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EXHIBIT 4.1
RELIANT ENERGY RESOURCES CORP.
(formerly known as NorAm Energy Corp.)
To
THE CHASE MANHATTAN BANK
(successor to Chase Bank Of Texas, National Association)
Trustee
__________________
SUPPLEMENTAL INDENTURE NO. 4
Dated as of February 15, 2001
_________________
$550,000,000
7.75% Notes due 2011
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RELIANT ENERGY RESOURCES CORP.
(formerly known as NorAm Energy Corp.)
SUPPLEMENTAL INDENTURE NO. 4
$550,000,000
7.75% Notes due 2011
SUPPLEMENTAL INDENTURE No. 4, dated as of February 15, 2001, between
RELIANT ENERGY RESOURCES CORP., a Delaware corporation formerly known as NorAm
Energy Corp. (the "Company"), and THE CHASE MANHATTAN BANK (successor to Chase
Bank of Texas, National Association), a New York state bank, as Trustee (the
"Trustee").
RECITALS
The Company has heretofore executed and delivered to the Trustee an
Indenture, dated as of February 1, 1998 (the "Original Indenture" and, as
previously and hereby supplemented and amended, the "Indenture"), providing for
the issuance from time to time of one or more series of the Company's
Securities.
The Company has changed its name from "NorAm Energy Corp." to "Reliant
Energy Resources Corp." and all references in the Indenture to the "Company" or
"NorAm Energy Corp." shall be deemed to refer to Reliant Energy Resources Corp.
Pursuant to the terms of the Indenture, the Company desires to provide for
the establishment of a new series of Securities to be designated as the "7.75%
Notes due 2011" (the "Notes"), the form and substance of such Notes and the
terms, provisions and conditions thereof to be set forth as provided in the
Original Indenture and this Supplemental Indenture No. 4.
Section 301 of the Original Indenture provides that various matters with
respect to any series of Securities issued under the Indenture may be
established in an indenture supplemental to the Indenture.
Subparagraph (7) of Section 901 of the Original Indenture provides that the
Company and the Trustee may enter into an indenture supplemental to the
Indenture to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301 of the Original Indenture.
For and in consideration of the premises and the issuance of the series of
Securities provided for herein, it is mutually covenanted and agreed, for the
equal and proportionate benefit of the Holders of the Securities of such series,
as follows:
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ARTICLE ONE
Relation to Indenture; Additional Definitions
Section 101. Relation to Indenture. This Supplemental Indenture No. 4
constitutes an integral part of the Original Indenture.
Section 102. Additional Definitions. For all purposes of this Supplemental
Indenture No. 4:
Capitalized terms used herein shall have the meaning specified herein
or in the Original Indenture, as the case may be;
"Acquired Entity" has the meaning set forth in Section 303(l) hereof;
"Comparable Treasury Yield" has the meaning set forth in Section
402(a) hereof;
"Consolidated Net Tangible Assets" means the total amount of assets of
the Company and its Subsidiaries less, without duplication: (a) total
current liabilities (excluding indebtedness due within 12 months); (b) all
reserves for depreciation and other asset valuation reserves, but excluding
reserves for deferred federal income taxes arising from accelerated
amortization or otherwise; (c) all intangible assets such as goodwill,
trademarks, trade names, patents and unamortized debt discount and expense
carried as an asset; and (d) all appropriate adjustments on account of
minority interests of other Persons holding common stock of any Subsidiary,
all as reflected in the Company's most recent audited consolidated balance
sheet preceding the date of such determination;
"H.15 Statistical Release" has the meaning set forth in Section 402(b)
hereof;
The term "indebtedness," as applied to the Company or any Subsidiary,
means bonds, debentures, notes and other instruments representing
obligations created or assumed by any such corporation: (i) for money
borrowed (other than unamortized debt discount or premium); (ii) evidenced
by a note or similar instrument given in connection with the acquisition of
any business, properties or assets of any kind; (iii) as lessee under
leases required to be capitalized on the balance sheet of the lessee under
generally accepted accounting principles; and (iv) any amendments,
renewals, extensions, modifications and refundings of any such indebtedness
or obligation listed in clause (i), (ii) or (iii) above. All indebtedness
secured by a lien upon property owned by the Company or any Subsidiary and
upon which indebtedness any such corporation customarily pays interest,
although any such corporation has not assumed or become liable for the
payment of such indebtedness, shall for all purposes hereof be deemed to be
indebtedness of any such corporation. All indebtedness for borrowed money
incurred by other Persons which is directly guaranteed as to payment of
principal by the Company or any Subsidiary shall for all purposes hereof be
deemed to be indebtedness of any such corporation, but no other contingent
