorized the
execution and delivery of this Indenture.
WHEREAS, all things necessary to make the securities issued hereunder,
when xxxx issued and executed by the Company and authenticated and delivered
hereunder, the valid obligations of the Company, and to make this Indenture a
valid and binding agreement of the Company, enforceable in accordance with its
terms, have been done.
NOW THEREFORE:
Each of the Company and the Trustee, intending to be legally bound hereby,
agrees as follows for the benefit of the other party and for the equal and
ratable benefit of the Holders (as hereinafter defined) of the securities issued
hereunder, including the Series D Debentures:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 Definitions.
"Affiliate" of any specified Person means any other Person, directly or
indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. When used with respect to any Person,
"control" means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership
1
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board.
"Board Resolution" means (i) a copy of a resolution certified by the
Secretary or the Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification and delivered to the Trustee or (ii) a certificate signed by the
authorized officer or officers to whom the Board of Directors has delegated its
authority, and in each case, delivered to the Trustee.
"Business Day" means any day that is not a Saturday, a Sunday or a day on
which banking institutions in The City of New York or the State of New Jersey
are authorized or required by law or executive order to close.
"Capital Stock" means any and all shares, interests, rights to purchase,
warrants, options, participation or other equivalents of or interests in
(however designated) corporate stock, including limited liability company
membership interests.
"Common Securities" means the Common Trust Securities of a Trust,
representing undivided beneficial interests in the assets of such Trust.
"Company" means Public Service Enterprise Group Incorporated, a New Jersey
corporation, or any permitted successor thereto.
"Company Order" means a written request or order signed in the name of the
Company by an Officer of the Company and delivered to the Trustee.
"Debentureholder" or "Holder" means a Person in whose name a Debenture is
registered on the Registrar's books.
"Debentures" means any of the securities of any series issued,
authenticated and delivered under this Indenture.
"Default" means any event which is, or after notice or passage of time, or
both, would be, an Event of Default pursuant to Section 6.01 hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Extension Period", with respect to any series of Debentures, means the
period during which the Company may elect to extend the interest payment period
on such series of the Debentures pursuant to Section 4.01(b) hereof; provided
that no Extension Period shall extend beyond the Stated Maturity Date or the
Redemption Date of any Debenture of such series.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified
2
Public Accountants and statements and pronouncements of the Financial Accounting
Standards Board.
"Guarantee Agreement" means a Guarantee Agreement, dated as of the date
any Debentures are issued, from the Company, as guarantor, to Wachovia Bank,
National Association, as guarantee trustee, with respect to the Preferred
Securities issued on the date of such Guarantee Agreement.
"Indenture" means this indenture, as amended or supplemented from time to
time in accordance with the terms hereof, including the provisions of the TIA
that are deemed to be a part hereof.
"Interest Payment Date", when used with respect to the Debentures of any
series, means the stated maturity of any installment of interest on the
Debentures of that series.
"Issue Date", with respect to a series of Debentures, means the date on
which the Debentures of such series are originally issued.
"Officer" means, with respect to any corporation, the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of
such corporation.
"Officer's Certificate" means a written certificate containing the
applicable information specified in Sections 11.04 and 11.05 hereof, signed in
the name of the Company by any one of its Officers, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion containing the applicable
information specified in Sections 11.04 and 11.05 hereof, by legal counsel who
is reasonably acceptable to the Trustee.
"Paying Agent" means any Person authorized by the Company to pay the
principal of and premium, if any, and interest on the Debentures of any series
on behalf of the Company.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
"Predecessor Debentures" of any particular Debenture means every previous
Debenture evidencing all or a portion of the same debt as that evidenced by such
particular Debenture; and for purposes of this definition, any Debenture
authenticated and delivered under Section 2.09 hereof in exchange for or in lieu
of a mutilated, destroyed, lost or stolen Debenture shall be deemed to evidence
the same debt as the mutilated, destroyed, lost or stolen Debenture.
"Preferred Securities" means the Trust Preferred Securities of a Trust,
representing undivided beneficial interests in the assets of such Trust.
3
"Property Trustee" means the entity named as property trustee under a
Trust Agreement and its successors and assigns under such Trust Agreement.
"Record Date", with respect to any series of the Debentures, means the
Regular Record Date, the Special Record Date or any date set to determine the
Holders of Debentures of such series entitled to vote, consent, make a request
or exercise any other right associated with such Debentures.
"Redemption Date", with respect to the Debentures of any series to be
redeemed, means the date specified for the redemption thereof in accordance with
the terms thereof and pursuant to Article 3 of this Indenture.
"Redemption Price", with respect to the Debentures of any series to be
redeemed, means the price at which such Debenture is to be redeemed in
accordance with the terms thereof and pursuant to Article 3 of this Indenture.
"Regular Record Date", with respect to an interest payment on the
Debentures of a series, means the date set forth in this Indenture or the
supplemental indenture creating such series for the determination of Holders
entitled to receive payment of interest on the next succeeding Interest Payment
Date.
"Responsible Officer", when used with respect to the Trustee, means any
Vice President, any Assistant Vice President, any Trust Officer, or Assistant
Trust Officer or any other officer of the Corporate Trust Department of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"SEC" or "Commission" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, amended.
"Senior Indebtedness" means the principal of and premium, if any, and
unpaid interest on (i) indebtedness of the Company (including indebtedness of
others guaranteed by the Company and any Debentures to which the provisions of
Article 10 hereof are not applicable), whether outstanding on the date hereof or
hereafter created, incurred, assumed or guaranteed, for money borrowed, unless
in the instrument creating or evidencing the same or pursuant to which the same
is outstanding it is provided that such indebtedness is not senior or prior in
right of payment to the Debentures, and (ii) renewals, extensions, modifications
and refundings of any such indebtedness. Nothwithstanding the foregoing, the
term Senior Indebtedness shall not include any series of Deferrable Interest
Subordinated Debentures issued under the Indenture dated as of January 1, 1998
between the Company and Wachovia Bank, National Association (formerly known as
First Union National Bank).
"Series D Debentures" means any of the Company's 8.75% Deferrable Interest
Junior Subordinated Debentures, Series D issued under this Indenture.
4
"Special Record Date" for the payment of any Defaulted Interest on the
Debentures of any series means the date determined pursuant to Section 2.03
hereof.
"Stated Maturity Date", with respect to any Debenture, means the date
specified for such Debenture as the fixed date on which the principal of such
Debenture is due and payable.
"Subsidiary" means any corporation, association, partnership, trust or
other business entity of which more than 50% of the total voting power of shares
of Capital Stock or other interests (including partnership interests) entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by (i) the Company, (ii) the Company and one or more
Subsidiaries, or (iii) one or more Subsidiaries.
"TIA" means the Trust Indenture Act of 1939, as amended and as in effect
on the date of this Indenture; provided, however, that if the TIA is amended
after such date, TIA means, to the extent required by any such amendment, the
TIA as so amended.
"Trust" means any statutory trust created by the Company to issue Trust
Securities and to use the proceeds from the sale thereof to purchase Debentures.
"Trust Agreement" means an Amended and Restated Trust Agreement dated as
of the date any Debentures are issued among the Company, as Depositor, and the
Property Trustee and the other trustees named therein.
"Trust II" means PSEG Funding Trust II, a Delaware statutory trust created
under the Delaware Business Trust Act, Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss. 3801, et seq.
"Trust II Agreement" means the Amended and Restated Trust Agreement dated
as of December 17, 2002, among the Company, as Depositor, Wachovia Bank,
National Association (formerly known as First Union National Bank), as Property
Trustee, the Delaware Trustee named therein and the Administrative Trustee named
therein, as the same may be amended and modified from time to time.
"Trust Securities" means the undivided beneficial interests in the assets
of a Trust and includes the Preferred Securities and the Common Securities of
such Trust.
"Trustee" means Wachovia Bank, National Association, until a successor
replaces it pursuant to the applicable provisions of this Indenture and,
thereafter, shall mean such successor.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
5
"Wholly Owned Subsidiary" means a Subsidiary all the Capital Stock of
which (other than directors' qualifying shares) is owned by the Company or
another Wholly Owned Subsidiary.
1.02 Other Definitions.
TERM DEFINED IN SECTION
---- ------------------
"Act" ................................................... 1.05
"Bankruptcy Law" ........................................ 6.01
"Custodian" ............................................. 6.01
"Defaulted Interest" .................................... 2.03
"Depositary" ............................................ 2.12
"global Debenture" ...................................... 2.12
"Legal Holiday" ......................................... 11.08
"Notice of Default" ..................................... 6.01
"Register" .............................................. 2.05
"Registrar" ............................................. 2.05
"Successor" ............................................. 5.01
1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, such provision
is incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Debentures.
"indenture security holder" means a Debentureholder or Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any
other obligor on the Debentures.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
1.04 Rules of Construction.
Unless the context otherwise requires:
(1) Each capitalized term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
6
(3) "or" is not exclusive;
(4) "including" means including, without limitation;
(5) words in the singular include the plural, and words in the plural
include the singular; and
(6) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
1.05 Acts of Holders and Holders of Preferred Securities.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders or by
holders of Preferred Securities may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders or holders of
Preferred Securities, as applicable, in person or by an agent duly appointed in
writing and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of Holders or holders of
Preferred Securities signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Trustee deems
sufficient.
(c) The ownership of Debentures shall be proved by the Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Debenture shall bind every future Holder of
the same Debenture and the Holder of every Debenture issued upon the
registration transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Debenture.
(e) If the Company solicits from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a resolution of its Board of Directors, fix in
advance a Record Date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. If such a Record Date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act may be given before or after such Record Date, but only Holders of
record at the close of business on such Record Date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of outstanding Debentures have authorized or agreed
7
or consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the outstanding Debentures shall be
computed as of such Record Date.
ARTICLE 2
THE DEBENTURES; THE SERIES D DEBENTURES
2.01 Issue of Debentures Generally.
The aggregate principal amount of any series of Debentures which may be
authenticated and delivered under this Indenture is limited to the aggregate
liquidation amount of the Trust Securities of the Trust purchasing such
Debentures.
The Debentures may be issued in one or more series as from time to time
shall be authorized by the Board of Directors.
The Debentures of each series and the Trustee's Certificate of
Authentication shall be substantially in the forms to be attached as exhibits to
the Indenture or supplemental indenture creating such series, but in the case of
any series of Debentures other than the Series D Debentures, with such
inclusions, omissions and variations as to letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Indenture, or as may be required to
comply with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any securities exchange on which such Debentures may
be listed, or to conform to usage.
Other series of Debentures may differ from the Series D Debentures, and as
and between series, in respect of any or all of the following matters:
(a) designation;
(b) Stated Maturity Date or Dates, which may be serial and the Company's
option, if any, to change the Stated Maturity Date or Dates;
(c) interest rate or method of determination of the interest rate;
(d) the basis upon which interest shall be computed if other than a
360-day year composed of twelve 30-day months;
(e) Interest Payment Dates and the Regular Record Dates therefor;
(f) the maximum duration of the Extension Period;
(g) Issue Date or Dates and interest accrual provisions;
(h) authorized denominations;
(i) the place or places for the payment of principal (and premium, if any)
and interest;
8
(j) the aggregate principal amount of Debentures of such series which may
be issued;
(k) the optional and mandatory redemption provisions, if any;
(l) provisions, if any, for any sinking or analogous fund;
(m) the applicability to such series of the provisions of Article 10
hereof relating to subordination; and
(n) any other provisions expressing or referring to the terms and
conditions upon which the Debentures of such series are to be issued under this
Indenture which are not in conflict with the provisions of this Indenture;
in each case as determined by the Board of Directors and specified in the
supplemental indenture creating such series.
2.02 Terms and Form of the Series D Debentures.
(a) The Series D Debentures shall be designated "Public Service Enterprise
Group Incorporated, 8.75% Deferrable Interest Junior Subordinated Debentures,
Series D." The Series D Debentures and the Trustee's Certificate of
Authentication shall be substantially in the form of Exhibit A attached hereto.
Any Series D Debentures to be issued as global Debentures shall be issued as
global Debentures in accordance with the provisions of Section 2.12 of this
Indenture, with The Depository Trust Company as Depositary. The terms and
provisions contained in the Series D Debentures shall constitute, and are hereby
expressly made, a part of this Indenture. The Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
(b) The aggregate principal amount of Series D Debentures outstanding at
any time may not exceed $185,567,025 except as provided in Section 2.09 hereof.
