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EXHIBIT 4(e)
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CMS ENERGY CORPORATION
and
THE BANK OF NEW YORK
as Trustee
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7 1/4% Subordinated Deferrable Notes due 2004
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FOURTH SUPPLEMENTAL INDENTURE
Dated as of August 22, 2000
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Table of Contents
Page
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ARTICLE I DEFINITIONS..............................................................................2
Section 1.1 Definition of Terms......................................................2
ARTICLE II TERMS AND ISSUANCE OF THE SUBORDINATED NOTES............................................4
Section 2.1 Issue of Subordinated Notes..............................................4
Section 2.2 Maturity.................................................................4
Section 2.3 Global Subordinated Notes................................................5
Section 2.4 Interest.................................................................6
Section 2.5 Redemption...............................................................6
Section 2.6 Events of Default.......................................................10
Section 2.7 Paying Agent; Security Registrar........................................10
Section 2.8 Extension of Interest Payment Period....................................10
Section 2.9 Notice of Extension.....................................................11
Section 2.10 Place of Payment........................................................12
ARTICLE III EXPENSES..............................................................................12
Section 3.1 Payment of Expenses.....................................................12
ARTICLE IV COVENANTS..............................................................................13
Section 4.1 Covenants in the Event of an Event of Default...........................13
Section 4.2 Additional Covenants Relating to the Trust..............................13
ARTICLE V ORIGINAL ISSUE OF SUBORDINATED NOTES....................................................14
Section 5.1 Original Issue of Subordinated Notes....................................14
ARTICLE VI RIGHTS OF HOLDERS OF PREFERRED SECURITIES..............................................15
Section 6.1 Preferred Security Holders' Rights......................................15
Section 6.2 Direct Action...........................................................15
Section 6.3 Payments Pursuant to Direct Actions.....................................15
Section 6.4 Modifications...........................................................15
ARTICLE VII REMARKETING...........................................................................16
Section 7.1 Effectiveness of this Article...........................................16
ARTICLE VIII ACCELERATION OF MATURITY.............................................................16
Section 8.1 Automatic Acceleration..................................................16
ARTICLE IX MISCELLANEOUS..........................................................................16
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Section 9.1 Execution of Fourth Supplemental Indenture..............................16
Section 9.2 Conflict with Trust Indenture Act.......................................16
Section 9.3 Effect of Headings......................................................17
Section 9.4 Successors and Assigns..................................................17
Section 9.5 Separability Clause.....................................................17
Section 9.6 Benefits of Fourth Supplemental Indenture...............................17
Section 9.7 Governing Law...........................................................17
EXHIBIT A
[FORM OF FACE OF SUBORDINATED DEFERRABLE NOTE]....................................................A-1
EXHIBIT B
[FORM OF FACE OF SUBORDINATED DEFERRABLE NOTE]....................................................B-1
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THIS FOURTH SUPPLEMENTAL INDENTURE, dated as of August 22, 2000,
(herein called the "Fourth Supplemental Indenture"), between CMS Energy
Corporation, a corporation duly organized and existing under the laws of the
State of Michigan (hereinafter called the "Company"), party of the first part,
and The Bank of New York, a New York banking corporation, as Trustee under the
Indenture referred to below (hereinafter called the "Trustee"), party of the
second part.
WITNESSETH:
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an Indenture, dated as of June 1, 1997 (hereinafter called the
"Indenture"), to provide for the issuance from time to time of certain of its
unsecured notes (hereinafter called the "Securities"), the form and terms of
which are to be established as set forth in Sections 2.1 and 2.3 of the
Indenture; and
WHEREAS, Section 8.1 of the Indenture provides, among other things,
that the Company and the Trustee may enter into indentures supplemental to the
Indenture for, among other things, the purpose of establishing the form or terms
of the Securities of any series as permitted in Sections 2.1 and 2.3 of the
Indenture; and
WHEREAS, the Company desires to create a series of the Securities
in an aggregate principal amount of up to $257,731,975 to be designated the "7
1/4% Subordinated Deferrable Notes due 2004" (the "Subordinated Notes"), and all
action on the part of the Company necessary to authorize the issuance of the
Subordinated Notes under the Indenture and this Fourth Supplemental Indenture
has been duly taken; and
WHEREAS, all acts and things necessary to make the Subordinated
Notes when executed by the Company and completed, authenticated and delivered by
the Trustee as in the Indenture and this Fourth Supplemental Indenture provided,
the valid and binding obligations of the Company and to constitute these
presents a valid and legally binding supplemental indenture and agreement
according to its terms, have been done and performed; and
WHEREAS, Section 8.1 of the Indenture provides, among other things,
that the Company and the Trustee may enter into indentures supplemental to the
Indenture to, among other things, add to the covenants of the Company for the
benefit of the Holders of all or any series of Securities; and
WHEREAS, CMS Energy Trust III, a Delaware statutory business trust
(the "Trust"), has offered to the public up to $250,000,000 in aggregate
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liquidation amount of its 7 1/4% Trust Preferred Securities (the "Preferred
Securities") and, in connection therewith, the Company has agreed to purchase up
to $7,731,975 in value of the aggregate liquidation amount of the Trust's common
securities (the "Common Securities" and together with the Preferred Securities,
the "Trust Securities"), each representing an undivided beneficial interest in
the assets of the Trust, and proposes to invest the proceeds from such offerings
in up to $257,731,975 aggregate principal amount of the Subordinated Notes;
NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH:
That in consideration of the premises, the Company covenants and
agrees with the Trustee, for the equal benefit of holders of the Subordinated
Notes, as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definition of Terms. Unless the context otherwise
requires:
(a) a term not defined herein that is defined in the
Indenture has the same meaning when used in this Fourth Supplemental Indenture;
(b) a term defined anywhere in this Fourth Supplemental
Indenture has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or
Article of this Fourth Supplemental Indenture;
(e) headings are for convenience of reference only and do
not affect interpretation;
(f) the following terms have the meanings given to them in
the Declaration: (i) Applicable Margin; (ii) Applicable Principal Amount; (iii)
Cash Merger Event Payment; (iv) Cash Merger Redemption; (v) Cash Merger
Redemption Date; (vi) Common Securities; (vii) Delaware Trustee; (viii) Failed
Remarketing; (ix) Guarantee; (x) Majority in Liquidation Amount; (xi) Preferred
Securities; (xii) Preferred Security Certificate; (xiii) Property Trustee; (xiv)
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Redemption Amount; (xv) Redemption Price; (xvi) Regular Trustees; (xvii)
Remarketing Agreement; (xviii) Tax Event; (xix) Remarketing Date; (xx) Reset
Rate; (xxi) Tax Event Redemption; (xxii) Treasury Portfolio; and (xxiii)
Two-Year Benchmark Treasury Rate;
(g) the following terms have the meanings given to them in
the Purchase Contract Agreement: (i) Cash Merger Early Settlement; (ii) Cash
Merger Event; (iii) Cash Settlement; (iv) Early Settlement Week; (v) PEPS Units;
(vi) Pledge Agreement; (vii) Purchase Contract and (viii) Purchase Contract
Settlement Date; (ix) Treasury PEPS Unit; (x) Global Certificate;
(h) the following terms have the meanings given to them in
this Section 1.1(h):
"Business Day" means a day on which banking institutions in
New York, New York or Delaware are not authorized or required by
law to close.