obligation of any such corporation in respect of indebtedness incurred by
other Persons shall for any purpose be deemed to be indebtedness of such
corporation. Indebtedness of the Company or any Subsidiary shall
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not include: (i) amounts which are payable only out of all or a portion of
the oil, gas, natural gas, helium, coal, metals, minerals, steam, timber,
hydrocarbons, or geothermal or other natural resources produced, derived or
extracted from properties owned or developed by such corporation; (ii) any
indebtedness incurred to finance oil, gas, natural gas, helium, coal,
metals, minerals, steam, timber, hydrocarbons, or geothermal or other
natural resources or synthetic fuel exploration or development, payable,
with respect to principal and interest, solely out of the proceeds of oil,
gas, natural gas, helium, coal, metals, minerals, steam, timber,
hydrocarbons, or geothermal or other natural resources or synthetic fuel to
be produced, sold, and/or delivered by the Company or any Subsidiary; (iii)
indirect guarantees or other contingent obligations in connection with the
indebtedness of others, including agreements, contingent or otherwise, with
such other Persons or with third Persons with respect to, or to permit or
ensure the payment of, obligations of such other Persons, including,
without limitation, agreements to advance or supply funds to or to invest
in such other Persons, or agreements to pay for property, products or
services of such other Persons (whether or not conferred, delivered or
rendered), and any demand charge, throughput, take-or-pay, keep-well, make-
whole, cash deficiency, maintenance of working capital or earnings or
similar agreements; and (iv) any guarantees with respect to lease or other
similar periodic payments to be made by other Persons;
"Independent Investment Banker" has the meaning set forth in Section
401(c) hereof;
"Interest Payment Date" has the meaning set forth in Section 204(a)
hereof;
"Issue Date" has the meaning set forth in Section 204(a) hereof;
"lien" or "liens" have the meanings set forth in Section 303 hereof;
"Long-Term Indebtedness" means, collectively, the Company's
outstanding: (a) Medium-Term Notes, Series B (due through 2001), (b) 8.90%
Debentures due 2006, and (c) any long-term indebtedness (but excluding for
this purpose any long-term indebtedness, if any, incurred pursuant to any
revolving credit facility, letter of credit facility or other similar bank
credit facility) of the Company issued subsequent to the issuance of the
Notes and prior to the Termination Date containing covenants substantially
similar to the covenants set forth in Sections 303 and 304 hereof, but not
containing a provision substantially similar to the provision set forth in
Section 305 hereof;
"Make-Whole Premium" has the meaning set forth in Section 401(b)
hereof;
"Maturity Date" has the meaning set forth in Section 203 hereof;
"Notes" has the meaning set forth in the third paragraph of the
Recitals hereof;
"Original Indenture" has the meaning set forth in the first paragraph
of the Recitals hereof;
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"Principal Property" means any natural gas distribution property,
natural gas pipeline or gas processing plant located in the United States,
except any such property that in the opinion of the Board of Directors is
not of material importance to the total business conducted by the Company
and its consolidated Subsidiaries. "Principal Property" shall not include
any oil or gas property or the production or proceeds of production from an
oil or gas producing property or the production or any proceeds of
production of gas processing plants or oil or gas or petroleum products in
any pipeline or storage field;
"Redemption Price" has the meaning set forth in Section 401(a) hereof;
"Regular Record Date" has the meaning set forth in Section 204(b)
hereof;
"Remaining Term" has the meaning set forth in Section 402(a) hereof;
"Restricted Subsidiary" means any Subsidiary which owns a Principal
Property;
"Sale and Leaseback Transaction" means any arrangement entered into by
the Company or any Restricted Subsidiary with any Person providing for the
leasing to the Company or any Restricted Subsidiary of any Principal
Property (except for temporary leases for a term, including any renewal
thereof, of not more than three years and except for leases between the
Company and a Restricted Subsidiary or between Restricted Subsidiaries),
which Principal Property has been or is to be sold or transferred by the
Company or such Restricted Subsidiary to such Person;
"Termination Date" has the meaning set forth in Section 305;
"Value" with respect to a Sale and Leaseback Transaction has the
meaning set forth in Section 303 hereof;
All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this
Supplemental Indenture No. 4; and
The terms "herein," "hereof," "hereunder" and other words of similar
import refer to this Supplemental Indenture No. 4.
ARTICLE TWO
The Series of Securities
Section 201. Title of the Securities. The Notes shall be designated as the
"7.75% Notes due 2011."