The Series D Debentures shall be authenticated and delivered upon delivery to
the Trustee of items specified in Section 2.04(d) hereof.
(c) The Stated Maturity Date of the Series D Debentures is December 31,
2032.
(d) The interest rate of the Series D Debentures shall be as follows:
8.75% per annum. The Interest Payment Dates for the Series D Debentures shall be
March 31, June 30, September 30 and December 31 of each year, commencing March
31, 2003. In the event that any date on which interest is payable on the Series
D Debentures is not a Business Day, then payment of interest payable on such
date will be made on the next day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that if such
Business Day is in the next succeeding calendar year, such payment shall be made
on the immediately preceding Business Day, in each case with the same force and
effect as if made on such date. The Regular Record Date for each Interest
Payment Date for the Series D Debentures shall be the 15th day (whether or not a
Business Day) preceding the applicable Interest Payment
9
Date, provided that if Trust II is the sole Holder of the Series D Debentures or
the Series D Debentures are issued in book-entry-only form, the Regular Record
Date shall be the close of business on the Business Day immediately preceding
such Interest Payment Date.
Each Series D Debenture shall bear interest from its Issue Date or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for with respect to such Series D Debenture; except that, so long as
there is no existing Defaulted Interest (as defined in Section 2.03 hereof) or
Extension Period on the Series D Debentures, any Series D Debenture
authenticated by the Trustee between the Regular Record Date for any Interest
Payment Date and such Interest Payment Date shall bear interest from such
Interest Payment Date.
Overdue principal of and interest on any Series D Debenture and interest
which has been deferred pursuant to Section 4.01(b) hereof shall bear interest
(to the extent that the payment of such interest shall be legally enforceable)
at a rate per annum equal to the interest rate per annum payable on such Series
D Debenture.
(e) The Series D Debentures shall be issuable only in registered form
without coupons and only in denominations of $25 and any integral multiple
thereof.
(f) The maximum Extension Period for the Series D Debentures shall be five
years consisting of 20 consecutive quarterly interest periods.
2.03 Payment of Principal and Interest.
Unless otherwise specified pursuant to Section 2.01(d), interest on the
Debentures shall be computed on the basis of a 360-day year composed of twelve
30-day months.
Unless otherwise provided with respect to a series of Debentures,
(i) the principal and Redemption Price of and interest on each
Debenture shall be payable in such coin or currency of the
United States of America as at the time of payment is legal
tender for the payment of public and private debts;
(ii) the principal and Redemption Price of any Debenture and
interest payable on the Stated Maturity Date (if other than an
Interest Payment Date) or Redemption Date shall be payable in
immediately available funds upon surrender of such Debenture
at the office or agency of any Paying Agent therefor; and
(iii) interest on any Debenture shall be paid on each Interest
Payment Date therefor to the Holder thereof at the close of
business on the Record Date therefor, such interest to be
payable by check mailed to the address of the Person entitled
thereto as such address appears on the Register; provided
however, that (1) at the written request of the Holder of at
least $10,000,000 aggregate principal amount of Debentures
received by the
10
Registrar not later than the Regular Record Date for such
Interest Payment Date, interest accrued on such Debenture will
be payable by wire transfer within the continental United
States in immediately available funds to the bank account
number of such Holder specified in such request and entered on
the Register by the Registrar and (2) payments made in respect
of global Debentures shall be made in immediately available
funds to the Depositary.
Except as specified pursuant to Section 2.01 or Section 4.01(b) hereof,
interest on any Debenture which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Debenture (or one or more Predecessor Debentures) is registered at the
close of business on the Regular Record Date for such interest. Any interest on
any Debenture which is payable, but is not punctually paid or duly provided for,
on any Interest Payment Date (herein called "Defaulted Interest") shall
forthwith cease to be payable to the Holder on the relevant Regular Record Date
by virtue of having been such Holder, and such Defaulted Interest may be paid by
the Company, at its election in each case, as provided in Clause (1) and (2)
below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Debentures (or their respective Predecessor
Debentures) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall, not less than 15 Business Days
prior to the date of the proposed payment, notify the Trustee and the
Paying Agent in writing of the amount of Defaulted Interest proposed to be
paid on each Debenture and the date of the proposed payment, and at the
same time the Company shall deposit with the Paying Agent an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Paying
Agent for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this Clause provided. The
Special Record Date for the payment of such Defaulted Interest shall be
the close of business on the tenth calendar day prior to the date of the
proposed payment. The Trustee shall, in the name and at the expense of the
Company, cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be given to the Holders thereof,
not less than 7 calendar days prior to such Special Record Date. Notice of
the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been given, such Defaulted Interest shall be paid to
the Persons in whose names the Debentures (or their respective Predecessor
Debentures) are registered at the close of business on such Special Record
Date and shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on the
Debentures in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Debentures may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee
11
and the Paying Agent of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Paying Agent.
Subject to the foregoing provisions of this Section, each Debenture
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Debenture shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Debenture.
2.04 Execution, Authentication and Delivery.
(a) The Debentures shall be executed on behalf of the Company by its
Chairman, its President or one of its Vice Presidents, under its corporate seal
imprinted or reproduced thereon and attested by its Secretary or one of its
Assistant Secretaries. The signature of any such Officer on the Debentures may
be manual or facsimile.
(b) Debentures bearing the manual or facsimile signatures of individuals
who were at any time the proper Officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Debentures or did not
hold such offices at the date of such Debentures.
(c) No Debenture shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Debenture a
Certificate of Authentication duly executed by the Trustee by manual signature
of a Responsible Officer, and such Certificate of Authentication upon any
Debenture shall be conclusive evidence, and the only evidence, that such
Debenture has been duly authenticated and made available for delivery hereunder.
(d) The Trustee shall authenticate and deliver Debentures of a series, for
original issue, at one time or from time to time in accordance with the Company
Order referred to below, upon receipt by the Trustee of:
(1) a Board Resolution approving the form or forms and terms of such
Debentures;
(2) a Company Order requesting the authentication and delivery of such
Debentures and stating the identity of the Trust and the aggregate
liquidation amount of the Trust Securities to be issued concurrently with
such Debentures;
(3) unless previously delivered, this Indenture or a supplemental
indenture hereto setting forth the form of such Debentures and
establishing the terms thereof;
(4) the Debentures of such series, executed on behalf of the Company in
accordance with Section 2.04(a) hereof;
(5) an Opinion of Counsel to the effect that:
12
(i) the form or forms of such Debentures have been duly authorized by the
Company and have been established in conformity with the provisions of
this Indenture; and
(ii) such Debentures, when authenticated and delivered by the Trustee and
issued and delivered by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will have been duly
issued under this Indenture and will constitute valid and legally binding
obligations of the Company, entitled to the benefits provided by this
Indenture, and enforceable in accordance with their terms, subject, as to
enforcement to laws relating to or affecting generally the enforcement of
creditors' rights, including, without limitation, bankruptcy and
insolvency laws and to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law);
and
(iii) that this Indenture or any supplemental indenture referred to in
clause (3) above has been duly authorized, executed and delivered by the
Company and is a valid instrument legally binding upon the Company,
enforceable in accordance with its terms, subject as to enforcement to
laws relating to or affecting creditors' rights, including, without
limitation, bankruptcy and insolvency laws and to general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law); and
(iv) that all consents, approvals and orders of any commission,
governmental authority or agency required in connection with the issuance
and delivery of such Debentures have been obtained.
(e) an Officer's Certificate certifying that no Default or Event of
Default has occurred and is continuing.
(f) The Trustee shall act as the initial authenticating agent. Thereafter,
the Trustee may appoint an authenticating agent. An authenticating agent may
authenticate Debentures whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent. The Trustee shall pay any authenticating agent appointed by the Trustee
reasonable compensation for its services and the Trustee shall be reimbursed for
such payment by the Company pursuant to Section 7.07 hereof. The provisions set
forth in Section 7.02, Section 7.03, Section 7.04 and Section 7.07 hereof shall
be applicable to any authenticating agent.
2.05 Registrar and Paying Agent.
The Company shall maintain or cause to be maintained, within or outside
the State of New Jersey, an office or agency where the Debentures may be
presented for registration of transfer or for exchange ("Registrar"), a Paying
Agent at whose office the Debentures may be presented or surrendered for
payment, and an office or agency where notices and demands to or upon the
Company in respect of the Debentures and this Indenture may be served. The
Registrar shall keep a register (the "Register") of the Debentures and of their
transfer and exchange. The
13
Company may have one or more co-Registrars and one or more additional Paying
Agents. The term Registrar includes any additional registrar and the term Paying
Agent includes any additional paying agent. The corporate office of the Trustee
in Morristown, New Jersey, shall initially be the Registrar for each series of
Debentures and agent for service of notice or demands on the Company, and the
Trustee shall initially be the Paying Agent for each series of Debentures.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-Registrar (if not the Company or the Trustee or an
affiliate of the Trustee). The agreement shall implement the provisions of this
Indenture that relate to such agent. The Company shall give prompt written
notice to the Trustee and to the Holders of any change of location of such
office or agency. If at any time the Company shall fail to maintain or cause to
be maintained any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the address of the Trustee set forth in Section
11.02 hereof. The Company shall notify the Trustee of the name and address of
any such agent. If the Company fails to maintain a Registrar, Paying Agent or
agent for service of notices or demands, the Trustee shall act as such and shall
be entitled to appropriate compensation therefor pursuant to Section 7.07
hereof. The Company or any Affiliate of the Company may act Paying Agent,
Registrar or co-Registrar or agent for service of notices and demands.
The Company may also from time to time designate one or more other offices
or agencies where the Debentures may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations. The Company
will give prompt written notice to the Trustee and to the Holders of any such
designation or rescission and of any change in location of any such other office
or agency.
2.06 Paying Agent to Hold Money in Trust.
Except as otherwise provided herein, prior to 10:00 a.m. on each due date
of the principal of and premium (if any) and interest on any Debenture, the
Company shall deposit with the Paying Agent a sum of money sufficient to pay
such principal, premium (if any) and interest so becoming due. The Company shall
require each Paying Agent (other than the Trustee or the Company) to agree in
writing that such Paying Agent shall hold in trust for the benefit of Holders or
the Trustee all money held by the Paying Agent for the payment of principal of
and premium (if any) and interest on the Debentures and shall notify the Trustee
of any Default by the Company in making any such payment. At any time during the
continuance of any such Default, the Paying Agent shall, upon the request of the
Trustee, forthwith pay to the Trustee all money so held in trust and account for
any money disbursed by it. The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee and to account for any money disbursed
by it. Upon doing so, the Paying Agent shall have no further liability for the
money so paid over to the Trustee. If the Company, a Subsidiary or an Affiliate
of either of them acts as Paying Agent, it shall segregate the money held by it
as Paying Agent and hold it as a separate trust fund.
14
2.07 Debentureholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Debentureholders. If the Trustee is not the Registrar, the Company shall cause
to be furnished to the Trustee on or before the Record Date for each Interest
Payment Date and at such other times as the Trustee may request in writing,
within five Business Days of such request, a list, in such form as the Trustee
may reasonably require of the names and addresses of Debentureholders.
2.08 Transfer and Exchange.
When Debentures are presented to the Registrar or a co-Registrar with a
request to register the transfer or to exchange them for an equal principal
amount of Debentures of the same series of other authorized denominations, the
Registrar shall register the transfer or make the exchange as requested if its
reasonable requirements for such transactions are met. To permit registrations
of transfer and exchanges, the Company shall execute and the Trustee shall
authenticate Debentures, all at the Registrar's request.
Every Debenture presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Registrar) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Registrar duly executed by the Holder or his attorney duly
authorized in writing.
The Company shall not require payment of a service charge for any
registration of transfer or exchange of Debentures, but the Company may require
payment of a sum sufficient to pay all taxes, assessments or other governmental
charges that may be imposed in connection with the registration of the transfer
or exchange of Debentures from the Debentureholder requesting such transfer or
exchange (other than any exchange of a temporary Debenture for a definitive
Debenture not involving any change in ownership).
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of (a) any Debenture for a period beginning at
the opening of business 15 days before the mailing of a notice of redemption of
Debentures and ending at the close of business on the day of such mailing or (b)
any Debenture selected, called or being called for redemption, except, in the
case of any Debenture to be redeemed in part, the portion thereof not to be
redeemed.