"Declaration" means the Amended and Restated Declaration of
Trust of the Trust, dated as of August 22, 2000, as amended and
restated from time to time.
"Direct Action" has the meaning specified in Section 6.2.
"Primary Treasury Dealer" means a primary U.S. government
securities dealer in New York City.
"Purchase Contract Agreement" means the Purchase Contract
Agreement dated as of August 22, 2000 between the Company and The
Bank of New York, as Purchase Contract Agent.
"Quotation Agent" means (i) Xxxxxx Xxxxxxx & Co. Incorporated
and its respective successors, provided that if Xxxxxx Xxxxxxx &
Co. Incorporated ceases to be a Primary Treasury Dealer, the
Company will substitute another Primary Treasury Dealer therefor,
or (ii) any other Primary Treasury Dealer selected by the Company.
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"Remarketing" means (i) as long as the Trust has not been
liquidated, the operation of the procedures for remarketing
specified in Section 7.13 of the Declaration and (ii) if the Trust
has been liquidated, the operation of the procedures for
remarketing specified in Section 5.02 of the Purchase Contract
Agreement.
"Remarketing Agent" shall mean Xxxxxx Xxxxxxx & Co.
Incorporated or any successor remarketing agent selected by the
Company.
ARTICLE II
TERMS AND ISSUANCE OF THE SUBORDINATED NOTES
Section 2.1 Issue of Subordinated Notes. A series of Securities
which shall be designated the "7 1/4% Subordinated Deferrable Notes due 2004"
shall be executed, authenticated and delivered in accordance with the provisions
of, and shall in all respects be subject to, the terms, conditions and covenants
of the Indenture and this Fourth Supplemental Indenture (including the form of
Subordinated Note set forth as Exhibits A and B hereto). The aggregate principal
amount of Subordinated Notes of the series created hereby which may be
authenticated and delivered under the Indenture shall not, except as permitted
by the provisions of the Indenture, exceed $257,731,975. The Subordinated Notes
shall be initially issued in certificated form to the Trust (the "Initial
Subordinated Notes") and shall be substantially in the Form of Exhibit B
attached hereto. The terms of such Subordinated Notes are herein incorporated by
reference and are part of the Fourth Supplemental Indenture.
Section 2.2 Maturity. Unless a Tax Event Redemption or Cash
Merger Early Redemption occurs, the entire principal amount of the Subordinated
Notes will mature and become due and payable together with any accrued and
unpaid interest thereon, on August 18, 2004 (the "Maturity Date").
Section 2.3 Global Subordinated Notes. If distributed to
holders of Preferred Securities in connection with the involuntary or voluntary
liquidation and dissolution of the Trust:
(a) If the Preferred Securities are held in book-entry form,
the Initial Subordinated Notes may be presented to the Trustee by the Property
Trustee in exchange for a Global Security in the form of Exhibit A in an
aggregate principal amount equal to all Outstanding Subordinated Notes (a
"Global
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Subordinated Note"). The Depositary for the Global Subordinated Note will be The
Depository Trust Company. The Global Subordinated Note will be registered in the
name of the Depositary or its nominee, Cede & Co., and delivered by the Trustee
to the Depositary or a custodian appointed by the Depositary for crediting to
the accounts of its participants pursuant to the instructions of the Property
Trustee. The Company upon any such presentation shall execute a Global
Subordinated Note in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with the Indenture and
this Fourth Supplemental Indenture. Payments on the Subordinated Notes issued as
a Global Subordinated Note will be made to the Depositary or its nominee.
(b) If any Preferred Securities are held in non book-entry
certificated form ("Non Book-Entry Preferred Securities"), the Initial
Subordinated Notes may be presented to the Trustee by the Property Trustee, and
such Non Book-Entry Preferred Securities will be deemed to represent beneficial
interests in Subordinated Notes presented to the Trustee by the Property Trustee
having an aggregate principal amount equal to the aggregate liquidation amount
of the Non Book-Entry Preferred Securities until the Preferred Security
Certificates representing such Non Book-Entry Preferred Securities are presented
to the Security Registrar for transfer or reissuance, at which time such
Preferred Security Certificates will be canceled and a Subordinated Note
registered in the name of the holder of the Preferred Security Certificate or
the transferee of the holder of such Preferred Security Certificate, as the case
may be, with an aggregate principal amount equal to the aggregate liquidation
amount of the Preferred Security Certificate canceled will be executed by the
Company and delivered to the Trustee for authentication and delivery in
accordance with the Indenture and this Fourth Supplemental Indenture. On issue
of such Subordinated Notes, Subordinated Notes with an equivalent aggregate
principal amount that were presented by the Property Trustee to the Trustee will
be deemed to have been canceled.