Section 202. Limitation on Aggregate Principal Amount. The Trustee shall
authenticate and deliver the Notes for original issue on the Issue Date in the
aggregate principal amount of $550,000,000 upon a Company Order for the
authentication and delivery thereof and satisfaction of Sections 301 and 303 of
the Original Indenture. Such order shall specify the amount of the Notes to be
authenticated, the date on which the original issue of Notes is to be
authenticated and
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the name or names of the initial Holder or Holders. The aggregate principal
amount of Notes that may initially be outstanding shall not exceed $550,000,000;
provided, however, that the authorized aggregate principal amount of the Notes
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may be increased above such amount by a Board Resolution to such effect.
Section 203. Stated Maturity. The Stated Maturity of the Notes shall be
February 15, 2011 (the "Maturity Date").
Section 204. Interest and Interest Rates.
(a) The Notes shall bear interest at the rate of 7.75% per annum, from and
including February 21, 2001 (the "Issue Date") to, but excluding, the Maturity
Date. Such interest shall be payable semiannually in arrears, on February 15
and August 15, of each year (each such date, an "Interest Payment Date"),
commencing August 15, 2001.
(b) The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date shall be paid to the Persons in whose names the Notes
(or one or more Predecessor Securities) are registered at the close of business
on the immediately preceding February 1 and August 1, respectively, whether or
not such day is a Business Day (each such date, a "Regular Record Date"). Any
such interest not so punctually paid or duly provided for shall forthwith cease
to be payable to the Holder on such Regular Record Date and shall either (i) be
paid to the Person in whose name such Note (or one or more Predecessor
Securities) is registered at the close of business on the Special Record Date
for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of the Notes not less than 10 days prior to
such Special Record Date, or (ii) be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange or automated
quotation system on which the Notes may be listed or traded, and upon such
notice as may be required by such exchange or automated quotation system, all as
more fully provided in the Indenture.
(c) The amount of interest payable for any period shall be computed on the
basis of a 360-day year of twelve 30-day months. The amount of interest payable
for any partial period shall be computed on the basis of a 360-day year of
twelve 30-day months and the days elapsed in any partial month. In the event
that any date on which interest is payable on a Note is not a Business Day, then
a payment of the interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay) with the same force and effect as if made
on the date the payment was originally payable.
(d) Any principal and premium, if any, and any installment of interest,
which is overdue shall bear interest at the rate of 7.75% per annum (to the
extent permitted by law), from the dates such amounts are due until they are
paid or made available for payment, and such interest shall be payable on
demand.
Section 205. Place of Payment. The Trustee shall initially serve as the
Paying Agent for the Notes. The Place of Payment where the Notes may be
presented or surrendered for payment shall be the Corporate Trust Office of the
Trustee.
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Section 206. Place of Registration or Exchange; Notices and Demands With
Respect to the Notes. The place where the Holders of the Notes may present the
Notes for registration of transfer or exchange and may make notices and demands
to or upon the Company in respect of the Notes shall be the Corporate Trust
Office of the Trustee.
Section 207. Percentage of Principal Amount. The Notes shall be initially
issued at 99.674% of their principal amount plus accrued interest, if any, from
February 21, 2001.
Section 208. Global Securities. The Notes shall be issuable in whole or in
part in the form of one or more Global Securities. Such Global Securities shall
be deposited with, or on behalf of, The Depository Trust Company, New York, New
York, which shall act as Depository with respect to the Notes. Such Global
Securities shall bear the legends set forth in the form of Security attached as
Exhibit A hereto.
Section 209. Form of Securities. The Notes shall be substantially in the
form attached as Exhibit A hereto.
Section 210. Securities Registrar. The Trustee shall initially serve as the
Security Registrar for the Notes.
Section 211. Defeasance and Discharge; Covenant Defeasance.
(a) Article Fourteen of the Original Indenture, including without
limitation, Sections 1402 and 1403 (as modified by Section 211(b) hereof)
thereof, shall apply to the Notes.
(b) Solely with respect to the Notes issued hereby, the first sentence of
Section 1403 of the Original Indenture is hereby deleted in its entirety, and
the following is substituted in lieu thereof:
"Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the
case may be, (1) the Company shall be released from its obligations
under Article Eight and under any covenants provided pursuant to
Section 301(20), 901(2) or 901(7) for the benefit of the Holders of
such Securities and (2) the occurrence of any event specified in
Sections 501(4) (with respect to Article Eight and to any such
covenants provided pursuant to Section 301(20), 901(2) or 901(7)), and
501(7) shall be deemed not to be or result in an Event of Default, in
each case with respect to such Securities as provided in this Section
on and after the date the conditions set forth in Section 1404 are
satisfied (hereinafter called "Covenant Defeasance")."