2.09 Replacement Debentures.
If (a) any mutilated Debenture is surrendered to the Company or the
Trustee, or (b) the Company and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Debenture, and there is
delivered to the Company and the Trustee such security or indemnity as may be
required by them to save each of them harmless, then, in the absence of notice
to the Company or the Trustee that such Debenture has been acquired by a bona
fide purchaser, the Company shall execute in exchange for any such mutilated
Debenture or in lieu of any such destroyed, lost or stolen Debenture, a new
Debenture of the same series and of like
15
tenor and principal amount, bearing a number not contemporaneously outstanding,
and the Trustee shall authenticate and make such new Debenture available for
delivery.
In case any such mutilated, destroyed, lost or stolen Debenture has become
or is about to become due and payable, or is about to be redeemed by the Company
pursuant to Article 3 hereof, the Company in its discretion may, instead of
issuing a new Debenture, pay or purchase such Debenture, as the case may be.
Upon the issuance of any new Debentures under this Section 2.09, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) in connection
therewith.
Every new Debenture issued pursuant to this Section 2.09 in lieu of any
mutilated, destroyed, lost or stolen Debenture shall constitute an original
additional contractual obligation of the Company (whether or not the mutilated,
destroyed, lost or stolen Debenture shall be at any time enforceable) and shall
be entitled to all benefits of this Indenture equally and ratably with any and
all other Debentures duly issued hereunder.
The provisions of this Section 2.09 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Debentures.
2.10 Outstanding Debentures; Determinations of Holders' Action.
Debentures outstanding at any time are all the Debentures authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation, those mutilated, destroyed, lost or stolen Debentures referred to
in Section 2.09 hereof, those redeemed by the Company pursuant to Article 3
hereof, and those described in this Section 2.10 as not outstanding. A Debenture
does not cease to be outstanding because the Company or a Subsidiary or
Affiliate thereof holds the Debenture; provided, however, that in determining
whether the Holders of the requisite principal amount of Debentures have given
or concurred in any request, demand, authorization, direction, notice, consent
or waiver hereunder, Debentures owned by the Company or a Subsidiary or
Affiliate (other than any Trust so long as any of the Preferred Securities of
such Trust are outstanding) shall be disregarded and deemed not to be
outstanding.
Subject to the foregoing, only Debentures outstanding at the time of such
determination shall be considered in any such determination (including
determinations pursuant to Articles 3, 6 and 9).
If a Debenture is replaced pursuant to Section 2.09 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Debenture is held by a bona fide purchaser.
If the Paying Agent (other than the Company) holds, in accordance with
this Indenture, at the Stated Maturity Date or on a Redemption Date, money
sufficient to pay the Debentures payable on that date, then immediately on the
Stated Maturity Date or such
16
Redemption Date, as the case may be, such Debentures shall cease to be
outstanding, and interest, if any, on such Debentures shall cease to accrue.
2.11 Temporary Debentures.
The Company may execute temporary Debentures, and upon the Company's
Order, the Trustee shall authenticate and make such temporary Debentures
available for delivery. Temporary Debentures shall be printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
in the same series and principal amount and of like tenor as the definitive
Debentures in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the Officers of the
Company executing such Debentures may determine, as conclusively evidenced by
their execution of such Debentures.
After the preparation of definitive Debentures, the temporary Debentures
shall be exchangeable for definitive Debentures of the same series upon
surrender of the temporary Debentures at the office or agency of the Company
designated for such purpose pursuant to Section 2.05 hereof, without charge to
the Holders thereof. Upon surrender for cancellation of any one or more
temporary Debentures, the Company shall execute a like principal amount of
definitive Debentures of the same series of authorized denominations, and the
Trustee, upon receipt of a Company Order, shall authenticate and make such
Debentures available for delivery in exchange therefor. Until so exchanged, the
temporary Debentures shall in all respects be entitled to the same benefits
under this Indenture as definitive Debentures.
2.12 Book-Entry System.
In order to utilize a book-entry-only system for all or any portion of the
Debentures of any series, all or a portion of the Debentures of any series may
be issued in the form of one or more fully registered Debentures of the same
series for the aggregate principal amount of such Debentures of each Issue Date,
interest rate and Stated Maturity Date (a "global Debenture"), which global
Debenture shall be registered in the name of the depositary (the "Depositary")
selected by the Company or in the name of such Depositary's nominee. Each global
Debenture shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary's instruction and shall bear a legend substantially to the following
effect: "Except as otherwise provided in Section 2.12 of the Indenture, this
Debenture may be transferred, in whole but not in part, only to another nominee
of the Depositary or to a successor Depositary or to a nominee of such successor
Depositary."
Notwithstanding any other provision of this Section 2.12 or of Section
2.08 hereof, a global Debenture may be transferred in whole but not in part and
in the manner provided in Section 2.08 hereof, only by a nominee of the
Depositary for such series, or by the Depositary or any such nominee of a
successor Depositary for such series selected or approved by the Company or to a
nominee of such successor Depositary.
If (i) at any time the Depositary for global Debentures of any series of
Debentures notifies the Company that it is unwilling or unable to continue as
Depositary for such global Debentures or if at any time the Depositary for such
global Debentures shall no longer be
17
registered or in good standing under the Exchange Act or other applicable
statute or regulation, and a successor Depositary for such global Debentures is
not appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such condition, as the case may be, (ii) the Company
determines in its sole discretion, that the Debentures of any series shall no
longer be represented by one or more global Debentures and delivers to the
Trustee an Officer's Certificate evidencing such determination or (iii) an Event
of Default occurs and is continuing, then the provisions of this Section 2.12
shall no longer apply to the Debentures of such series. In such event, the
Company will execute and the Trustee, upon receipt of an Officer's Certificate
evidencing such determination by the Company, will authenticate and deliver
Debentures of such series and of like tenor in definitive registered form, in
authorized denominations, and in aggregate principal amount equal to the
principal amount of the global Debentures of such series in exchange for such
global Debentures. Upon the exchange of global Debentures for such Debentures in
definitive registered form without coupons, in authorized denominations, the
global Debentures shall be cancelled by the Trustee. Such Debentures in
definitive registered form issued in exchange for global Debentures pursuant to
this Section 2.12 shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Debentures to the Persons in whose names such Debentures are
so registered.
Except as provided above, owners of beneficial interests in a global
Debenture shall not be entitled to receive physical delivery of Debentures in
definitive form and will not be considered the Holders thereof for any purpose
under this Indenture.
Members of or participants in the Depositary shall have no rights under
this Indenture with respect to any global Debenture held on their behalf by the
Depositary, and such Depositary or its nominee, as the case may be, may be
treated by the Company, the Trustee, and any agent of the Company or the Trustee
as the Holder of such global Debentures for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee, or any agent of the Company or the Trustee, from giving effect to any
written certification proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and its members or participants, the
operation of customary practices governing exercise of the rights of a Holder of
any Debenture, including without limitation the granting of proxies or other
authorization of participants to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action which a Holder
is entitled to give or take under this Indenture.
2.13 Cancellation.
All Debentures surrendered for payment, redemption by the Company pursuant
to Article 3 hereof or registration of transfer or exchange shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly canceled by the Trustee. The Company may at any time
deliver to the Trustee for cancellation any Debentures previously authenticated
and made available for delivery hereunder which the Company may have acquired in
any manner whatsoever, and all Debentures so delivered shall be promptly
canceled by the Trustee. The Company may not reissue or issue new Debentures to
replace Debentures it has
18
paid or delivered to the Trustee for cancellation. No Debentures shall be
authenticated in lieu of or in exchange for any Debentures canceled as provided
in this Section 2.13, except as expressly permitted by this Indenture. All
canceled Debentures held by the Trustee shall be disposed of in accordance with
its customary procedures.
ARTICLE 3
REDEMPTION
3.01 Redemption: Notice to Trustee.
(a) The Series D Debentures are subject to redemption prior to maturity as
provided therein.
(b) The redemption terms for any additional series of Debentures shall be
as specified therein or in the supplemental indenture creating such series of
Debentures.
(c) If any or all of the Debentures are to be redeemed pursuant to Section
3.01 (a) or (b) hereof, the Company shall deliver to the Trustee at least 45
days prior to the Redemption Date a Company Order specifying the series and
principal amount of Debentures to be redeemed and the Redemption Date and
Redemption Price for such Debentures. Such Company Order shall be accompanied by
a Board Resolution authorizing such redemption. If the Debentures of a series
are held by a Trust, the Company shall also deliver a copy of such Company Order
to the Property Trustee for such Trust.
3.02 Selection of Debentures to be Redeemed.
If less than all the outstanding Debentures of a series are to be redeemed
at any time, the Trustee shall select the Debentures of such series to be
redeemed by lot or by any other method the Trustee considers fair and
appropriate. The Trustee shall make the selection at least 30 but not more than
60 days before the Redemption Date from outstanding Debentures of such series
not previously called for redemption. Provisions of this Indenture that apply to
Debentures called for redemption also apply to portions of Debentures called for
redemption. The Trustee shall notify the Company promptly of the Debentures or
portions of Debentures to be redeemed.
3.03 Notice of Redemption.
At least 30 days but not more than 60 days before the Redemption Date, the
Trustee, in the Company's name and at the Company's expense, shall mail or cause
to be mailed a notice of redemption by first-class mail, postage prepaid, to
each Holder of Debentures to be redeemed at such Holder's last address as it
appears in the Register.
The notice of redemption shall identify the Debentures to be redeemed,
including its CUSIP number (if applicable), the provision of the Debentures or
this Indenture pursuant to which the Debentures called for redemption are being
redeemed and shall state:
19
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that payment of the Redemption Price of Debentures called for
redemption will be made only upon surrender of such Debentures to the Paying
Agent;
(5) if fewer than all the outstanding Debentures of any series are to be
redeemed, the identification and principal amounts of the particular Debentures
to be redeemed and that, on and after the Redemption Date, upon surrender of
such Debentures, a new Debenture or Debentures of the same series and of like
tenor and in a principal amount equal to the unredeemed portion thereof will be
issued; and
(6) that, unless the Company defaults in paying the Redemption Price of
the Debentures called for redemption, plus accrued interest thereon to the
Redemption Date, interest will cease to accrue on such Debentures on and after
the Redemption Date.
Any notice of redemption given in the manner provided herein shall be
conclusively presumed to have been given, whether or not such notice is actually
received. Failure to mail any notice or defect in the mailed notice or the
mailing thereof in respect of any Debenture shall not affect the validity of the
redemption of any other Debenture.
3.04 Effect of Notice of Redemption.
After notice of redemption has been given, Debentures called for
redemption shall become due and payable on the Redemption Date and at the
Redemption Price and from and after the Redemption Date (unless the Company
shall default in the payment of the Redemption Price and accrued interest), such
Debentures shall cease to bear interest. Upon the later of the Redemption Date
and the date such Debentures are surrendered to the Paying Agent, such
Debentures shall be paid at the Redemption Price, plus accrued interest to the
Redemption Date, provided that installments of interest on Debentures with an
Interest Payment Date which is on or prior to the Redemption Date shall be
payable to the Holders of such Debentures, or one or more Predecessor
Debentures, registered as such at the close of business on the Regular Record
Dates therefor according to their terms and provisions.
3.05 Deposit of Redemption Price.
Prior to 10:00 a.m. the Redemption Date, the Company shall deposit with
the Paying Agent (or if the Company or an Affiliate is the Paying Agent, shall
segregate and hold in trust or cause such Affiliate to segregate and hold in
trust) money sufficient to pay the Redemption Price of, and accrued interest on,
all Debentures to be redeemed on that Redemption Date. The Paying Agent shall
return to the Company any money in excess of the amount sufficient to pay the
Redemption Price of, and accrued interest on, all Debentures to be redeemed and
any interest accrued on the amount deposited pursuant to this Section 3.05.
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3.06 Debentures Redeemed in Part.
Upon surrender of a Debenture that is redeemed in part, the Trustee shall
authenticate for the Holder a new Debenture of the same series and in a
principal amount equal to the unredeemed portion of such Debenture.
ARTICLE 4
COVENANTS
4.01 Payment of Debentures.
(a) The Company shall pay the principal of and premium, if any, and
interest (including interest accruing during an Extension Period and/or on or
after the filing of a petition in bankruptcy or reorganization relating to the
Company, whether or not a claim for post-filing interest is allowed in such
proceeding) on the Debentures on or prior to the dates and in the manner
provided in such Debentures or pursuant to this Indenture. An installment of
principal, premium, if any, or interest shall be considered paid on the
applicable due date if on such date the Trustee or the Paying Agent holds, in
accordance with this Indenture, money sufficient to pay all of such installment
then due. With respect to any Debenture, the Company shall pay interest on
overdue principal and interest on overdue installments of interest (including
interest accruing during an Extension Period and/or on or after the filing of a
petition in bankruptcy or reorganization relating to the Company, whether or not
a claim for post-filing interest is allowed in such proceeding), to the extent
lawful, at the rate per annum borne by such Debenture, compounded quarterly.