Section 2.4 Interest. (a) Each Subordinated Note will bear
interest at the rate of 7.25% per annum from August 22, 2000 until the Purchase
Contract Settlement Date, and at the Reset Rate thereafter, payable quarterly in
arrears on August 18, November 18, February 18 and May 18 of each year,
commencing November 18, 2000 (the "Interest Payment Dates").
(b) The Regular Record Dates for the payment of interest on
the Subordinated Notes on any Interest Payment Date, shall be (i) as long as the
Subordinated Notes are represented by a Global Subordinated Note or the Initial
Subordinated Notes, the Business Day preceding each Interest Payment Date or
(ii) if
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the Subordinated Notes are issued pursuant to Section 2.3(b) above, the
fifteenth Business Day prior to each Interest Payment Date.
(c) The interest rate on the Subordinated Notes outstanding
on and after the Remarketing Date will be reset to the Reset Rate. The Reset
Rate will be equal to the rate per annum that results from the Remarketing,
provided that if a Failed Remarketing occurs, the Reset Rate will be equal to
(i) the Two-Year Benchmark Treasury Rate plus (ii) the Applicable Margin.
(d) The amount of interest payable on the Subordinated Notes
for any period will be computed (i) for any full quarterly period on the basis
of a 360-day year of twelve 30-day months and (ii) for any period shorter than a
full quarterly period, on the basis of a 30-day month and, for any period less
than a month, on the basis of the actual number of days elapsed per 30-day
month. In the event that any date on which interest is payable on the
Subordinated Notes is not a Business Day, then payment of the interest payable
on such date will be made on the next day that is a Business Day (and without
interest or other payment in respect of any such delay), except that, if such
Business Day is in the next calendar year, then such payment will be made on the
preceding Business Day.
Section 2.5 Redemption. (a) If a Tax Event occurs and is
continuing, the Company may, at its option and upon not less than 30 nor more
than 60 days' notice to the Holders of the Subordinated Notes, redeem the
Subordinated Notes in whole (but not in part) within 90 days following the
occurrence of such Tax Event, at a price equal to, for each Subordinated Note,
the applicable Redemption Price. The aggregate Redemption Price shall be paid
prior to 12:00 noon, New York City time, on the date of redemption (the "Tax
Event Redemption Date") or such earlier time as the Company determines, provided
that the Company shall have deposited with the Trustee an amount sufficient to
pay the aggregate Redemption Price by 10:00 a.m. on the Tax Event Redemption
Date. Such redemption shall otherwise be in accordance with the provisions of
Article XI of the Indenture.
(b) (i) In connection with a Cash Merger Event so long as
the Subordinated Notes are held by the Trust, then the Company shall on or
before 12:00 noon, New York City time, on the applicable Cash Merger Redemption
Date, redeem Subordinated Notes in an aggregate principal amount equal to the
aggregate liquidation amount of Preferred Securities to be redeemed in a Cash
Merger Redemption at a price per Subordinated Note equal to the applicable
Redemption Price (the "Cash Merger Event Redemption Price").
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(ii) In connection with a Cash Merger Event, in the event the
Trust has been dissolved or liquidated and the Subordinated Notes have been
distributed to Holders other than the Trust, each Holder of Subordinated Notes
shall have the right to require the Company to redeem all or any part (equal to
$25 or an integral multiple thereof) of such Holder's Subordinated Notes
pursuant to the offer described below (the "Cash Merger Event Offer") at an
offer price in cash equal to the applicable Redemption Price had Preferred
Securities been outstanding at the time and a Cash Merger Redemption right been
triggered in respect of such Preferred Securities (also, the "Cash Merger Event
Redemption Price").
No later than the day of the Cash Merger Event, the Company shall
mail or cause to be mailed a notice of a pending Cash Merger Event to each
Holder (at its last registered address with a copy to the Trustee and the Paying
Agent) offering to repurchase the Subordinated Notes held by such Holder
pursuant to the procedures specified in such notice. The Cash Merger Event Offer
shall remain open from the time of mailing until at least 5:00 p.m. on the
Business Day immediately preceding the Notes Cash Merger Redemption Date (as
such term is defined below). The notice, which shall govern the terms of the
Cash Merger Event Offer, shall contain all instructions and materials necessary
to enable the Holders to tender Subordinated Notes pursuant to the Cash Merger
Event Offer and shall state:
(A) that the Cash Merger Event Offer is being made pursuant to
this Section 2.5(b)(ii) and that all Subordinated Notes
tendered will be accepted for payment;
(B) the applicable Cash Merger Event Redemption Price and the
Notes Cash Merger Redemption Date, which date shall be no
earlier than 20 business days from the date such notice is
mailed;
(C) that any Subordinated Note not tendered will continue to
accrue interest in accordance with the terms of this Fourth
Supplemental Indenture and the Indenture;
(D) that, unless the Company defaults in the payment of the
applicable Cash Merger Event Redemption Price, all
Subordinated Notes accepted for payment pursuant to the Cash
Event Merger Offer will cease to accrue interest after the
Notes Cash Merger Redemption Date;
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(E) that Holders electing to have a Subordinated Note purchased
pursuant to any Cash Event Merger Offer will be required to
surrender the Subordinated Note, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Subordinated Note completed, to the Company, a depositary, if
appointed by the Company, or a Paying Agent at the address
specified in the notice prior to the 5:00 p.m. on the Business
Day immediately preceding the Notes Cash Merger Redemption
Date;
(F) that Holders will be entitled to withdraw their election if
the Company, depositary or Paying Agent, as the case may be,
receives, not later than 5:00 p.m. on the Business Day
immediately preceding the Notes Cash Merger Redemption Date, a
facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Subordinated Note the
Holder delivered for purchase, and a statement that such
Holder is withdrawing his election to have such Subordinated
Note purchased;
(G) that Holders whose Subordinated Notes are being purchased only
in part will be issued new Subordinated Notes equal in
principal amount to the unpurchased portion of the
Subordinated Notes surrendered, which unpurchased portion must
be equal to $25 in principal amount or an integral multiple
thereof; and
(H) the circumstances and relevant facts regarding such Cash
Merger Event and any other information that would be material
to a decision as to whether to tender a Subordinated Note
pursuant to the Cash Merger Event Offer.