Section 212. Sinking Fund Obligations. The Company shall have no obligation
to redeem or purchase any Notes pursuant to any sinking fund or analogous
requirement or upon the happening of a specified event or at the option of a
Holder thereof.
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ARTICLE THREE
Additional Covenants
Section 301. Maintenance of Properties. The Company shall cause all
properties used or useful in the conduct of its business or the business of any
Subsidiary to be maintained and kept in good condition, repair and working order
and supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Company may be necessary so that the business
carried on in connection therewith may be properly conducted at all times;
provided, however, that nothing in this Section shall prevent the Company from
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discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary.
Section 302. Payment of Taxes and Other Claims. The Company shall pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, (1) all taxes, assessments and governmental charges levied or
imposed upon the Company or any Subsidiary or upon the income, profits or
property of the Company or any Subsidiary, and (2) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a lien upon the
property of the Company or any Subsidiary; provided, however, that the Company
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shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.
Section 303. Restrictions on Liens. The Company shall not pledge, mortgage
or hypothecate, or permit to exist, and shall not cause, suffer or permit any
Restricted Subsidiary to pledge, mortgage or hypothecate, or permit to exist,
except in favor of the Company or any Restricted Subsidiary, any mortgage,
pledge, lien or other encumbrance (collectively, a "lien" or "liens") upon, any
Principal Property at any time owned by it or a Restricted Subsidiary, to secure
any indebtedness, without making effective provisions whereby the Notes shall be
equally and ratably secured with or prior to any and all such indebtedness and
any other indebtedness similarly entitled to be equally and ratably secured;
provided, however, that this provision shall not apply to or prevent the
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creation or existence of:
(a) undetermined or inchoate liens and charges incidental to
construction, maintenance, development or operation;
(b) the lien of taxes and assessments for the then current year;
(c) the lien of taxes and assessments not at the time delinquent;
(d) the lien of specified taxes and assessments which are delinquent
but the validity of which is being contested at the time by the Company or
such Restricted Subsidiary in good faith and by appropriate proceedings;
(e) the lien reserved in leases for rent and for compliance with the
terms of the lease in the case of leasehold estates;
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(f) any obligations or duties, affecting the property of the Company
or such Restricted Subsidiary, to any municipality or public authority with
respect to any franchise, grant, license, permit or similar arrangement;
(g) the liens of any judgments or attachment in an aggregate amount
not in excess of $10,000,000, or the lien of any judgment or attachment the
execution or enforcement of which has been stayed or which has been
appealed and secured, if necessary, by the filing of an appeal bond;
(h) any lien on any property held or used by the Company or a
Restricted Subsidiary in connection with the exploration for, development
of or production of oil, gas, natural gas (including liquefied gas and
storage gas), other hydrocarbons, helium, coal, metals, minerals, steam,
timber, geothermal or other natural resources or synthetic fuels, such
properties to include, but not be limited to, the Company's or a Restricted
Subsidiary's interest in any mineral fee interests, oil, gas or other
mineral leases, royalty, overriding royalty or net profits interests,
production payments and other similar interests, wellhead production
equipment, tanks, field gathering lines, leasehold or field separation and
processing facilities, compression facilities and other similar personal
property and fixtures;
(i) any lien on oil, gas, natural gas (including liquefied gas and
storage gas), other hydrocarbons, helium, coal, metals, minerals, steam,
timber, geothermal or other natural resources or synthetic fuels produced
or recovered from any property, an interest in which is owned or leased by
the Company or a Restricted Subsidiary;
(j) liens upon any property heretofore or hereafter acquired,
constructed or improved, created at the time of acquisition or within one
year thereafter to secure all or a portion of the purchase price thereof or
the cost of such construction or improvement, or existing thereon at the
date of acquisition, whether or not assumed by the Company or a Restricted
Subsidiary, provided that every such lien shall apply only to the property
so acquired or constructed and fixed improvements thereon;
(k) any extension, renewal or refunding, in whole or in part, of any
lien permitted by subparagraph (j) above, if limited to the same property
or any portion thereof subject to, and securing not more than the amount
secured by, the lien extended, renewed or refunded;
(l) liens upon any property heretofore or hereafter acquired by any
corporation that is or becomes a Restricted Subsidiary after the date
hereof ("Acquired Entity") provided that every such lien (1) shall either