Interest on overdue interest shall accrue from the date such amounts become
overdue.
(b) Notwithstanding the provisions of Section 4.01(a) hereof or any other
provision herein to the contrary, the Company shall have the right in its sole
and absolute discretion at any time and from time to time while the Debentures
of any series are outstanding, so long as no Event of Default with respect to
such series of Debentures has occurred and is continuing, to defer payments of
interest by extending the interest payment period for such series of Debentures
for the Extension Period, if any, for such series of Debentures, provided that
such Extension Period shall not extend beyond the Stated Maturity Date or
Redemption Date of any Debenture of such series, and provided further that at
the end of each Extension Period the Company shall pay all interest then accrued
and unpaid (together with interest thereon to the extent permitted by applicable
law at the rate per annum then borne by such Debentures). Prior to the
termination of an Extension Period, the Company may shorten or may further
extend the interest payment period for such series of Debentures, provided that
such Extension Period together with all such previous and further extensions may
not exceed the maximum duration of the Extension Period for such series of
Debentures or extend beyond the Stated Maturity Date or Redemption Date of any
Debenture of such series. The Company shall give the Trustee notice of the
Company's election to begin an Extension Period for any series of Debentures and
any shortening or extension thereof at least one Business Day prior to the date
the notice of the record or payment date of the related distribution on the
Preferred Securities issued by the Trust which is the Holder of the Debentures
of such series or the date payment of interest on such Debentures is required to
be given to any national securities exchange on which such Preferred Securities
or Debentures are then listed or other applicable self-regulatory organization,
but in
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any event not less than two Business Days prior to the Record Date fixed by the
Company for the payment of such interest. The Company shall give or cause the
Trustee to give notice (a form of which shall be provided by the Company to the
Trustee) of the Company's election to begin an Extension Period to the Holders
by first class mail, postage prepaid.
4.02 Prohibition Against Dividends. etc.
The Company shall not declare or pay any dividend on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its Capital Stock
(i) during an Extension Period, (ii) if at such time there shall have occurred
and is continuing any Default or Event of Default, or (iii) if the Company shall
be in default with respect to its payment or other obligations under any
Guarantee Agreement.
4.03 SEC Reports.
The Company shall file with the Trustee, within 15 days after it files
them with the SEC, copies of its annual report and of the information, documents
and other reports (or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company is required to file
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the Company
is not subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall file with the Trustee such information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which are specified in
Sections 13 or 15(d) of the Exchange Act. The Company shall also comply with the
provisions of Section 314(a) of the TIA. Delivery of such reports, information
and documents to the Trustee is for informational purposes only and the
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to conclusively rely exclusively on
Officer's Certificates).
4.04 Compliance Certificates.
(a) The Company shall deliver to the Trustee, within 90 days after the end
of each of the Company's fiscal years, an Officer's Certificate stating whether
or not the signer knows of any Default or Event of Default. Such certificate
shall contain a certification from the principal executive officer, principal
financial officer or principal accounting officer of the Company as to his or
her knowledge of the Company's compliance with all conditions and covenants
under this Indenture. For purposes of this Section 4.04(a), such compliance
shall be determined without regard to any period of grace or requirement of
notice provided under this Indenture. If such Officer does know of such a
Default or Event of Default, the Officer's Certificate shall describe any such
Default or Event of Default, and its status. Such Officer's Certificate need not
comply with Sections 11.04 and 11.05 hereof.
(b) The Company shall deliver to the Trustee any information reasonably
requested by the Trustee in connection with the compliance by the Trustee or the
Company with the TIA.
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4.05 Further Instruments and Acts.
Upon request of the Trustee, the Company shall execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
4.06 Payments for Consents.
Neither the Company nor any Subsidiary shall, directly or indirectly, pay
or cause to be paid any consideration, whether by way of interest, fee or
otherwise, to any Holder of any Debentures for or as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this Indenture
or the Debentures unless such consideration is offered to be paid or agreed to
be paid to all Holders of the Debentures who so consent, waive or agree to amend
in the time frame set forth in the documents soliciting such consent, waiver or
agreement.
4.07 Payment of Expenses of Trusts.
The Company covenants for the benefit of the Holders of the Debentures to
pay all of the obligations, costs and expenses of the applicable Trust in
accordance with the applicable Trust agreement and to pay the taxes of such
Trust in accordance with such Trust agreement in order to permit such Trust to
make distributions on and redemptions of its Preferred Securities in accordance
with their terms.
ARTICLE 5
SUCCESSOR CORPORATION
5.01 When the Company May Merge, Etc.
The Company may not consolidate with or merge with or into, or sell,
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety (either in one transaction or a series of
transactions) to, any Person unless:
(1) the Person formed by or surviving such consolidation or merger or to
which such sale, conveyance, transfer or lease shall have been made (the
"Successor") if other than the Company (a) is a corporation organized and
existing under the laws of the United States of America or any State thereof or
the District of Columbia, and (b) shall expressly assume by a supplemental
indenture, executed and delivered to the Trustee, in form satisfactory to the
Trustee, all the obligations of the Company under the Debentures and the
Indenture;
(2) immediately prior to and after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor Person or
any Subsidiary as a result of such transaction as having been incurred by such
Person or such Subsidiary at the time of such transaction), no Default or Event
of Default shall have occurred and be continuing; and
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(3) the Company delivers to the Trustee an Officer's Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, sale,
conveyance, transfer or lease and such supplemental indenture comply with this
Indenture.
The Successor will be the successor to the Company, and will be
substituted for, and may exercise every right and power and become the obligor
on the Debentures with the same effect as if the Successor had been named as the
Company herein but, in the case of a sale, conveyance, transfer or lease of all
or substantially all of the assets of the Company, the predecessor Company will
not be released from its obligation to pay the principal of and premium, if any,
and interest on the Debentures.
ARTICLE 6
DEFAULTS AND REMEDIES
6.01 Events of Default.
An "Event of Default" occurs with respect to the Debentures of any series
if one of the following shall have occurred and be continuing:
(1) The Company defaults in the payment, when due and payable, of (a)
interest on any Debenture of that series and the default continues for a period
of 30 days; provided, that during an Extension Period for the Debentures of that
series, failure to pay interest on the Debentures of that series shall not
constitute a Default or Event of Default hereunder, or (b) the principal of or
premium, if any, on any Debentures of that series when the same becomes due and
payable on the Stated Maturity Date thereof, upon acceleration, on any
Redemption Date, or otherwise;
(2) The Company defaults in the performance of or fails to comply with any
of its other covenants or agreements in the Debentures of that series or this
Indenture or in any supplemental indenture under which the Debentures of that
series may have been issued and such failure continues for 60 days after receipt
by the Company of a "Notice of Default";
(3) The Company, pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case or proceeding;
(b) consents to the entry of an order for relief against it in an
involuntary case or proceeding;
(c) consents to the appointment of a Custodian of it or for all or
substantially all of its property, and such Custodian is not
discharged within 60 days;
(d) makes a general assignment for the benefit of its creditors;
or
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(e) admits in writing its inability to pay its debts generally as
they become due; or
(4) A court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(a) is for relief against the Company in an involuntary case or
proceeding;
(b) appoints a Custodian of the Company for all or substantially
all of its properties;
(c) orders the liquidation of the Company;
(d) and in each case the order or decree remains unstayed and in
effect for 60 days.
The foregoing will constitute an Event of Default whatever the reason for
any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Title 11 of the United States Code, or any
similar federal or state law for the relief of debtors. "Custodian" means any
receiver, trustee, assignee, liquidator, sequestrator, custodian or similar
official under any Bankruptcy Law.
A Default under clause (2) above is not an Event of Default until (i) the
Trustee provides a "Notice of Default" to the Company or the Holders of at least
25% in aggregate principal amount of the Debentures of that series at the time
outstanding or, if that series of Debentures is held by a Trust, the holders of
at least 25% in aggregate liquidation amount of the outstanding Preferred
Securities of that Trust provide a "Notice of Default" to the Company and the
Trustee and (ii) the Company does not cure such Default within the time
specified in clause (2) above after receipt of such notice. Any such notice must
specify the Default, demand that it be remedied and state that such notice is a
"Notice of Default."
6.02 Acceleration.
If any Event of Default with respect to the Debentures of any series other
than an Event of Default under clause (3) or (4) of Section 6.01 hereof occurs
and is continuing, the Trustee or the Holders of at least 25% in aggregate
principal amount of the Debentures of that series then outstanding may declare
the principal of all the Debentures of that series due and payable, provided
that in the case of a series of Debentures then held by a Trust, if upon an
Event of Default with respect to the Debentures of that series the Trustee has
or the Holders of at least 25% in aggregate principal amount of the Debentures
of that series have failed to declare the principal of the Debentures of that
series to be immediately due and payable, the holders of at least 25% in
aggregate liquidation amount of the outstanding Preferred Securities of that
Trust shall have such right by a notice in writing to the Company and the
Trustee. If an Event of
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Default specified in clause (3) or (4) of Section 6.01 hereof occurs, the
principal of and interest on all the Debentures shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Debentureholders. Upon such an acceleration, such principal,
together with all interest accrued thereon, shall be due and payable
immediately.
The Holders of a majority in aggregate principal amount of the Debentures
of that series at the time outstanding, in each case, by notice to the Trustee,
may rescind such an acceleration and its consequences if the rescission would
not conflict with any judgment or decree and if all existing Events of Default
with respect to such series of Debentures have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration, provided that if the principal of a series of Debentures has been
declared due and payable by the holders of the Preferred Series of a Trust, no
rescission of acceleration will be effective unless consented to by the holders
of a majority in aggregate liquidation amount of the Preferred Securities of
that Trust. No such rescission shall affect any subsequent Default or impair any
right consequent thereto.
6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may, in its
own name or as trustee of an express trust, institute, pursue and prosecute any
proceeding, including, without limitation, any action at law or suit in equity
or other judicial or administrative proceeding to collect the payment of
principal of or premium, if any, or interest on the Debentures of the series
that is in default, to enforce the performance of any provision of the
Debentures of that series or this Indenture or to obtain any other available
remedy.
The Trustee may maintain a proceeding even if it does not possess any of
the Debentures or does not produce any of the Debentures in the proceeding. A
delay or omission by the Trustee, any Debentureholder or the holders of
Preferred Securities in exercising any right or remedy accruing upon an Event of
Default shall not impair such right or remedy or constitute a waiver of, or
acquiescence in, such Event of Default. No remedy is exclusive of any other
remedy. All available remedies are cumulative.
6.04 Waiver of Past Defaults.
If a Default or Event of Default with respect to a series of Debentures
has occurred and is continuing, the Holders of a majority in aggregate principal
amount of the Debentures of that series at the time outstanding, or, if that
series of Debentures is held by a Trust, the holders of a majority in aggregate
liquidation amount of the Preferred Securities of that Trust, in each case by
notice to the Trustee and the Company, may waive an existing Default or Event of
Default and its consequences except a Default or Event of Default in the payment
of the principal of or premium, if any, or interest on any Debenture of that
series. When a Default or Event of Default is waived, it is deemed cured and
shall cease to exist, but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any consequent right.
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6.05 Control by Majority.
The Holders of a majority in aggregate principal amount of the Debentures
of each series affected or, if that series of Debentures is held by a Trust, the
holders of a majority in aggregate liquidation amount of the Preferred
Securities of that Trust, may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or of exercising any
trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture or that the
Trustee determines in good faith is unduly prejudicial to the rights of other
Debentureholders or may involve the Trustee in personal liability. The Trustee
may take any other action deemed proper by the Trustee which is not inconsistent
with such direction, including withholding notice to the Holders of the
Debentures of continuing default (except in the payment of the principal of
(other than any mandatory sinking fund payment) or premium, if any, or interest
on any Debentures) if the Trustee considers it in the interest of the Holders of
the Debentures to do so.