On the Notes Cash Merger Redemption Date, the Company shall, to the
extent lawful, (i) accept for payment all Subordinated Notes or portions thereof
properly tendered and not withdrawn pursuant to the Cash Merger Event Offer,
(ii) deposit with the Paying Agent an amount equal to the Cash Merger Event
Payment in respect of all Subordinated Notes or portions thereof so tendered and
(iii) deliver or cause to be delivered to the Trustee the Subordinated Notes so
accepted together with an Officers' Certificate stating the aggregate principal
amount of Subordinated Notes or portions thereof being purchased by the Company.
The Paying Agent shall promptly mail to each Holder of Subordinated Notes so
tendered the Cash Merger
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Event Redemption Price for each such Subordinated Note, and the Trustee shall
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new Subordinated Note equal in principal amount to any unpurchased
portion of the Subordinated Notes surrendered, if any; provided that each such
new Subordinated Note shall be in a principal amount of $25 or an integral
multiple thereof. The Company shall publicly announce the results of the Cash
Merger Event Offer on or as soon as practicable after the applicable Notes Cash
Merger Redemption Date.
The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
redemption of Subordinated Notes as a result of a Cash Merger Event.
The aggregate Redemption Price to be paid in connection with this
Section 2.5(b) shall be paid prior to 12:00 noon, New York City time, on the
Business Day immediately following the last day of the corresponding Early
Settlement Week (the "Notes Cash Merger Redemption Date") or such earlier time
as the Company determines, provided that the Company shall have deposited with
the Trustee an amount sufficient to pay the aggregate Redemption Price by 10:00
a.m. on the Notes Cash Merger Redemption Date.
(c) Except as provided in Sections 2.5(a) and 2.5(b), the
Company will have no right to redeem the Subordinated Notes.
(d) The Subordinated Notes will not be subject to a sinking
fund provision.
Section 2.6 Events of Default. So long as the Subordinated
Notes are held by the Trust, it shall be an Event of Default with respect to the
Subordinated Notes if the Trust shall have voluntarily or involuntarily
dissolved, wound up its business or otherwise terminated its existence except in
connection with (i) the distribution of the Subordinated Notes held by the Trust
to the holders of the Preferred Securities and Common Securities in liquidation
of their interests in the Trust, (ii) the redemption of all of the outstanding
Preferred Securities and Common Securities or (iii) a consolidation, conversion,
amalgamation, merger or other transaction involving the Trust that is permitted
under Section 3.15 of the Declaration.
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Section 2.7 Paying Agent; Security Registrar. If the
Subordinated Notes are issued in certificated form, the Paying Agent and the
Security Registrar for the Subordinated Notes shall be the Property Trustee.
Section 2.8 Extension of Interest Payment Period. The Company
shall have the right at any time and from time to time, prior to August 18,
2003, to defer payments of interest by extending the interest payment period of
such Subordinated Notes for a period not exceeding 12 consecutive quarters or
extending beyond August 18, 2003 (the "Extension Period"), during which
Extension Period no interest shall be due and payable. To the extent permitted
by applicable law, interest, the payment of which has been deferred because of
the extension of the interest payment period pursuant to this Section 2.8, will
bear interest thereon at the rate of 7.25% compounded quarterly for each quarter
of the Extension Period ("Compounded Interest"). At the end of the Extension
Period, the Company shall pay all interest accrued and unpaid on the
Subordinated Notes and Compounded Interest (together, "Deferred Interest") that
shall be payable to the Holders of the Subordinated Notes in whose names the
Subordinated Notes are registered in the Security Register on the first Regular
Record Date after the end of the Extension Period. So long as Preferred
Securities are outstanding, the Company shall not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock (which
includes common and preferred stock), (ii) make any payment of principal,
interest or premium, if any, on or repay or repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in right of
payment to the Subordinated Notes or (iii) make any guarantee payments with
respect to any guarantee by the Company of any securities of any subsidiary of
the Company if such guarantee ranks pari passu or junior in right of payment to
the Subordinated Notes (other than in the case of clauses (i), (ii) and (iii),
(a) dividends or distributions in shares of, or options, warrants or rights to
subscribe for or purchase shares of, common stock of the Company, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Preferred Securities Guarantee Agreement, dated as of August
22, 2000, by and between the Company, as guarantor, and The Bank of New York, as
guarantee trustee (the "Preferred Securities Guarantee Agreement"), (d) as a
result of a reclassification of the Company's capital stock solely into shares
of one or more classes or series of the Company's capital stock or the exchange
or the conversion of one class or series of the Company's capital stock for
another class or series of the Company's capital stock, (e) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged and (f) purchases of
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the Company's common stock in connection with the satisfaction by the Company of
its obligations (including purchases related to the issuance of such common
stock or rights) under any of the Company's benefit plans for its and its
subsidiaries' directors, officers or employees or any of the Company's dividend
reinvestment plans), (x) if at such time an Event of Default or an "Event of
Default," as defined in the Preferred Securities Guarantee Agreement, shall have
occurred and be continuing or (y) during any Extension Period. Prior to the
expiration of any Extension Period, the Company may further extend such period,
provided that such period together with all such previous and further extensions
thereof shall not exceed 12 quarters or extend beyond August 18, 2003. Upon
termination of any Extension Period and the payment of all Deferred Interest
then due, the Company may commence a new Extension Period, subject to the
foregoing requirements. No interest shall be due and payable during an Extension
Period except at the end thereof, but the Company, at its option, may prepay on
any Interest Payment Date all or any portion of the interest accrued during the
then elapsed portion of an Extension Period.