(A) exist prior to the time the Acquired Entity becomes a Restricted
Subsidiary or (B) be created at the time the Acquired Entity becomes a
Restricted Subsidiary or within one year thereafter to secure all or a
portion of the acquisition price thereof and (2) shall only apply to those
properties owned by the Acquired Entity at the time it becomes a Restricted
Subsidiary or thereafter acquired by it from sources other than the Company
or any other Restricted Subsidiary;
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(m) the pledge of current assets, in the ordinary course of business,
to secure current liabilities;
(n) mechanics' or materialmen's liens, any liens or charges arising
by reason of pledges or deposits to secure payment of workmen's
compensation or other insurance, good faith deposits in connection with
tenders, leases of real estate, bids or contracts (other than contracts for
the payment of money), deposits to secure duties or public or statutory
obligations, deposits to secure, or in lieu of, surety, stay or appeal
bonds, and deposits as security for the payment of taxes or assessments or
similar charges;
(o) any lien arising by reason of deposits with, or the giving of any
form of security to, any governmental agency or any body created or
approved by law or governmental regulation for any purpose at any time in
connection with the financing of the acquisition or construction of
property to be used in the business of the Company or a Restricted
Subsidiary or as required by law or governmental regulation as a condition
to the transaction of any business or the exercise of any privilege or
license, or to enable the Company or a Restricted Subsidiary to maintain
self-insurance or to participate in any funds established to cover any
insurance risks or in connection with workmen's compensation, unemployment
insurance, old age pensions or other social security, or to share in the
privileges or benefits required for companies participating in such
arrangements;
(p) any lien of or upon any office equipment, data processing
equipment (including, without limitation, computer and computer peripheral
equipment), or transportation equipment (including, without limitation,
motor vehicles, tractors, trailers, marine vessels, barges, towboats,
rolling stock and aircraft);
(q) any lien created or assumed by the Company or a Restricted
Subsidiary in connection with the issuance of debt securities, the interest
on which is excludable from gross income of the holder of such security
pursuant to the Internal Revenue Code, as amended, for the purposes of
financing, in whole or in part, the acquisition or construction of property
to be used by the Company or a Restricted Subsidiary; or
(r) the pledge or assignment of accounts receivable, or the pledge or
assignment of conditional sales contracts or chattel mortgages and
evidences of indebtedness secured thereby, received in connection with the
sale by the Company or such Restricted Subsidiary or others of goods or
merchandise to customers of the Company or such Restricted Subsidiary.
In case the Company or any Restricted Subsidiary shall propose to pledge,
mortgage, or hypothecate any Principal Property at any time owned by it to
secure any indebtedness, other than as permitted by subdivision (a) to (r),
inclusive, of this Section 303, the Company shall prior thereto give written
notice thereof to the Trustee, and the Company shall or shall cause such
Restricted Subsidiary to, prior to or simultaneously with such pledge, mortgage
or hypothecation, by supplemental indenture executed to the Trustee (or to the
extent legally necessary to another
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trustee or additional or separate trustee), in form satisfactory to the Trustee,
effectively secure all the Notes equally and ratably with, or prior to, such
indebtedness.
Notwithstanding the foregoing provisions of this Section 303, the Company
or a Restricted Subsidiary may issue, assume or guarantee indebtedness secured
by a mortgage which would otherwise be subject to the foregoing restrictions in
an aggregate amount which, together with all other indebtedness of the Company
or a Restricted Subsidiary secured by a mortgage which (if originally issued,
assumed or guaranteed at such time) would otherwise be subject to the foregoing
restrictions (not including indebtedness permitted to be secured under clauses
(a) through (r) above) and the Value of all Sale and Leaseback Transactions in
existence at such time (other than any Sale and Leaseback Transaction which, if
such Sale and Leaseback Transaction had been a lien, would have been permitted
by paragraph (j) of this Section 303 and other than Sale and Leaseback
Transactions as to which application of amounts have been made in accordance
with paragraph (l) of this Section 303) does not at the time of incurrence of
such indebtedness exceed 5% of Consolidated Net Tangible Assets. "Value" means,
with respect to a Sale and Leaseback Transaction, as of any particular time, the
amount equal to the greater of (1) the net proceeds from the sale or transfer of
the property leased pursuant to such Sale and Leaseback Transaction or (2) the
fair value, in the opinion of the Board of Directors, of such property at the
time of entering into such Sale and Leaseback Transaction, in either case
divided first by the number of full years of the term of the lease and then
multiplied by the number of full years of such term remaining at the time of
determination, without regard to any renewal or extension options contained in
the lease.