6.06 Limitation on Suits.
Except as provided in Section 6.07 hereof, no holder of Debentures or
holder of Preferred Securities of the Trust which is the Holder of that series
of Debentures may pursue any remedy with respect to this Indenture or the
Debentures unless:
(1) the Holders of Debentures or the holders of such Preferred Securities
give to the Trustee written notice stating that an Event of Default with respect
to the corresponding Debentures is continuing;
(2) the Holders of at least 25% in aggregate principal amount of the
Debentures of that series or the holders of at least 25% in aggregate
liquidation amount of such Preferred Securities make a written request to the
Trustee to pursue a remedy;
(3) the Holders of Debentures or the holders of such Preferred Securities
provide to the Trustee reasonable security and indemnity against any loss,
liability or expense satisfactory to the Trustee;
(4) the Trustee does not comply with the request within 60 days after
receipt of the notice, the request and the offer of security and indemnity; and
(5) during such 60 day period, the Holders of a majority in aggregate principal
amount of the Debentures of that series or the holders of a majority in
aggregate liquidation amount of such Preferred Securities do not give the
Trustee a direction inconsistent with the request.
A Holder of Debentures or a holder of Preferred Securities may not use
this Indenture to prejudice the rights of another Debentureholder or a holder of
Preferred Securities or to obtain a preference or priority over another
Debentureholder or holder of Preferred Securities.
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6.07 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of the principal of and premium (if any) or interest
on the Debentures held by such Holder, on or after the respective due dates
expressed in the Debentures (in the case of interest, as the same may be
extended pursuant to Section 4.01(b) hereof) or any Redemption Date, is absolute
and unconditional and such right and the right to bring suit for the enforcement
of any such payment on or after such respective dates shall not be impaired or
affected adversely without the consent of such Holder. If the Debentures of a
series are then held by a Trust, each holder of Preferred Securities of such
Trust shall have the right to bring suit for the enforcement of any payment due
in respect of Debentures of such series based on a principal amount thereof
equal to the aggregate liquidation amount of the Preferred Securities of such
holder.
6.08 Collection Suit by the Trustee.
If an Event of Default described in Section 6.01(1) hereof occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or any obligor on the Debentures for the
whole amount owing with respect to the Debentures and the amounts provided for
in Section 7.07 hereof.
6.09 The Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or its properties or assets, the
Trustee shall be entitled and empowered, by intervention in such proceeding or
otherwise:
(1) to file and prove a claim for the whole amount of the principal of and
premium, if any, and interest on the Debentures and to file such other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding; and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any Custodian in
any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay the Trustee any amount
due it for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debentures
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
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6.10 Priorities.
If the Trustee collects any money pursuant to this Article 6 with respect
to a series of Debentures, it shall, subject to Article 10 hereof (to the extent
that Article 10 hereof is applicable to such series), pay out the money in the
following order:
First: to the Trustee for amounts due under Section 7.07 hereof;
Second: to Holders of Debentures of the particular series in respect of
which or
for the benefit of which such money has been collected for amounts
due and unpaid on such Debentures for the principal amount,
Redemption Price or interest, if any, as the case may be, ratably,
without preference or priority of any kind, according to such
amounts due and payable on such Debentures; and
Third: the balance, if any, to the Company.
Except as otherwise set forth in the Debentures, the Trustee may fix a
Record Date and payment date for any payment to Debentureholders pursuant to
this Section 6.10.
6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant (other than the Trustee) in the suit of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant in
the suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. This Section 6.11 does not apply to a suit
by the Trustee, a suit by a Holder of Debentures or holder of Preferred
Securities pursuant to Section 6.07 hereof or a suit by Holders of Debentures of
more than 10% in aggregate principal amount of the Debentures of any series or,
if a series of Debentures is held by a Trust, the holders of more than 10% in
aggregate liquidation amount of the Preferred Securities of that Trust.
6.12 Waiver of Stay; Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury or
other law wherever enacted, now or at any time hereafter in force, that would
prohibit or forgive the Company from paying all or any portion of the principal
of or premium, if any, or interest on the Debentures as contemplated herein or
affect the covenants or the performance by the Company of its obligations under
this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
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ARTICLE 7
THE TRUSTEE
7.01 Duties of the Trustee.
(a) If an Event of Default occurs and is continuing with respect to the
Debentures of any series, the Trustee shall exercise the rights and powers
vested in it by this Indenture with respect to that series and use the same
degree of care and skill in its exercise as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default with respect to
the Debentures of any series, (i) the Trustee need perform only those duties
with respect to that series that are specifically set forth in this Indenture or
the TIA and no implied covenants or obligations shall be read into the Indenture
against the Trustee; and (ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture.
However, in the case of any certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(i) this Section 7.01(c) does not limit the effect of Section
7.01(b) hereof;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to Section 7.01(a), (b), (c) and (e) and Section 7.02 hereof.
(e) The Trustee may refuse to perform any duty or exercise any right or
power or extend or risk its own funds or otherwise incur any financial liability
unless it receives security and indemnity reasonably satisfactory to it against
any loss, liability or expense (including reasonable counsel fees).
(f) Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. Except as otherwise
provided in Section 3.05 and Section 8.01 hereof, the Trustee shall not be
liable for interest on any money held by it hereunder.
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7.02 Rights of the Trustee.
(a) The Trustee may conclusively rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate and, if appropriate, an Opinion of Counsel. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officer's Certificate and Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it reasonably believes to be authorized or within its
rights or powers.
(e) The Trustee may consult with counsel of its selection and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security and indemnity against the costs, expenses and
liabilities (including reasonable counsel fees) which might be incurred by it in
compliance with such request or direction.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney
at the sole cost of the Company and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation.
(h) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
(i) The Trustee shall not be deemed to have notice of any Default or Event
of Default unless a Responsible Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact such a default is
received by the Trustee at the
31
Corporate Trust Office of the Trustee, and such notice references the Securities
and this Indenture.
(j) The rights, privileges, protections, immunities and benefits given to
the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each agent, custodian and other Person employed to act hereunder.
(k) The Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded.
7.03 Individual Rights of the Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Debentures and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar or co-registrar may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11 hereof.
7.04 The Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Debentures. The Trustee shall not be accountable for the
Company's use of the proceeds from the Debentures, and the Trustee shall not be
responsible for any statement in this Indenture or the Debentures or any report
or certificate issued by the Company hereunder or any registration statement
relating to the Debentures (other than the Trustee's Certificate of
Authentication and the Trustee's Statement of Eligibility on Form T-1), or the
determination as to which beneficial owners are entitled to receive any notices
hereunder.
7.05 Notice of Defaults.
If a Default occurs and is continuing with respect to the Debentures of
any series and if it is known to the Trustee, the Trustee shall mail to each
Holder of a Debenture of that series notice of the Default within 90 days after
it becomes known to the Trustee unless such Default shall have been cured or
waived. Except in the case of a Default described in Section 6.01(1) hereof, the
Trustee may withhold such notice if and so long as a committee of its Trust
Officers in good faith determines that the withholding of such notice is in the
interests of the Holders of the Debentures of that series. The Trustee shall not
be charged with knowledge of any Default (except in the case of a Default under
Section 6.01(1) hereof) unless a Responsible Officer assigned to the Corporate
Trust Department of the Trustee shall have actual knowledge of the Default. The
second sentence of this Section 7.05 shall be in lieu of the proviso to TIA
Section 315(b). Said proviso is hereby expressly excluded from this Indenture,
as permitted by the TIA.
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7.06 Reports by Trustee to Holders. Within 60 days after each May 31,
beginning with the May 31 next following the date of this Indenture, the Trustee
shall mail to each Debentureholder, and such other holders that have submitted
their names to the Trustee for such purpose, a brief report dated as of such May
31 in accordance with and to the extent required under TIA Section 313.
A copy of each report at the time of its mailing to Debentureholders shall
be filed with the Company, the SEC and any securities exchange on which the
Debentures are listed. The Company agrees to promptly notify the Trustee
whenever the Debentures become listed on any securities exchange and of any
listing thereof.
7.07 Compensation and Indemnity.
The Company agrees:
(1) to pay to the Trustee from time to time such compensation as shall be
agreed in writing between the Company and the Trustee for all services rendered
by it hereunder (which compensation shall not be limited by any provision of law
in regard to the compensation of a trustee of an express trust);
(2) to reimburse the Trustee upon its request for reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture (including the reasonable compensation and the
expenses, and advances of its agents and counsel, provided that prior to any
Event of Default, the Trustee shall only have one counsel), including all
reasonable expenses and advances incurred or made by the Trustee in connection
with any Event of Default or any membership on any creditors' committee, except
any such expense or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee, its officers, directors and shareholders,
for, and to hold it harmless against, any and all loss, liability or expense,
including taxes (other than taxes based upon the income of the Trustee),
incurred without negligence or willful misconduct on its part, arising out of or
in connection with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim (whether asserted by
the Company, any Holder or any other person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
Before, after or during an Event of Default with respect to the Debentures
of a series, the Trustee shall have a claim and lien prior to the Debentures of
that series as to all property and funds held by it hereunder for any amount
owing it for its fees and expenses or any predecessor Trustee pursuant to this
Section 7.07, except with respect to funds held by the Trustee or any Paying
Agent in trust for the payment of principal of or premium, if any, or interest
on particular Debentures pursuant to Section 2.06 or Section 8.01 hereof.
The Company's obligations pursuant to this Section 7.07 are not subject to
Article 10 of this Indenture (regardless of the applicability of such Article to
a series of Debentures) and shall survive the discharge of this Indenture and
the removal or resignation of the Trustee. When
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the Trustee renders services or incurs expenses after the occurrence of a
Default specified in Section 6.01 hereof, the compensation for services and
expenses are intended to constitute expenses of administration under any
Bankruptcy Law.
7.08 Replacement of Trustee.
The Trustee may resign at any time, by so notifying the Company in writing
at least 30 days prior to the date of the proposed resignation; provided,
however, no such resignation shall be effective until a successor Trustee has
accepted its appointment pursuant to this Section 7.08. The Holders of at least
a majority in aggregate principal amount of the Debentures at the time
outstanding may remove the Trustee by so notifying the Trustee in writing and
may appoint a successor Trustee, which shall be subject to the consent of the
Company unless an Event of Default has occurred and is continuing. The Trustee
shall resign if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge of the Trustee or its
property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Debentureholders. Subject to payment of all amounts owing to the
Trustee under Section 7.07 hereof and subject further to its lien under Section
7.07, the retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee. If a successor Trustee does not take office
within 30 days after the retiring Trustee resigns or is removed, the retiring
Trustee (at the expense of the Company), the Company or the Holders of at least
a majority in aggregate principal amount of the Debentures at the time
outstanding may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any
Debentureholder may petition any court of competent jurisdiction for its removal
and the appointment of a successor Trustee.
7.09 Successor Trustee by Xxxxxx.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trust business or assets to another
corporation, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
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7.10 Eligibility: Disqualification.
The Trustee shall at all times satisfy the requirements of TIA Sections
310(a)(1) and 310(a)(2). The Trustee (or any Affiliate thereof which has
unconditionally guaranteed the obligations of the Trustee hereunder) shall have
a combined capital and surplus of at least $50,000,000 as set forth in its most
recently published annual report of condition. The Trustee shall comply with TIA
Section 310(b). In determining whether the Trustee has conflicting interests as
defined in TIA Section 310(b)(1), the provisions contained in the proviso to TIA
Section 310(b)(1) and the Trustee's Statement of Eligibility on Form T-1 shall
be deemed incorporated herein.
7.11 Preferential Collection of Claims Against the Company.
If and when the Trustee shall be or become a creditor of the Company, the
Trustee shall be subject to the provisions of the TIA regarding the collection
of claims against the Company.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE;
DEFEASANCE OF CERTAIN OBLIGATIONS; UNCLAIMED MONEYS
8.01 Satisfaction and Discharge of Indenture.
The Company shall be deemed to have paid and discharged the entire
indebtedness on any series of the Debentures outstanding on the date the Company
has irrevocably deposited or caused to be irrevocably deposited with the Trustee
or any Paying Agent as trust funds in trust, specifically pledged as security
for, and dedicated solely to, the benefit of the Holders of the Debentures of
such series (1) cash (which may be held in an interest bearing account insured
by the Federal Deposit Insurance Corporation) in an amount, or (2) U.S.