Section 2.9 Notice of Extension. The Company shall give written
notice to the Trustee of its election of any Extension Period (or any further
extension thereof) at least five Business Days before the earlier of (i) the
date the interest on the Subordinated Notes would have been payable except for
the election to begin or extend the Extension Period; (ii) the date the Trustee
is required to give notice to any securities exchange or to Holders of
Subordinated Notes of the Record Date or the Interest Payment Date, and (iii)
the Record Date.
Section 2.10 Place of Payment. The Place of Payment will be
initially the principal corporate trust office of the Trustee which, at the date
hereof, is located at 000 Xxxxxxx, 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust Administration Department.
ARTICLE III
EXPENSES
Section 3.1 Payment of Expenses. In connection with the
offering, sale and issuance of the Subordinated Notes to the Trust in connection
with the sale of the Preferred Securities and Common Securities by the Trust,
the Company will:
(a) pay for all costs and expenses relating to the offering,
sale and issuance of the Subordinated Notes, including compensation of the
Trustee under the Indenture; and
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(b) pay for all costs and expenses of the Trust, including,
but not limited to, costs and expenses relating to the organization of the
Trust, the offering, sale and issuance of the Trust Securities; the fees and
expenses of the Property Trustee (including, without limitation, those incurred
in connection with the enforcement by the Property Trustee of the rights of the
holders of the Preferred Securities), the Delaware Trustee and the Regular
Trustees; the costs and expenses relating to the operation of the Trust
(including, without limitation, costs and expenses of accountants, attorneys,
statistical or bookkeeping services, expenses for printing and engraving and
computing or accounting equipment, paying agent(s), registrar(s), transfer
agent(s), duplicating, travel and telephone and other telecommunications
expenses); and costs and expenses incurred in connection with the acquisition,
financing and disposition of Trust assets;
(c) be primarily liable for any indemnification obligations
arising with respect to the Declaration; and
(d) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and all liabilities,
costs and expenses with respect to such taxes of the Trust.
ARTICLE IV
COVENANTS
Section 4.1 Covenants in the Event of an Event of Default. As
long as Preferred Securities are outstanding, if an Event of Default occurs and
is continuing, then the Company may not:
(a) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any of
the Company's capital stock (which includes common and preferred stock);
(b) make any payment of principal, interest or premium, if
any, on or repay or repurchase or redeem any debt securities of the Company that
rank pari passu with or junior in right of payment to the Subordinated Notes; or
(c) make any guarantee payments with respect to any
guarantee by the Company of any securities of any subsidiary of the Company if
such guarantee ranks pari passu or junior in right of payment to the
Subordinated Notes (other than in the case of clauses (a), (b) and (c), (i)
dividends or distributions in shares of, or options, warrants or rights to
subscribe for or purchase shares of, common stock of the Company, (ii) any
declaration of a dividend in connection with
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the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto, (iii) payments under the Preferred Securities Guarantee
Agreement, (iv) as a result of a reclassification of the Company's capital stock
solely into shares of one or more classes or series of the Company's capital
stock or the exchange or the conversion of one class or series of the Company's
capital stock for another class or series of the Company's capital stock, (v)
the purchase of fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged and (vi) purchases of the Company's common
stock in connection with the satisfaction by the Company of its obligations
(including purchases related to the issuance of such common stock or rights)
under any of the Company's benefit plans for its and its subsidiaries'
directors, officers or employees or any of the Company's dividend reinvestment
plans).
Section 4.2 Additional Covenants Relating to the Trust. For as
long as the Preferred Securities remain outstanding, the Company will:
(a) maintain, directly or indirectly, 100% ownership of the
Common Securities;
(b) cause the Trust to remain a statutory business trust and
not to voluntarily dissolve, wind up, liquidate or be terminated, except as
permitted by the Declaration;
(c) use its commercially reasonable efforts to ensure that
the Trust will not be an "investment company" required to be registered under
the Investment Company Act of 1940;
(d) not take any action that would be reasonably likely to
cause the Trust to be classified as an association or a publicly traded
partnership taxable as a corporation for United States federal income tax
purposes; and
(e) pay all of the debts and obligations of the Trust (other
than with respect to the securities issued by the Trust) and all costs and
expenses of the Trust (including, but not limited to, all costs and expenses
relating to the organization of the Trust, the fees and expenses of the trustees
and all costs and expenses relating to the operation of the Trust) and any and
all taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed on the Trust by the United States, or any other
taxing authority, so that the net amounts received and retained by the Trust
after paying such expenses
13
17
will be equal to the amounts the Trust would have received had no such costs or
expenses been incurred by or imposed on the Trust.
ARTICLE V
ORIGINAL ISSUE OF SUBORDINATED NOTES
Section 5.1 Original Issue of Subordinated Notes. Subordinated
Notes in an aggregate principal amount of up to $257,731,975 may, upon execution
of this Fourth Supplemental Indenture, be executed by the Company and delivered
to the Trustee for authentication, and the Trustee shall thereupon authenticate
and deliver said Subordinated Notes upon receipt of a Company Order for
authentication and delivery, without any further action by the Company.
ARTICLE VI
RIGHTS OF HOLDERS OF PREFERRED SECURITIES
Section 6.1 Preferred Security Holders' Rights. Notwithstanding
Section 5.6 of the Indenture, if the Property Trustee fails to enforce its
rights under the Subordinated Notes after a holder of Preferred Securities has
made a written request, the holder of Preferred Securities may, to the fullest
extent permitted by law, institute a legal proceeding directly against the
Company to enforce the Property Trustee's rights under the Indenture without
first instituting any legal proceeding against the Property Trustee or any other
Person.