Section 304. Restrictions on Sale and Leaseback Transactions. The Company
shall not, nor shall it permit any Restricted Subsidiary to, enter into any Sale
and Leaseback Transaction unless the net proceeds of such sale are at least
equal to the fair value (as determined by the Board of Directors) of such
Principal Property and either (a) the Company or such Restricted Subsidiary
would be entitled, pursuant to the provisions of (1) paragraph (j) of Section
303 or (2) paragraph (1) of Section 303, to incur indebtedness secured by a lien
on the Principal Property to be leased without equally and ratably securing the
Notes, or (b) the Company shall, and in any such case the Company covenants that
it will, within 120 days of the effective date of any such arrangement, apply an
amount not less than the fair value (as so determined) of such Principal
Property (i) to the payment or other retirement of Funded Debt incurred or
assumed by the Company which ranks senior to or pari passu with the Notes or of
Funded Debt incurred or assumed by any Restricted Subsidiary (other than, in
either case, Funded Debt owned by the Company or any Restricted Subsidiary), or
(ii) to the purchase at not more than fair value (as so determined) of Principal
Property (other than the Principal Property involved in such sale). For this
purpose, "Funded Debt" means any indebtedness which by its terms matures at or
is extendable or renewable at the sole option of the obligor thereon without
requiring the consent of the obligee to a date more than 12 months after the
date of the creation of such indebtedness.
Section 305. Expiration of Restrictions on Liens and Restrictions on Sale
and Leaseback Transactions. Notwithstanding anything to the contrary herein, on
the date (the "Termination Date") (and continuing thereafter) on which there
remains outstanding, in the aggregate, no more than $200,000,000 in principal
amount of Long-Term Indebtedness, the covenants of the
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Company set forth in Sections 303 and 304 hereof shall terminate and the Company
shall no longer be subject to the covenants set forth in such Sections.
ARTICLE FOUR
Optional Redemption of the Notes
Section 401. Redemption Price.
(a) The Company shall have the right to redeem the Notes, in whole or in part,
at its option at any time from time to time at a price equal to (i) 100% of the
principal amount thereof plus (ii) accrued and unpaid interest thereon, if any,
to but excluding the Redemption Date plus (iii) the Make-Whole Premium, if any
(collectively, the "Redemption Price").
(b) The amount of the Make-Whole Premium with respect to any Note (or portion
thereof) to be redeemed will be equal to the excess, if any, of: (i) the sum of
the present values, calculated as of the Redemption Date, of: (A) each interest
payment that, but for such redemption, would have been payable on the Note (or
portion thereof) being redeemed on each Interest Payment Date occurring after
the Redemption Date (excluding any accrued and unpaid interest for the period
prior to the Redemption Date); and (B) the principal amount that, but for such
redemption, would have been payable at the Maturity Date (or portion thereof)
being redeemed; over (ii) the principal amount of the Note (or portion thereof)
being redeemed. The present values of interest and principal payments referred
to in clause (i) above will be determined in accordance with generally accepted
principles of financial analysis. Such present values will be calculated by
discounting the amount of each payment of interest or principal from the date
that each such payment would have been payable, but for the redemption, to the
Redemption Date at a discount rate equal to the Comparable Treasury Yield (as
defined below) plus 30 basis points.
(c) The Make-Whole Premium shall be calculated by an independent investment
banking institution of national standing appointed by the Company; provided,
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however, that if the Company fails to make such appointment at least 45
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days prior to the Redemption Date, or if the institution so appointed is
unwilling or unable to make such calculation, such calculation shall be made by
Banc of America Securities LLC, or, if such firm is unwilling or unable to make
such calculation, by a different independent investment banking institution of
national standing appointed by the Company (in any such case, an "Independent
Investment Banker").
Section 402. Make-Whole Premium.
(a) For purposes of determining the Make-Whole Premium, "Comparable Treasury
Yield" means a rate of interest per annum equal to the weekly average yield to
maturity of United States Treasury Securities that have a constant maturity that
corresponds to the remaining term to maturity of the Notes, calculated to the
nearest 1/12th of a year (the "Remaining Term"). The Comparable Treasury Yield
shall be determined as of the third Business Day immediately preceding the
applicable Redemption Date.
(b) The weekly average yields of United States Treasury Securities shall be
determined by reference to the most recent statistical release published by the
Federal Reserve
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Bank of New York and designated "H.15 (519) Selected Interest Rates" or any
successor release (the "H.15 Statistical Release"). If the H.15 Statistical
Release sets forth a weekly average yield for United States Treasury Securities
having a constant maturity that is the same as the Remaining Term, then the
Comparable Treasury Yield shall be equal to such weekly average yield. In all
other cases, the Comparable Treasury Yield shall be calculated by interpolation,
on a straight-line basis, between the weekly average yields on the United States
Treasury Securities that have a constant maturity closest to and greater than
the Remaining Term and the United States Treasury Securities that have a
constant maturity closest to and less than the Remaining Term (in each case as
set forth in the H.15 Statistical Release). Any weekly average yields so
calculated by interpolation shall be rounded to the nearest 1/100th of 1%, with
any figure of 1/200th of 1% or above being rounded upward. If weekly average
yields for United States Treasury Securities are not available in the H.15
Statistical Release or otherwise, then the Comparable Treasury Yield shall be
calculated by interpolation of comparable rates selected by the Independent
Investment Banker.