Government Obligations, maturing as to principal and interest at such times and
in such amounts as will ensure the availability of cash, or (3) a combination
thereof, sufficient to pay the principal of and premium, if any, and interest on
all Debentures of such series then outstanding on the scheduled due dates
therefor, provided that the following conditions shall have been met:
(A) no Default or Event of Default with respect to the Debentures of
such series has occurred and is continuing on the date of such
deposit or occurs as a result of such deposit;
(B) the Company has delivered to the Trustee an Officer's
Certificate certifying that there does not exist (i) a default in
the payment of all or any portion of any Senior Indebtedness or (ii)
any other default affecting Senior Indebtedness permitting its
acceleration as the result of which the maturity of Senior
Indebtedness has been accelerated;
(C) the Company has delivered to the Trustee (i) either a private
Internal Revenue Service ruling or an Opinion of Counsel to the
effect that, based on a change in law occurring after the execution
of this Indenture, the
35
Holders of the Debentures of such series will not recognize income,
gain or loss for federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to federal
income tax on the same amount and in the manner and at the same
times as would have been the case if such deposit, defeasance and
discharge had not occurred, and an Opinion of Counsel to the effect
that (A) the deposit shall not result in the Company, the Trustee
or, if the Debentures of such series are held by a Trust, such Trust
being deemed to be an "investment company" under the Investment
Company Act of 1940, as amended, and (B) such deposit creates a
valid trust in which the Holders of the Debentures of such series
have the sole beneficial interest or that the Holders of the
Debentures of such series have a nonavoidable first priority
security interest in such trust; and
(D) the Company has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all
conditions precedent relating to the defeasance contemplated by this
provision have been complied with.
Upon such deposit, provisions of this Indenture with respect to such series of
Debentures shall no longer be in effect (except as to (1) the rights of
registration of transfer and exchange of Debentures of such series, (2) the
replacement of apparently mutilated, defaced, destroyed, lost or stolen
Debentures of such series, (3) the rights of the Holders of the Debentures of
such series to receive payments of the principal thereof and premium, if any,
and interest thereon, (4) the rights of the Holders of the Debentures of such
series as beneficiaries hereof with respect to the property so deposited with
the Trustee payable to all or any of them, (5) the obligation of the Company to
maintain an office or agency for payments on and registration of transfer of the
Debentures of such series, (6) the rights, obligations and immunities of the
Trustee hereunder, and (7) the obligations of the Company to the Trustee for
compensation and indemnity under Section 7.07 hereof), and the Trustee shall, at
the request and expense of the Company, execute proper instruments acknowledging
the same.
8.02 Application by Trustee of Funds Deposited for Payment of Debentures.
Subject to Section 8.04 hereof, all moneys deposited with the Trustee
pursuant to Section 8.01 hereof shall be held in trust and applied by it to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent), to the Holders of the Debentures of the series
for the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal and interest;
but such money need not be segregated from other funds except to the extent
required by law.
8.03 Repayment of Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture, all
moneys then held by any Paying Agent under this Indenture shall, upon demand of
the Company, be
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repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
8.04 Return of Moneys Held by the Trustee and Paying Agent Unclaimed for
Three Years.
Any moneys deposited with or paid to the Trustee or any Paying Agent for
the payment of the principal of and premium, if any, or interest on the
Debentures of any series and not applied but remaining unclaimed for three years
after the date when such principal, premium, if any, or interest shall have
become due and payable shall, unless otherwise required by mandatory provisions
of applicable escheat or abandoned or unclaimed property law, be repaid to the
Company by the Trustee or such Paying Agent, and the Holders of such Debentures
shall, unless otherwise required by mandatory provisions of applicable escheat
or abandoned or unclaimed property laws, thereafter look only to the Company for
any payment which such Holder may be entitled to collect, and all liability of
the Trustee or any Paying Agent with respect to such moneys shall thereupon
cease.
ARTICLE 9
AMENDMENTS
9.01 Without Consent of Holders.
From time to time, when authorized by a resolution of the Board of
Directors, the Company and the Trustee, without notice to or the consent of any
Holders of the Debentures, may amend or supplement this Indenture:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Article 5 hereof;
(3) to provide for uncertificated Debentures in addition to or in place of
certificated Debentures;
(4) to make any other change that does not in the reasonable judgment of
the Company adversely affect the rights of any Debentureholder; provided that,
any amendment described in this clause (4) made solely to conform this Indenture
to the final prospectus provided to investors in connection with the initial
offering of the Preferred Securities will not be deemed to adversely affect the
rights of Debentureholders;
(5) to comply with any requirement of the SEC in connection with the
qualification of this Indenture under the TIA;
(6) to set forth the terms and conditions, which shall not be inconsistent
with this Indenture, of any series of Debentures (other than the Series D
Debentures) that are to be issued hereunder and the form of Debentures of such
series.
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9.02 With Consent of Holders.
The Company and the Trustee may amend this Indenture in any manner not
permitted by Section 9.01 or may waive future compliance by the Company with any
provisions of this Indenture with the consent of the Holders of a majority in
aggregate principal amount of the Debentures of each series affected thereby.
Such an amendment or waiver may not, without the consent of each Holder of the
Debentures affected thereby:
(1) reduce the principal amount of such Debentures;
(2) reduce the principal amount of such Debentures the Holders of which
must consent to an amendment of this Indenture or a waiver;
(3) change the stated maturity of the principal of or the interest on or
rate of interest on such Debentures or the manner of calculation thereof;
(4) change adversely to the Holders the redemption provisions of Article 3
hereof;
(5) change the currency in respect of which the payments on such
Debentures are to be made;
(6) to the extent Article 10 hereof is applicable to such Debentures, make
any change in Article 10 hereof that adversely affects the rights of the Holders
of such Debentures or any change to any other Section hereof that adversely
affects their rights under Article 10 hereof; or
(7) change Section 6.07 hereof;
provided that, in the case of the outstanding Debentures of a series then held
by a Trust, no such amendment shall be made that adversely affects the holders
of the Preferred Securities of that Trust, and no waiver of any Event of Default
with respect to the Debentures of that series or compliance with any covenant
under this Indenture shall be effective, without the prior consent of the
holders of a majority of the aggregate liquidation amount of the outstanding
Preferred Securities of that Trust or the holder of each such Preferred
Security, as applicable.
A supplemental indenture that changes or eliminates any covenant or other
provision of this Indenture that has expressly been included solely for the
benefit of one or more particular series of Debentures, or which modifies the
rights of the Holders of Debentures of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Debentures of any other series.
It shall not be necessary for the consent of the Holders of Debentures or
holders of Preferred Securities under this Section 9.02 to approve the
particular form of any proposed amendment, but it shall be sufficient if such
consent approves the substance thereof.
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If certain Holders agree to defer or waive certain obligations of the
Company hereunder with respect to Debentures held by them, such deferral or
waiver shall not affect the rights of any other Holder to receive the payment or
performance required hereunder in a timely manner.
After an amendment or waiver under this Section 9.02 becomes effective,
the Company shall mail to each Holder a notice briefly describing the amendment
or waiver. Any failure of the Company to mail such notices, or any defect
therein, shall not, however, in any way impair or affect the validity of such
amendment or waiver.
9.03 Compliance with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article 9 shall
comply with the TIA.
9.04 Revocation and Effect of Consents; Waivers and Actions.
Until an amendment, waiver or other action by Holders becomes effective, a
consent to it or any other action by a Holder of a Debenture hereunder is a
continuing consent by the Holder and every subsequent Holder of that Debenture
or portion of the Debenture that evidences the same obligation as the consenting
Holder's Debenture, even if notation of the consent, waiver or action is not
made on such Debenture. However, any such Holder or subsequent Holder may revoke
the consent, waiver or action as to such Holder's Debenture or portion of the
Debenture if the Trustee receives the notice of revocation before the consent of
the requisite aggregate principal amount of such Debentures then outstanding has
been obtained and not revoked. After an amendment, waiver or action becomes
effective, it shall bind every Holder of the Debentures of the related series,
except as provided in Section 9.02 hereof.
The Company may, but shall not be obligated to, fix a Record Date for the
purpose of determining the Persons entitled to consent to any amendment or
waiver. If a Record Date is fixed, then, notwithstanding the first two sentences
of the immediately preceding paragraph, only Holders of Debentures or holders of
Preferred Securities, as applicable, on such Record Date or their duly
designated proxies, and only those Persons, shall be entitled to consent to such
amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be such after such Record Date. No such
consent shall be valid or effective for more than 90 days after such Record
Date.
9.05 Notation on or Exchange of Debentures.
Debentures of the related series authenticated and made available for
delivery after the execution of any supplemental indenture pursuant to this
Article 9 may, and shall, if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Debentures so modified as to
conform, in the opinion of the Trustee and the Board of Directors, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and made available for delivery by the Trustee in exchange for
outstanding Debentures.
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9.06 Trustee to Execute Supplemental Indentures.
The Trustee shall execute any supplemental indenture authorized pursuant
to this Article 9 if the supplemental indenture does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, execute it. In executing such supplemental indenture
the Trustee shall be entitled to receive, and shall be fully protected in
relying upon, an Officer's Certificate and Opinion of Counsel stating that such
supplemental indenture is authorized or permitted by this Indenture.
9.07 Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article 9,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes and every Holder
of Debentures of the related series theretofore or thereafter authenticated and
made available for delivery hereunder shall be bound thereby.
ARTICLE 10
SUBORDINATION
10.01 Applicability of Article; Debentures Subordinated to Senior
Indebtedness.
(a) The provision of this Article 10 shall be applicable to each series of
Debentures unless the Debentures of such series provide otherwise. As used in
this Article, the term "Debentures" shall, to the extent the context requires,
refer only to Debentures to which the provisions of this Article 10 are
applicable.
(b) If not otherwise provided with respect to the Debentures of such
series, then notwithstanding the provisions of Section 6.10 hereof or any other
provision herein or in any Debenture, the Company and the Trustee and, by their
acceptance thereof, the Holders of the Debentures (i) covenant and agree that
all payments by the Company of the principal of and premium, if any, and
interest on the Debentures (other than Debentures which have been discharged
pursuant to Article 8) shall be subordinated in accordance with the provisions
of this Article 10 to the prior payment in full, in cash or cash equivalents, of
all amounts payable on, under or in connection with Senior Indebtedness, and
(ii) acknowledge that holders of Senior Indebtedness are or shall be relying on
this Article 10.
10.02 Priority and Payment of Proceeds in Certain Events: Remedies
Standstill.
(a) Upon any payment or distribution of assets or securities of the
Company, as the case may be, of any kind or character, whether in cash, property
or securities, upon any dissolution or winding up or total or partial
liquidation or reorganization of the Company, whether voluntary or involuntary,
or in bankruptcy, insolvency, receivership or other proceedings, all amounts
payable on, under or in connection with Senior Indebtedness (including any
interest accruing on such Senior Indebtedness subsequent to the commencement of
a
40
bankruptcy, insolvency or similar proceeding) shall first be paid in full in
cash, or payment provided for in cash or cash equivalents, before the Holders or
the Trustee on behalf of the Holders or the holders of Preferred Securities
shall be entitled to receive from the Company any payment of principal of or
premium, if any, or interest on the Debentures or distribution of any assets or
securities.
(b) No direct or indirect payment by or on behalf of the Company of
principal of or premium, if any, or interest on the Debentures (other than
Debentures which have been discharged pursuant to Article 8), whether pursuant
to the terms of the Debentures or upon acceleration or otherwise, shall be made
if, any the time of such payment, there exists (i) a default in the payment of
all or any portion of any Senior Indebtedness and the Trustee has received
written notice thereof from the Company, from holders of Senior Indebtedness or
from any trustee, representative or agent therefor, or (ii) any other default
affecting Senior Indebtedness, as a result of which the maturity of Senior
Indebtedness has been accelerated and the Trustee has received written notice
from the Company, from holders of Senior Indebtedness or from any trustee,
representative or agent therefor, and such default shall not have been cured or
waived by or on behalf of the holders of such Senior Indebtedness.
(c) If, notwithstanding the foregoing provisions prohibiting such payment
or distribution, the Trustee or any Holder shall have received any payment on
account of the principal of or premium, if any, or interest on the Debentures
when such payment is prohibited by this Section 10.02 and before all amounts
payable on, under or in connection with Senior Indebtedness are paid in full in
cash or cash equivalents, then and in such event (subject to the provisions of
Section 10.08 hereof) such payment or distribution shall be received and held in
trust for the holders of Senior Indebtedness and, at the written direction of
the trustee, representative or agent for the holders of the Senior Indebtedness,
shall be paid to the holders of the Senior Indebtedness remaining unpaid to the
extent necessary to pay such Senior Indebtedness in full in cash or cash
equivalents.
Upon any payment or distribution of assets or securities referred to in
this Article 10, the Trustee and the Holders shall be entitled to rely upon any
order or decree of a court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending, and upon a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making any such payment or distribution, delivered to the
Trustee for the purpose of ascertaining the Persons entitled to participate in
such distribution, the holders of Senior Indebtedness of the Company, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article 10.