Section 6.2 Direct Action. Notwithstanding any other provision
of the Indenture, for as long as any Preferred Securities remain outstanding, to
the fullest extent permitted by law, if an Event of Default has occurred and is
continuing and such event is attributable to the failure of the Company to pay
interest or principal on the Subordinated Notes on the date such interest or
principal is otherwise payable (or in the case of redemption, the redemption
date), then a holder of Preferred Securities may institute a proceeding directly
against the Company (a "Direct Action") to enforce payment to such holder of the
principal or interest on Subordinated Notes having an aggregate principal amount
equal to the aggregate liquidation amount of the Preferred Securities of such
holder.
Section 6.3 Payments Pursuant to Direct Actions. The Company
will have the right to set off against its obligations to the Trust, as Holder
of the Subordinated Notes, any payment made to a holder of Preferred Securities
in connection with a Direct Action.
14
18
Section 6.4 Modifications. So long as any Preferred Securities
remain outstanding, (i) no amendment to this Indenture shall be made that
adversely affects the holders of the Preferred Securities in any material
respect, and no termination of this Indenture shall occur, and no waiver of any
Event of Default or compliance with any covenant under this Indenture shall be
effective, without the prior consent of the holders of at least a Majority in
Liquidation Amount (as defined in the Declaration) of the Preferred Securities
then outstanding unless and until the principal of (and premium, if any, on) the
Subordinated Note and all accrued and unpaid interest thereon have been paid in
full, and (ii) no amendment shall be made to this Article VI of this Fourth
Supplemental Indenture that would impair the rights of the holders of the
Preferred Securities without the prior consent of the holders of each Preferred
Security then outstanding unless and until the principal of (and premium, if
any, on) the Subordinated Note and all accrued and unpaid interest thereon have
been paid in full.
ARTICLE VII
REMARKETING
Section 7.1 Effectiveness of this Article. Upon a distribution
of the Subordinated Notes upon the liquidation and dissolution of the Trust
which occurs prior to the Remarketing of the Preferred Securities pursuant to
the Declaration, the Subordinated Notes shall be Remarketed in accordance with
the Remarketing procedures of the Declaration where all references in the
Remarketing procedures to Preferred Securities shall be read as references to
the Subordinated Notes, unless the context requires otherwise. Until such a
distribution, or if such distribution occurs after the Remarketing of the
Preferred Securities pursuant to the Declaration, this Article VII will have no
effect.
ARTICLE VIII
ACCELERATION OF MATURITY
Section 8.1 Automatic Acceleration. Notwithstanding Section 5.1
of the Indenture, if an Event of Default with respect to the Subordinated Notes
specified in clauses (e) or (f) of Section 5.1 of the Indenture occurs and is
continuing, the principal of the Subordinated Notes shall become due and payable
immediately, without any declaration, notice or other act on the part of the
Trustee or any holder thereof.
15
19
ARTICLE IX
MISCELLANEOUS
Section 9.1 Execution of Fourth Supplemental Indenture. This
Fourth Supplemental Indenture is executed and shall be construed as an indenture
Fourth Supplemental to the Indenture and, as provided in the Indenture, this
Fourth Supplemental Indenture forms a part thereof.
Section 9.2 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof which is
required to be included in this Fourth Supplemental Indenture by any of the
provisions of the Trust Indenture Act, such required provision shall control.
Section 9.3 Effect of Headings. The Article and Section
headings herein are for convenience only and shall not affect the construction
hereof.
Section 9.4 Successors and Assigns. All covenants and
agreements in this Fourth Supplemental Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
Section 9.5 Separability Clause. In case any provision in this
Fourth Supplemental Indenture or in the Subordinated Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 9.6 Benefits of Fourth Supplemental Indenture. Nothing
in this Fourth Supplemental Indenture or in the Subordinated Notes, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the holders, any benefit or any legal or equitable
right, remedy or claim under this Fourth Supplemental Indenture.
Section 9.7 Governing Law. This Fourth Supplemental Indenture
and each Subordinated Note shall be deemed to be a contract made under the laws
of the State of Michigan, and for all purposes shall be governed by and
construed in accordance with the laws of said State, except as may otherwise be
required by mandatory provisions of law, provided, however, that the rights,
duties and obligations of the Trustee are governed and construed in accordance
with the laws of the State of New York.
16
20
IN WITNESS WHEREOF, the parties hereto have caused this Fourth
Supplemental Indenture to be duly executed, all as of the day and year first
above written.
CMS ENERGY CORPORATION
By: /s/ Xxxx X. Xxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President
and Chief Financial Officer
THE BANK OF NEW YORK
as Trustee
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Assistant Vice President
S-1
21
EXHIBIT A
[FORM OF FACE OF SUBORDINATED DEFERRABLE NOTE]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS GLOBAL SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES HEREINAFTER DESCRIBED AND MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY NOMINEE TO A SUCCESSOR OF THE DEPOSITARY OR A
NOMINEE OF SUCH SUCCESSOR.