Section 403. Partial Redemption. If the Company redeems the Notes in part
pursuant to this Article Four, the Trustee shall select the Notes to be redeemed
on a pro rata basis or by lot or by such other method that the Trustee in its
sole discretion deems fair and appropriate. The Company shall redeem Notes
pursuant to this Article Four in multiples of $1,000 in original principal
amount. A new Note in principal amount equal to the unredeemed portion of the
original Note shall be issued upon cancellation of the original Note.
Section 404. Notice of Optional Redemption. If the Company elects to exercise
its right to redeem all or some of the Notes pursuant to this Article Four, the
Company or the Trustee shall mail a notice of such redemption to each Holder of
a Note that is to be redeemed not less than 30 days and not more than 60 days
before the Redemption Date. If any Note is to be redeemed in part only, the
notice of redemption shall state the portion of the principal amount to be
redeemed.
ARTICLE FIVE
Miscellaneous Provisions
Section 501. The Indenture, as supplemented and amended by this Supplemental
Indenture No. 4, is in all respects hereby adopted, ratified and confirmed.
Section 502. This Supplemental Indenture No. 4 may be executed in any number
of counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
Section 503. THIS SUPPLEMENTAL INDENTURE NO. 4 AND EACH NOTE SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
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Section 504. If any provision in this Supplemental Indenture No. 4 limits,
qualifies or conflicts with another provision hereof which is required to be
included herein by any provisions of the Trust Indenture Act, such required
provision shall control.
Section 505. In case any provision in this Supplemental Indenture No. 4 or the
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.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 4 to be duly executed, as of the day and year first written above.
RELIANT ENERGY RESOURCES CORP.
By:_______________________________
Name: Xxxx Xxxxxxxx
Title: Treasurer
Attest:
______________________________
Name: Xxxxxxx X. Xxxxxxx
Title: Assistant Secretary
(SEAL)
THE CHASE MANHATTAN BANK, as Trustee
By:_______________________________
Name:_________________________
Title:________________________
(SEAL)
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Exhibit A
---------
[FORM OF FACE OF SECURITY]
[IF THIS SECURITY IS TO BE A GLOBAL SECURITY -] 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
SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE 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.
[For as long as this Global Security is deposited with or on behalf of The
Depository Trust Company it shall bear the following legend.] Unless this
certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation ("DTC"), to Reliant Energy Resources Corp. or
its agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
RELIANT ENERGY RESOURCES CORP.
7.75% Notes due 2011
No. ________ $ __________
CUSIP No. ______________
RELIANT ENERGY RESOURCES CORP., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to _______________, or registered
assigns, the principal sum of ____________________ Dollars on February 15, 2011,
and to pay interest thereon from February 21, 2001 or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
semi-annually on February 15 and August 15 in each year, commencing August 15,
2001, at the rate of 7.75% per annum, until the principal hereof is paid or made
available for payment, provided that any principal and premium, and any such
--------
installment of interest, which is overdue shall bear interest at the rate of
7.75% per annum (to the extent permitted by applicable law), from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand. The amount of interest payable for any
period shall be computed on the basis of a 360-day year of twelve 30-day months.
The amount of interest payable for any partial period shall be computed on the
basis of a 360-day year of twelve 30-day months and the days elapsed in any
partial month. In the event that any date on which interest is payable on this
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Security is not a Business Day, then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay) with the
same force and effect as if made on the date the payment was originally payable.
A "Business Day" shall mean, when used with respect to any Place of Payment,
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in that Place of Payment are authorized or obligated by law
or executive order to close. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the February 1 or August 1
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for shall forthwith cease to be payable to the Holder on such Regular
Record Date and will either be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange or automated quotation system on which the Securities of
this series may be listed or traded, and upon such notice as may be required by
such exchange or automated quotation system, all as more fully provided in said
Indenture.
Payment of the principal of (and premium, if any) and any such interest on
this Security will be made at the Corporate Trust Office of the Trustee, 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; provided, however, that
-------- -------
at the option of the Company payment of interest may be made (i) by check mailed
to the address of the Person entitled thereto as such address shall appear in
the Security Register or (ii) by wire transfer in immediately available funds at
such place and to such account as may be designated in writing by the Person
entitled thereto as specified in the Security Register.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: _______________ RELIANT ENERGY RESOURCES CORP.