10.03 Payments which May Be Made Prior to Notice.
Nothing in this Article 10 or elsewhere in this Indenture shall prevent
(i) the Company, except under the conditions described in Section 10.02 hereof,
from making payments of principal of or premium, if any, or interest on the
Debentures or from depositing with the Trustee any monies for such payments, or
(ii) the application by the Trustee of any monies deposited with it for the
purpose of making such payments of principal of or premium, if any, or interest
on the Debentures, to the Holders entitled thereto, unless at least one Business
Day prior to the date when such payment would otherwise (except for the
prohibitions contained in Section
41
10.02 hereof) become due and payable the Trustee shall have received the written
notice provided for in Section 10.02(b)(i) or (ii) hereof.
10.04 Rights of Holders of Senior Indebtedness Not to Be Impaired.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time or in any way be
prejudiced or impaired by any act or failure to act in good faith by any such
holder, or by any noncompliance by the Company with the terms and provisions and
covenants herein regardless of any knowledge thereof any such holder may have or
otherwise be charged with.
The provisions of this Article 10 are intended to be for the benefit of,
and shall be enforceable directly by, the holders of Senior Indebtedness.
Notwithstanding anything to the contrary in this Article 10, to the extent any
Holders or the Trustee have paid over or delivered to any holder of Senior
Indebtedness any payment or distribution received on account of the principal of
or premium (if any) or interest on the Debentures to which any other holder of
Senior Indebtedness shall be entitled to share in accordance with Section 10.02
hereof, no holder of Senior Indebtedness shall have a claim or right against any
Holders or the Trustee with respect to any such payment or distribution or as a
result of the failure to make payments or distributions to such other holder of
Senior Indebtedness.
10.05 Trustee May Take Action to Effectuate Subordination.
Each Holder of a Debenture, by his acceptance thereof, authorizes and
directs the Trustee on his behalf to take such action as may be required by the
trustee, representative or agent for holders of Senior Indebtedness or by the
Company to effectuate, as between the holders of Senior Indebtedness and the
Holders, the subordination as provided in this Article 10 and appoints the
Trustee his attorney-in-fact for any and all such purposes.
10.06 Subrogation.
Upon the payment in full, in cash or cash equivalents, of all Senior
Indebtedness, any Holder shall be subrogated to the rights of the holders of
such Senior Indebtedness to receive payments or distributions of assets of the
Company made on such Senior Indebtedness until the Debentures shall be paid in
full; and for the purposes of such subrogation, no payments or distributions to
holders of such Senior Indebtedness of any cash property or securities to which
such Holders of the Debentures would be entitled except for this Article 10, and
no payment pursuant to this Article 10 to holders of such Senior Indebtedness by
such Holders of the Debentures, shall, as between the Company, its creditors
other than holders of such Senior Indebtedness and such Holders of the
Debentures, be deemed to be a payment by the Company to or on account of such
Senior Indebtedness, it being understood that the provisions of this Article 10
are solely for the purpose of defining the relative rights of the holders of
such Senior Indebtedness, on the one hand, and such Holders of the Debentures,
on the other hand.
If any payment or distribution to which Holders of Debentures would
otherwise have been entitled but for the provisions of this Article 10 shall
have been applied, pursuant to this Article 10, to the payment of all Senior
Indebtedness then and in such case such Holders of
42
the Debentures shall be entitled to receive from the holders of such Senior
Indebtedness at the time outstanding any payments or distributions received by
such holders of Senior Indebtedness in excess of the amount sufficient to pay,
in cash or cash equivalents, all such Senior Indebtedness in full.
10.07 Obligations of Company Unconditional: Reinstatement.
Nothing in this Article 10 or elsewhere in this Indenture or in any
Debenture is intended to or shall impair, as between the Company and Holders of
the Debentures, the obligations of the Company, which are absolute and
unconditional, to pay to such Holders the principal of and premium, if any, and
interest on the Debentures as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of such Holders of the Debentures and creditors of the Company other than
the holders of the Senior Indebtedness, nor shall anything herein or therein
prevent the Trustee or any Holder of Debentures or holder of Preferred
Securities, as applicable, from exercising all remedies otherwise permitted by
applicable law under this Indenture, subject to the rights, if any, under this
Article 10 of the holders of such Senior Indebtedness in respect of cash,
property or securities of the Company received upon the exercise of any such
remedy.
The failure to make a scheduled payment of principal of or premium, if
any, or interest on the Debentures by reason of Section 10.02 shall not be
construed as preventing the occurrence of an Event of Default under Section 6.01
hereof; provided, however, that if (i) the conditions preventing the making of
such payment no longer exist, and (ii) such Holders of the Debentures are made
whole with respect to such omitted payments, the Event of Default relating
thereto (including any failure to pay any accelerated amounts) shall be
automatically waived, and the provisions of the Indenture shall be reinstated as
if no such Event of Default had occurred.
10.08 Trustee Entitled to Assume Payments Not Prohibited in Absence of
Notice.
The Trustee or Paying Agent shall not be charged with the knowledge of the
existence of any default in the payment of all or a portion of any Senior
Indebtedness or any other default affecting Senior Indebtedness, as a result of
which the maturity of the Senior Indebtedness has been accelerated, unless and
until the Trustee or Paying Agent shall have received written notice thereof
from the Company or one or more holders of Senior Indebtedness or from any
trustee, representative or agent therefor or unless the Trustee or Paying Agent
otherwise had actual knowledge thereof; and, prior to the receipt of any such
written notice or actual knowledge of a Responsible Officer in the Corporate
Trust Department of the Trustee or Paying Agent, the Trustee or Paying Agent may
conclusively assume that no such facts exist.
Unless at least one Business Day prior to the date when by the terms of
this Indenture any monies are to be deposited by the Company with the Trustee or
any Paying Agent for any purpose (including, without limitation, the payment of
the principal of or premium, if any, or interest on any Debenture), the Trustee
or Paying Agent shall have received with respect to such monies the notice
provided for in Section 10.02 or a Responsible Officer in the Corporate Trust
Department of the Trustee or Paying Agent shall have actual knowledge of default
in the payment of all or a portion of any Senior Indebtedness or any other
default affecting Senior
43
Indebtedness as the result of which the maturity of the Senior Indebtedness has
been accelerated, the Trustee or Paying Agent shall have full power and
authority to receive and apply such monies to the purpose for which they were
received. Neither of them shall be affected by any notice to the contrary, which
may be received by either on or after such date. The foregoing shall not apply
to the Paying Agent if the Company is acting as Paying Agent. Nothing in this
Section 10.08 shall limit the right of the holders of Senior Indebtedness to
recover payments as contemplated by Section 10.02 hereof. The Trustee or Paying
Agent shall be entitled to conclusively rely on the delivery to it of a written
notice by a Person representing himself or itself to be a holder of such Senior
Indebtedness (or a trustee, representative or agent on behalf of such holder) to
establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee, representative or agent on behalf of any such holder.
The Trustee shall not be deemed to have any duty to the holders (and shall be
fully protected in relying upon such notice) of Senior Indebtedness.
10.09 Right of Trustee to Hold Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all of the rights
set forth in this Article 10 in respect of any Senior Indebtedness at any time
held by them to the same extent as any other holder of such Senior Indebtedness,
and nothing in this Indenture shall be construed to deprive the Trustee or any
Paying Agent of any of its rights as such holder.
ARTICLE 11
MISCELLANEOUS
11.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by operation of subsection (c) of Section 318 of the TIA, the
imposed duties shall control. The provisions of Sections 310 to 317, inclusive,
of the TIA that impose duties on any Person (including provisions automatically
deemed included in an indenture unless the indenture provides that such
provisions are excluded) are a part of and govern this Indenture, except as, and
to the extent, they are expressly excluded from this Indenture, as permitted by
the TIA.
11.02 Notices.
Any notice, request or other communication required or permitted to be
given hereunder shall be in writing and delivered, telecopied or mailed by
first-class mail, postage prepaid, addressed as follows:
if to the Company:
Public Service Enterprise Group Incorporated
00 Xxxx Xxxxx, X0X
P.O. Box 1171
Newark, New Jersey 07101-1171
Facsimile No.: (000) 000-0000
Attention: Treasurer
44
if to the Trustee:
Wachovia Bank, National Association
00 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Facsimile No. (000) 000-0000
Attention: Corporate Trust Department
The Company or the Trustee, by giving notice to the other, may designate
additional or different addresses for subsequent notices of communications. The
Company shall notify the holder, if any, of Senior Indebtedness of any such
additional or different addresses of which the Company receives notice from the
Trustee.
Any notice or communication given to a Debentureholder shall be mailed or
delivered to the Debentureholder at the Debentureholder's address as it appears
on the Register of the Registrar and shall be sufficiently given if mailed
within the time prescribed.
Failure to mail a notice or communication to a Debentureholder or any
defect in it shall not affect its sufficiency with respect to other
Debentureholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the Debentureholders, it
shall mail a copy to the Trustee and each Registrar, Paying Agent or
co-Registrar.
11.03 Communication by Holders with Other Holders.
Debentureholders may communicate, pursuant to TIA Section 312(b), with
other Debentureholders with respect to their rights under this Indenture or the
Debentures. The Company, the Trustee, the Registrar, the Paying Agent and anyone
else shall have the protection of TIA Section 312(c).
11.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officer's Certificate (complying with Section 11.05 hereof) stating
that, in the opinion of such Officer, all conditions precedent to the taking of
such action have been complied with; and
(2) if appropriate, an Opinion of Counsel (complying with Section 11.05
hereof) stating that, in the opinion of such counsel all such conditions
precedent to the taking of such action have been complied with.
45
11.05 Statements Required in Certificate or Opinion.
Each Officer's Certificate and Opinion of Counsel with respect to
compliance with a covenant or condition provided for in this Indenture shall
include:
(1) a statement that each Person making such Officer's Certificate or
Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such Officer's
Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such Person, such Person has
made such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement that, in the opinion of such Person, such covenant or
condition has been complied with; provided, however, that with respect to
matters of fact not involving any legal conclusion, an Opinion of Counsel may
rely on an Officer's Certificate or certificates of public officials.
11.06 Severability Clause.
If any provision in this Indenture or in the Debentures shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
11.07 Rules by Trustee, Paying Agent and Registrar.
The Trustee may make reasonable rules for action by or a meeting of
Debentureholders. The Registrar and Paying Agent may make reasonable rules for
their functions.
11.08 Legal Holidays.
A "Legal Holiday" is any day other than a Business Day. If any specified
date (including a date for giving notice) is a Legal Holiday, the action to be
taken on such date shall be taken on the next succeeding day that is not a Legal
Holiday, and if such action is a payment in respect of the Debentures, unless
otherwise specified pursuant to Section 2.01 hereof no principal, premium (if
any) or interest installment shall accrue for the intervening period; except
that if any interest payment is due on a Legal Holiday and the next succeeding
day is in the next succeeding calendar year, such payment shall be made on the
Business Day immediately preceding such Legal Holiday.
46
11.09 Governing Law.
This Indenture and the Debentures shall be governed by and construed in
accordance with the laws of the State of New Jersey as applied to contracts made
and performed within the State of New Jersey, without regard to its principles
of conflicts of laws.
11.10 No Recourse Against Others.
No director, officer, employee or stockholder, as such, of the Company
shall have any liability for any obligations of the Company under the Debentures
or this Indenture or for any claim based on, in respect of or by reason of such
obligations their creation. By accepting a Debenture, each Debentureholder shall
waive and release all such liability. The waiver and release shall be part of
the consideration for the issue of the Debentures.
11.11 Successors.
All agreements of the Company in this Indenture and Debentures shall bind
its successors and assigns. All agreements of the Trustee in this Indenture
shall bind its successors and assigns.
11.12 Multiple Original Copies of this Indenture.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement. Any signed copy shall be sufficient proof of this Indenture.
11.13 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any subsidiary. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
11.14 Table of Contents: Headings, Etc.
The Table of Contents, Cross-Reference Table, and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
11.15 Benefits of the Indenture.
Except as otherwise expressly provided herein with respect to holders of
Senior Indebtedness and holders of Preferred Securities, nothing in this
Indenture or in the Debentures, express or implied, shall give to any person,
other than the parties hereto and their successors hereunder and the Holders of
the Debentures, any benefit or any legal or equitable right, remedy or claim
under this Indenture.