REGISTERED REGISTERED
[CUSIP No. _______]
CMS ENERGY CORPORATION
7 1/4% SUBORDINATED DEFERRABLE NOTE DUE 2004
$___________
CMS ENERGY CORPORATION, a corporation duly organized and
existing under the laws of Michigan (herein called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay CMS Energy Trust III, or registered
assigns, the principal sum of _______________________ Dollars on August 18,
2004, and to pay interest on said principal sum from August 22, 2000, or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, quarterly in arrears on August 18, November 18, February 18 and
May 18 of each year (an "Interest Payment Date") commencing November 18, 2000,
at the rate of 7.25% per
22
annum until August 18, 2003, and at the Reset Rate thereafter, until the
principal hereof shall have become due and payable, and on any overdue principal
and premium, if any, and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment of
interest at the same rate per annum compounded quarterly. Any deferred interest
shall accrue interest at the rate set forth in the Fourth Supplemental
Indenture. The amount of interest payable for any period will be computed (1)
for any full quarterly period on the basis of a 360-day year of twelve 30-day
months and (2) for any period shorter than a full quarterly period, on the basis
of a 30-day month and, for any period less than a month, on the basis of the
actual number of days elapsed per 30-day month. In the event that any date on
which interest is payable is not a Business Day, then payment of the interest
payable on such date will be made on the next day that is a Business Day (and
without any interest or other payment in respect of such delay), except that, if
such Business Day is in the next calendar year, then such payment will be made
on the preceding Business Day. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, referred to on the reverse side hereof, be paid to
the Holder in whose name this Security (or one or more Predecessor Securities,
as defined in said Indenture) is registered at the close of business on the
Regular Record Date for such interest installment, which, shall be the close of
business on the Business Day 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 Holder in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date to
be fixed by the Trustee referred to on the reverse side hereof for the payment
of such defaulted interest, notice whereof shall be given to the Holders of the
Security not less than 10 days prior to such Special Record Date, or may be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Security may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in the
Indenture.
Payment of the principal of and premium, if any, and interest
on this Security will be made at the office or agency of the Trustee maintained
for that purpose in such coin or currency of the United States of America that
at the time of payment is legal tender for payment of public and private debts.
The Company may pay principal and interest by check payable in such money mailed
to the Holder's registered address or by wire transfer to a dollar account
designated by the Holder.
Interest on the Securities is deferrable in accordance with
the terms of the Fourth Supplemental Indenture.
A-2
23
This Security is, to the extent provided in the Indenture, a
subordinated, unsecured obligation of the Company, subject in right to the prior
payment in full of all Senior Indebtedness (as such term is defined in the
Indenture).
Unless the Certificate of Authentication hereon has been
executed by or on behalf of the Trustee, this Security shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose. The
provisions of this Security are continued on the reverse side hereof, and such
continued provisions shall for all purposes have the same effect as though fully
set forth at this place.
A-3
24
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
CMS ENERGY CORPORATION
Dated: By:
-----------------------------------
Name:
Title:
Attest:
By:
-----------------------------------
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series referred to in the
within-mentioned Indenture.
Dated: THE BANK OF NEW YORK, as
Trustee
By:
--------------------------------
Authorized Signatory
A-4
25
(FORM OF REVERSE OF SUBORDINATED DEFERRABLE NOTE)
CMS ENERGY CORPORATION
7 1/4% SUBORDINATED DEFERRABLE NOTE DUE 2004
This Subordinated Deferrable Note is one of a duly authorized
series of securities of the Company (herein called the "Securities"), issued and
to be issued in one or more series under an Indenture, dated as of June 1, 1997,
as amended and supplemented (as amended and supplemented, the "Indenture"),
between the Company and The Bank of New York as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities and the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to $___________.
All terms used in this Security that are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
This Security is not subject to any sinking fund, nor may this
Security be redeemed at the option of the Company prior to the Maturity Date
except upon the occurrence of a Tax Event as described below.
The Indenture contains provisions for defeasance at any time
of the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth therein.
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture.
If a Tax Event occurs and is continuing, the Company may, at
its option and upon not less than 30 nor more than 60 days' notice to the
Holders of the Securities, redeem the Securities in whole (but not in part)
within 90 days following the occurrence of such Tax Event at the applicable
Redemption Price. The Redemption Price shall be paid prior to 12:00 noon, New
York City time, on the Tax
A-5
26
Event Redemption Date, by check or wire transfer in immediately available funds
at such place and to such account as may be designated by each such Holder.
If a Cash Merger Event occurs, then the Company shall redeem
Subordinated Notes as set forth in the Fourth Supplemental Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities at the time of all series to be
affected (voting as a class). The Indenture also contains provisions permitting
the Holders of a majority in aggregate principal amount of the Outstanding
Securities of each series at the time, on behalf of the Holders of all
Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
This Security shall be exchangeable for Securities registered
in the names of Persons other than the Depositary with respect to such series or
its nominee only as provided in this paragraph. This Security shall be so
exchangeable if (a) the Depositary is at any time unwilling or unable to
continue as Depositary for such series, and the Company fails to appoint a
successor depositary within 90 days, (b) the Depositary has ceased to be a
Clearing Agency registered under the Securities Exchange Act of 1934, as
amended, (c) the Company executes and delivers to the Trustee a Company Order
providing that this Security shall be so exchangeable or (d) there shall have
occurred and be continuing an Event of Default with respect to the Securities of
such series. Securities so issued in exchange for this Security shall be of the
same series, having the same interest rate, if any, and maturity and having the
same terms as this Security, in authorized denominations and in the aggregate
having
A-6
27
the same principal amount as this Security and registered in such names as the
Depositary for such Global Security shall direct.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of a Security of the series of which
this Security is a part is registrable in the Security Register, upon surrender
of this Security for registration of transfer at the office or agency of the
Company in any place where the principal of and premium, if any, and interest,
if any, on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of the series of which this Security is a part
are issuable only in registered form without coupons in denominations of $25 and
in integral multiples thereof. As provided in the Indenture and subject to
certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series
and of like tenor of a different authorized denomination, as requested by the
Holder surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Holder in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
This Security shall be deemed to be a contract made under the
laws of the State of Michigan, and for all purposes shall be governed by and
construed in accordance with the laws of said State, except as otherwise may be
required by mandatory provisions of law, provided, however, that the rights,
duties and obligations of the Trustee are governed and construed in accordance
with the laws of the State of New York.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
A-7
28
OPTION OF HOLDER TO ELECT PURCHASE
This form is to be used to make an election in the event of a Cash
Merger Event Offer, as set forth in Section 2.5(b)(ii) of the Fourth
Supplemental Indenture. If you want to have only part of the Security purchased
by the Company pursuant to Section 2.5(b)(ii) of the Declaration, state the
amount you elect to have purchased:
$_______________________
Date:___________________
Your Signature:_________________________________
(Sign exactly as your name appears
on the face of this Security)
Signature Guarantee
A-8
29
EXHIBIT B
[FORM OF FACE OF SUBORDINATED DEFERRABLE NOTE]
No. _______ REGISTERED
CMS ENERGY CORPORATION
7 1/4% SUBORDINATED DEFERRABLE NOTE DUE 2004
$___________
CMS ENERGY CORPORATION, a corporation duly organized and
existing under the laws of Michigan (herein called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay CMS Energy Trust III, or registered
assigns, the principal sum of _______________________ Dollars on August 18,
2004, and to pay interest on said principal sum from August 22, 2000, or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, quarterly in arrears on August 18, November 18, February 18 and
May 18 of each year (an "Interest Payment Date") commencing August 22, 2000, at
the rate of 7.25% per annum until August 18, 2003, and at the Reset Rate
thereafter, until the principal hereof shall have become due and payable, and on
any overdue principal and premium, if any, and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum compounded quarterly.