By:______________________________
Name:_________________________
Title:________________________
(SEAL)
Attest:
____________________________
Name:
Title:
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK, As Trustee
Dated:______________________
By:______________________________
Authorized Signatory
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[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue 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 February 1, 1998 (herein called the
"Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and The Chase Manhattan Bank (successor to
Chase Bank of Texas, National Association), 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 of 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, initially limited in aggregate principal amount to
$550,000,000; provided, however, that the authorized aggregate principal amount
-------- -------
of the Securities may be increased above such amount by a Board Resolution to
such effect.
The Company shall have the right to redeem the Securities of this
series, in whole or in part, at its option at any time from time to time at a
price equal to (i) 100% of the principal amount thereof plus (ii) accrued and
unpaid interest thereon, if any, to (but excluding) the Redemption Date plus
(iii) the Make-Whole Premium, if any.
The amount of the Make-Whole Premium with respect to any Security of
this Series (or portion thereof) to be redeemed will be equal to the excess, if
any, of: (i) the sum of the present values, calculated as of the Redemption
Date, of: (A) each interest payment that, but for such redemption, would have
been payable on the Securities of this series (or portion thereof) being
redeemed on each Interest Payment Date occurring after the Redemption Date
(excluding any accrued and unpaid interest for the period prior to the
Redemption Date); and (B) the principal amount that, but for such redemption,
would have been payable at the Maturity Date (or portion thereof) being
redeemed; over (ii) the principal amount of the Securities of this series (or
portion thereof) being redeemed. The present values of interest and principal
payments referred to in clause (i) above will be determined in accordance with
generally accepted principles of financial analysis. Such present values will
be calculated by discounting the amount of each payment of interest or principal
from the date that each such payment would have been payable, but for the
redemption, to the Redemption Date at a discount rate equal to the Comparable
Treasury Yield (as defined below) plus 30 basis points.
For purposes of determining the Make-Whole Premium, "Comparable
Treasury Yield" means a rate of interest per annum equal to the weekly average
yield to maturity of United States Treasury Securities that have a constant
maturity that corresponds to the remaining term to maturity of the Securities of
this series, calculated to the nearest 1/12th of a year (the "Remaining Term").
The Comparable Treasury Yield shall be determined as of the third Business Day
immediately preceding the applicable Redemption Date.
The weekly average yields of United States Treasury Securities shall
be determined by reference to the most recent statistical release published by
the Federal Reserve
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Xxxx xx Xxx Xxxx and designated "H.15 (519) Selected Interest Rates" or any
successor release (the "H.15 Statistical Release"). If the H.15 Statistical
Release sets forth a weekly average yield for United States Treasury Securities
having a constant maturity that is the same as the Remaining Term, then the
Comparable Treasury Yield shall be equal to such weekly average yield. In all
other cases, the Comparable Treasury Yield shall be calculated by interpolation,
on a straight-line basis, between the weekly average yields on the United States
Treasury Securities that have a constant maturity closest to and greater than
the Remaining Term and the United States Treasury Securities that have a
constant maturity closest to and less than the Remaining Term (in each case as
set forth in the H.15 Statistical Release). Any weekly average yields so
calculated by interpolation shall be rounded to the nearest 1/100th of 1%, with
any figure of 1/200th of 1% or above being rounded upward. If weekly average
yields for United States Treasury Securities are not available in the H.15
Statistical Release or otherwise, then the Comparable Treasury Yield shall be
calculated by interpolation of comparable rates selected by the Independent
Investment Banker.
The Securities of this series are not entitled to the benefit of any
sinking fund.
The Indenture contains provisions for satisfaction and discharge of
the entire indebtedness of this Security upon compliance by the Company with
certain conditions set forth in the Indenture.
The Indenture contains provisions for defeasance at any time of the
entire indebtedness of this Security or of certain restrictive covenants and
Events of Default with respect to this Security, in each case upon compliance
with certain conditions set forth in the Indenture.
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.
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 a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, 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 herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the
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appointment of a receiver or trustee or for any other remedy thereunder, unless
such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities of this series, the
Holders of not less than 25% in principal amount of the Securities of this
series at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered
the Trustee reasonable indemnity, and the Trustee shall not have received from
the Holders of a majority in principal amount of Securities of this series at
the time Outstanding a direction inconsistent with such request, and shall have
failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof or any premium or interest hereon on or after the
respective due dates expressed herein.
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 any premium and
interest 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 this Security 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 any
premium and interest 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 and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees. 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 Person 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.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple 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.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
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THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF.
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