47
SIGNATURES
IN WITNESS WHEREOF, the undersigned, being duly authorized, have executed
this Indenture on behalf of the respective parties hereto as of the date first
above written.
PUBLIC SERVICE ENTERPRISE GROUP
INCORPORATED
By:
-------------------------------------
Name:
Title:
WACHOVIA BANK, NATIONAL
ASSOCIATION,
as Trustee
By:
-------------------------------------
Name:
Title:
48
Exhibit A
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
8.75% Deferrable Interest Junior Subordinated Debenture,
Series D
No. R-1
Public Service Enterprise Group Incorporated, a New Jersey corporation
(the "Company", which term includes any successor company under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
____________________ or registered assigns, the principal sum of $185,567,025
Dollars on December 31, 2032, and to pay interest on said principal sum from
December 17, 2002 or from the most recent Interest Payment Date (as defined
below) to which interest has been paid or duly provided for, in arrears on March
31, June 30, September 30 and December 31, commencing March 31, 2003 (each, an
"Interest Payment Date") at a rate equal to 8.75% until the principal hereof
shall have become due and payable, and on any overdue principal and (to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum. In the event that
any Interest Payment Date is not a Business Day, then interest will be payable
on the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Debenture is registered at
the close of business on the Regular Record Date for such interest installment,
which shall be the 15th day (whether or not a Business Day) preceding the
applicable Interest Payment Date, provided that if all of the Series D
Debentures (as defined below) are then held by PSEG Funding Trust II (the
"Trust") or the Series D Debentures are held in book-entry-only form, the
Regular Record Date shall be the close of business on the Business Day next
preceding such Interest Payment Date. Any such interest installment not
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such Regular Record Date, and may be paid to the Person in whose name
this Debenture is registered at the close of business on a Special Record Date
to be fixed by the Trustee (as defined below) for the payment of such defaulted
interest, notice whereof shall be given to the Holders of the Series D
Debentures not less than 7 days prior to such Special Record Date, as more fully
provided in the Indenture.
Payment of the principal of, premium, if any, and interest on this
Debenture will be made in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts. Payments of interest on an Interest Payment Date will be made by check
mailed to the Holder hereof at the address shown in the Register or, at the
option of the Holder hereof, to such other place in the United States of America
as the Holder hereof shall designate to the Trustee in writing. At the request
of a Holder of at least $10,000,000 aggregate principal amount of Series D
Debentures, interest on such Debentures will be payable by wire transfer within
the continental United States in immediately available
A-1
funds to the bank account number specified in writing by such Holder to the
Registrar prior to the Regular Record Date.
The principal and any premium and interest due hereon on the Stated
Maturity Date or a Redemption Date (other than an Interest Payment Date) will be
paid in immediately available funds only upon surrender of this Debenture at the
principal corporate office of Wachovia Bank, National Association, Paying Agent,
in Morristown, New Jersey, or at such other office or agency of the Paying Agent
as the Company shall designate by written notice to the Holder of this
Debenture.
The indebtedness evidenced by this Debenture is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Debenture is issued subject to the
provisions of the Indenture with respect thereto. The Holder of this Debenture,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. The Holder of this Debenture, by his acceptance hereof, hereby waives
all notice of the acceptance of the subordination provisions contained herein
and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
This Debenture is one of a duly authorized series of Junior Subordinated
Debentures of the Company (herein sometimes referred to as the "Series D
Debentures"), specified in the Indenture, limited in aggregate principal amount
to $185,567,025, issued under and pursuant to an Indenture dated as of December
17, 2002 (the "Indenture") executed and delivered between the Company and
Wachovia Bank, National Association, as trustee (the "Trustee"). The Series D
Debentures are initially being issued to the Trust, to be held on behalf of the
Trust by its property trustee (the "Property Trustee"). Concurrently with the
issuance of the Series D Debentures, the Trust is issuing its trust securities,
representing undivided beneficial interests in the assets of the Trust and
having an aggregate liquidation amount equal to the principal amount of the
Series D Debentures, including the Trust's 8.75% Trust Preferred Securities,
(the "Preferred Securities"). By the terms of the Indenture, Debentures are
issuable in series which may vary as to amount, date of maturity, rate of
interest and in other respects as in the Indenture provided. Reference is made
to the Indenture for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
Holders of the Debentures. Each term used in this Debenture which is defined in
the Indenture and not defined herein shall have the meaning assigned to it in
the Indenture.
In the event that the Property Trustee is the holder of all of the
outstanding Debentures, the Company shall pay to the Trust (and any permitted
successor or assign under the Trust II Agreement (as such term is defined in the
Indenture)) for so long as the Trust (or its permitted successor or assignee) is
the registered holder of any Debentures, such additional amounts as may be
necessary in order that the amount of distributions then due and payable by the
Trust on the related Preferred Securities and Common Securities (the "Common
Securities") of the Trust that at any time remain outstanding in accordance with
the terms thereof shall not be
A-2
reduced as a result of any taxes, duties, assessments and governmental charges
of whatever nature imposed by the United States or any other taxing authority to
which the Trust has become subject (but not including withholding taxes imposed
on holders of such Preferred Securities and Common Securities) (the "Additional
Interest"). Whenever in the Indenture or the Debentures there is a reference in
any context to the payment of principal of or interest on the Debentures, such
reference shall be deemed to include payment of the Additional Interest provided
for in this paragraph to the extent that, in such context, Additional Interest
is, were or would be payable in respect thereof pursuant to the provisions of
this paragraph and express reference to the payment of Additional Interest (if
applicable) in any provisions hereof shall not be construed as excluding
Additional Interest in those provisions hereof where such express reference is
not made.
At the option of the Company, the Series D Debentures are redeemable prior
to maturity (i) at any time on or after December 17, 2007, in whole or in part,
and (ii) within 90 days following the occurrence and continuance of a Special
Event, in whole (but not in part), in either case, at a price equal to 100% of
the principal amount of the Series D Debentures to be redeemed plus accrued
interest to the Redemption Date. A "Special Event" shall mean either a "Tax
Event" or an "Investment Company Event." "Tax Event" shall mean that the Company
shall have received an opinion of counsel (which may be regular counsel to the
Company or an Affiliate, but not an employee thereof and which must be
acceptable to the Property Trustee of the Trust) experienced in such matters to
the effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such interpretation or
pronouncement is announced on or after the date of original issuance of
Preferred Securities, there is more than an insubstantial risk that (i) the
Trust is, or will be, subject to United States Federal income tax with respect
to interest received on the Debentures, (ii) interest payable by the Company to
the Trust on the Series D Debentures is not, or will not be, deductible for
United States Federal income tax purposes or (iii) the Trust is, or will be,
subject to more than a de minimis amount of other taxes, duties, assessments or
other governmental charges. "Investment Company Event" shall mean the occurrence
of a change in law or regulation or a change in interpretation or application of
law or regulation by any legislative body, court, governmental agency or
regulatory authority (a "Change in 1940 Act Law") to the effect that the Trust
is or will be considered an "investment company" that is required to be
registered under the Investment Company Act of 1940, as amended, which Change in
1940 Act Law becomes effective on or after the date of original issuance of the
Preferred Securities.
At least 30 days but not more than 60 days before the Redemption Date, the
Trustee shall mail or caused to be mailed a notice of redemption by first-class
mail, postage prepaid, to each Holder of Series D Debentures to be redeemed.
In the event of redemption of this Debenture in part only, a new Series D
Debenture or Debentures for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the cancellation hereof.
A-3
In case an Event of Default with respect to the Series D Debentures occurs
and is continuing, the principal of and premium, if any, and interest on the
Series D Debentures may (and, in certain circumstances, shall) be declared, and
upon such declaration shall become, due and payable, in the manner, with the
effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Debenture upon compliance by the Company with certain
conditions set forth therein.
Subject to certain exceptions in the Indenture which require the consent
of every Holder, the Company and the Trustee may amend the Indenture or may
waive future compliance by the Company with any provisions of the Indenture,
with the consent of the Holders of at least a majority in aggregate principal
amount of the Debentures of each series affected thereby, provided that if the
Series D Debentures are held by the Trust, no such amendment or waiver that
adversely affects the holders of the Preferred Securities shall be effective
without the prior consent of the holders of at least a majority in aggregate
liquidation amount of the outstanding Preferred Securities. Subject to certain
exceptions in the Indenture, without the consent of any Debentureholder, the
Company and the Trustee may amend the Indenture to cure any ambiguity, defect or
inconsistency, to bind a successor to the obligations of the Indenture, to
provide for uncertificated Debentures in addition to certificated Debentures, to
comply with any requirements of the Debentures and the Securities and Exchange
Commission in connection with the qualification of the Indenture under the TIA,
or to make any change that, in the reasonable judgment of the Company, does not
adversely affect the rights of any Debentureholder. Amendments bind all Holders
and subsequent Holders.
No reference herein to the Indenture and no provision of this Debenture or
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and premium, if any, and
interest on this Debenture at the time and place and at the rate and in the
money herein prescribed.
So long as no Event of Default with respect to the Series D Debentures has
occurred and is continuing, the Company shall have the right at any time and
from time to time to extend the interest payment period of the Series D
Debentures for up to 20 consecutive quarterly distribution periods (the
"Extension Period"), provided that no Extension Period shall extend beyond the
Stated Maturity Date or Redemption Date of any Series D Debenture. At the end of
the Extension Period, the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Series D
Debentures, compounded quarterly, to the extent that payment of such interest is
enforceable under applicable law). Prior to the termination of any such
Extension Period, the Company may further extend such Extension Period, provided
that such Extension Period, together with all such previous and further
extensions, shall not exceed 20 consecutive quarterly distribution periods and
shall not extend beyond the Stated Maturity Date or Redemption Date of any
Series D Debenture. At the termination of any such Extension Period and upon the
payment of all amounts then due, the Company may elect to begin a new Extension
Period, subject to the foregoing restrictions.
A-4
Series D Debentures are issuable only in registered form without coupons
in denominations of $25 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, this Debenture
is exchangeable for a like aggregate principal amount of Series D Debentures of
a different authorized denomination, as requested by the Holder surrendering the
same.
As provided in the Indenture and subject to certain limitations therein
set forth, this Debenture is transferable by the Holder hereof upon surrender of
this Debenture for registration of transfer at the office or agency of the
Registrar accompanied by a written instrument or instruments of transfer inform
satisfactory to the Registrar duly executed by the Holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Series D Debentures of
authorized denominations and for the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to presentment for registration of transfer of this Debenture, the
Company, the Trustee, any Paying Agent and any Registrar may deem and treat the
Holder hereof as the absolute owner hereof (whether or not this Debenture shall
be overdue and notwithstanding any notice of ownership or writing hereon made by
anyone other than the Registrar) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and interest due hereon and
for all other purposes, and neither the Company nor the Trustee nor any Paying
Agent nor any Registrar shall be affected by any notice to the contrary.
The Company agrees, and by acceptance of a beneficial ownership interest
in the Series D Debentures, each beneficial owner of the Series D Debentures
will be deemed to have agreed, to treat the Series D Debentures as indebtedness
of the Company for United States federal income tax purposes.
No recourse shall be had for the payment of the principal of or the
interest on this Debenture, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder officer or director, past, present or future, as such,
of the Company or of any predecessor or successor corporation, whether by virtue
of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
This Debenture shall not be valid until an authorized signatory of the
Trustee manually signs and dates the Trustee's Certificate of Authentication
below.
A-5
IN WITNESS WHEREOF, the Company has caused this Debenture to be signed
manually or by facsimile by its duly authorized officers and a facsimile of its
corporate seal to be affixed hereto or imprinted hereon.
PUBLIC SERVICE ENTERPRISE
GROUP INCORPORATED
By:
-------------------------------------
[SEAL] Name:
Title:
Attest:
--------------------------
(Assistant) Secretary
A-6
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures, of the series designated, referred to in
the within-mentioned Indenture.
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Trustee
By:
-------------------------------------
Authorized Signatory
Dated: December 17, 2002
A-7
ASSIGNMENT FORM
To assign this Debenture, fill in the form below: (I) or (we) assign and
transfer this Debenture to:
________________________________________________________________________________
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________ agent to transfer this Debenture on
the books of the Register. The agent may substitute another to act for him.
Dated: _______________ Signature:
------------------------------
(Sign exactly as your name
appears on the other side of
this Debenture)
Signature Guaranty: ____________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Trustee, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP:) or such
other "signature guarantee program" as may be determined by the Trustee in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-8