Any deferred interest shall accrue interest at the rate set forth in the Fourth
Supplemental Indenture. The amount of interest payable for any period will be
computed (1) for any full quarterly period on the basis of a 360-day year of
twelve 30-day months and (2) for any period shorter than a full quarterly
period, on the basis of a 30-day month and, for any period less than a month, on
the basis of the actual number of days elapsed per 30-day month. In the event
that any date on which interest is payable is not a Business Day, then payment
of the interest payable on such date will be made on the next day that is a
Business Day (and without any interest or other payment in respect of such
delay), except that, if such Business Day is in the next calendar year, then
such payment will be made on the preceding Business Day. The interest
installment so payable, and
B-1
30
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, referred to on the reverse side hereof, be paid to
the Holder in whose name this Security (or one or more Predecessor Securities as
defined in said Indenture) is registered at the close of business on the Regular
Record Date for such interest installment, which, shall be the close of business
on the Business Day 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 Holder
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date to be fixed by the
Trustee referred to on the reverse side hereof for the payment of such defaulted
interest, notice whereof shall be given to the Holders of the Security not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Security may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.
Payment of the principal of and premium, if any, and interest
on this Security will be made at the office or agency of the Trustee maintained
for that purpose in such coin or currency of the United States of America that
at the time of payment is legal tender for payment of public and private debts.
The Company may pay principal and interest by check payable in such money mailed
to the Holder's registered address or by wire transfer to a dollar account
designated by the Holder
Interest on the Securities is deferrable in accordance with
the terms of the Fourth Supplemental Indenture.
This Security is, to the extent provided in the Indenture, a
subordinated, unsecured obligation of the Company, subject in right to the prior
payment in full of all Senior Indebtedness (as such term is defined in the
Indenture).
Unless the Certificate of Authentication hereon has been
executed by or on behalf of the Trustee, this Security shall not be entitled to
any benefit under the Indenture or be valid or obligatory for any purpose. The
provisions of this Security are continued on the reverse side hereof, and such
continued provisions shall for all purposes have the same effect as though fully
set forth at this place.
B-2
31
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
CMS ENERGY CORPORATION
Dated: By:
---------------------------------
Name:
Title:
Attest:
By:
---------------------------------
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series referred to in the
within-mentioned Indenture.
Dated: THE BANK OF NEW YORK,
as Trustee
By:
---------------------------------
Authorized Signatory
B-3
32
(FORM OF REVERSE OF SUBORDINATED DEFERRABLE NOTE)
CMS ENERGY CORPORATION
7 1/4% SUBORDINATED DEFERRABLE NOTE DUE 2004
This Subordinated Deferrable Note is one of a duly authorized
series of securities of the Company (herein called the "Securities"), issued and
to be issued in one or more series under an Indenture, dated as of June 1, 1997,
as amended and supplemented (as amended and supplemented, the "Indenture"),
between the Company and The Bank of New York, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities and the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to $___________.
All terms used in this Security that are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
This Security is not subject to any sinking fund, nor may this
Security be redeemed at the option of the Company prior to the Maturity Date
except upon the occurrence of a Tax Event as described below.
The Indenture contains provisions for defeasance at any time
of the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth therein.
If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture.
If a Tax Event occurs and is continuing, the Company may, at
its option and upon not less than 30 nor more than 60 days' notice to the
Holders of the Securities, redeem the Securities in whole (but not in part)
within 90 days following the occurrence of such Tax Event at the applicable
Redemption Price. The Redemption Price shall be paid prior to 12:00 noon, New
York City time, on the Tax
B-4
33
Event Redemption Date, by check or wire transfer in immediately available funds
at such place and to such account as may be designated by each such Holder.
If a Cash Merger Event occurs, then the Company shall redeem
Subordinated Notes as set forth in the Fourth Supplemental Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities at the time of all series to be
affected (voting as a class). The Indenture also contains provisions permitting
the Holders of a majority in aggregate principal amount of the Outstanding
Securities of each series at the time, on behalf of the Holders of all
Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest, if any, on this Security at the times, place and
rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of a Security of the series of which
this Security is a part is registrable in the Security Register, upon surrender
of this Security for registration of transfer at the office or agency of the
Company in any place where the principal of and premium, if any, and interest,
if any, on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of the series of which this Security is a part
are issuable only in registered form without coupons in denominations of $25 and
in integral
B-5
34
multiples thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Holder in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
This Security shall be deemed to be a contract made under the
laws of the State of Michigan, and for all purposes shall be governed by and
construed in accordance with the laws of said State, except as otherwise may be
required by mandatory provisions of law, provided, however, that the rights,
duties and obligations of the Trustee are governed and construed in accordance
with the laws of the State of New York.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
B-6
