Exhibit 4.23
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THIRTY-SEVENTH SUPPLEMENTAL
INDENTURE
DATED AS OF DECEMBER 15, 2002
TO
INDENTURE OF MORTGAGE
DATED AS OF JANUARY 1, 1941
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PENNSYLVANIA SUBURBAN WATER COMPANY, as successor by merger to
Philadelphia Suburban Water Company
TO
X.X. XXXXXX TRUST COMPANY, NATIONAL ASSOCIATION
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THIRTY-SEVENTH SUPPLEMENTAL INDENTURE
THIRTY-SEVENTH SUPPLEMENTAL INDENTURE dated as of December 15, 2002, by
and between PENNSYLVANIA SUBURBAN WATER COMPANY, a corporation duly organized
and existing under the laws of the Commonwealth of Pennsylvania (the "Company")
as successor by merger to the Philadelphia Suburban Water Company (the "Original
Company"), party of the first part, and X.X. XXXXXX TRUST COMPANY, NATIONAL
ASSOCIATION, a national banking association (the "Trustee"), party of the second
part.
WHEREAS, the Original Company heretofore duly executed and
delivered to The Pennsylvania Company for Insurances on Lives and Granting
Annuities, as trustee, an Indenture of Mortgage dated as of January 1, 1941 (the
"Original Indenture"), which by reference is hereby made a part hereof, and in
and by the Original Indenture the Original Company conveyed and mortgaged to
such trustee certain property therein described, to secure the payment of its
bonds to be generally known as its "First Mortgage Bonds" and to be issued under
the Original Indenture in one or more series as therein provided; and
WHEREAS, through a series of mergers, changes of names and
successions, X.X. Xxxxxx Trust Company, National Association, became the
successor trustee; such mergers, changes of name and successions not involving
any change in the title, powers, rights or duties of the trustee, as trustee
under the Original Indenture as supplemented at the respective dates thereof;
and
WHEREAS, the Original Company duly executed and delivered to
the Trustee thirty-four supplemental indentures supplemental to the Original
Indenture, and the Company duly executed and delivered to the Trustee a
Thirty-Fifth Supplemental Indenture dated as of January 1, 2002 (the
"Thirty-Fifth Supplemental Indenture") and a Thirty-Sixth Supplemental Indenture
dated as of June 1, 2002 (the "Thirty-Sixth Supplemental Indenture") so as to
subject certain additional property to the lien of the Original Indenture and to
provide for the creation of additional series of bonds; and
WHEREAS, pursuant to an Agreement and Plan of Merger and
Reorganization dated December 20, 2001, and effective on January 1, 2002, the
Original Company agreed to merge, in conjunction with its affiliated
corporations, Consumers Pennsylvania Water Company - Shenango Valley Division,
Consumers Pennsylvania Water Company - Roaring Creek Division, Consumers
Pennsylvania Water Company - Susquehanna Division, Waymart Water Company, Fawn
Lake Forrest Water Company, Western Utilities, Inc., and Northeastern Utilities,
Inc. (such affiliates referred to hereinafter as the "Merging Entities") with
and into the Company; and
WHEREAS, pursuant to the Thirty-Fifth Supplemental Indenture,
the Company agreed to assume the obligations of the Original Company under the
Original Indenture and all supplements thereto; and
WHEREAS, the Original Company has issued under the Original
Indenture, as supplemented at the respective dates of issue, forty-one series of
First Mortgage Bonds designated, respectively, as set forth in the following
table, the Original or Supplemental Indenture creating each series and the
principal amount of bonds thereof issued being indicated opposite the
designation of such series:
Designation Indenture Amount
----------- --------- ------
3 1/4% Series due 1971 Original $16,375,000
9 5/8% Series due 1975 Thirteenth Supplemental 10,000,000
9.15% Series due 1977 Fourteenth Supplemental 10,000,000
3% Series due 1978 First Supplemental 2,000,000
3 3/8% Series due 1982 Second Supplemental 4,000,000
3.90% Series due 1983 Third Supplemental 5,000,000
3 1/2% Series due 1986 Fourth Supplemental 6,000,000
4 1/2% Series due 1987 Fifth Supplemental 4,000,000
4 1/8% Series due 1988 Sixth Supplemental 4,000,000
5% Series due 0000 Xxxxxxx Supplemental 4,000,000
4 5/8% Series due 1991 Eighth Supplemental 3,000,000
4.70% Series due 1992 Ninth Supplemental 3,000,000
6 7/8% Series due 1993 Twelfth Supplemental 4,500,000
4.55% Series due 1994 Tenth Supplemental 4,000,000
10 1/8% Series due 1995 Sixteenth Supplemental 10,000,000
5 1/2% Series due 1996 Eleventh Supplemental 4,000,000
7 7/8% Series due 1997 Fifteenth Supplemental 5,000,000
8.44% Series due 1997 Twenty-Third Supplemental 12,000,000
9.20% Series due 2001 Seventeenth Supplemental 7,000,000
8.40% Series due 2002 Eighteenth Supplemental 10,000,000
5.95% Series due 2002 Twenty-Seventh Supplemental 4,000,000
12.45% Series due 2003 Twentieth Supplemental 10,000,000
13% Series due 2005 Twenty-First Supplemental 8,000,000
10.65% Series due 2006 Twenty-Second Supplemental 10,000,000
9.89% Series due 2008 Twenty-Fourth Supplemental 5,000,000
7.15% Series due 2008 Twenty-Eighth Supplemental 22,000,000
9.12% Series due 2010 Twenty-Fifth Supplemental 20,000,000
8 7/8% Series due 2010 Nineteenth Supplemental 8,000,000
6.50% Series due 2010 Twenty-Seventh Supplemental 3,200,000
9.17% Series due 2011 Twenty-Sixth Supplemental 5,000,000
9.93% Series due 2013 Twenty-Fourth Supplemental 5,000,000
9.97% Series due 2018 Twenty-Fourth Supplemental 5,000,000
9.17% Series due 2021 Twenty-Sixth Supplemental 8,000,000
9.29% Series due 2026 Twenty-Sixth Supplemental 12,000,000
1995 Medium Term Note
Series Twenty-Ninth Supplemental 77,000,000
7.72% Subseries A due 2025 15,000,000
6.82% Subseries B due 2005 10,000,000
6.89% Subseries C due 2015 12,000,000
2
6.99% Subseries D due 2006 10,000,000
7.47% Subseries E due 2003 10,000,000
6.83% Subseries F due 2003 10,000,000
7.06% Subseries G due 2004 10,000,000
6.35% Series due 2025 Thirtieth Supplemental 22,000,000
1997 Medium Term Note
Series Thirty-First Supplemental 65,000,000
6.75% Subseries A due 2007 10,000,000
6.30% Subseries B due 2002 10,000,000
6.14% Subseries C due 2008 10,000,000
5.80% Subseries D due 2003 10,000,000
5.85% Subseries E due 2004 10,000,000
6.00% Subseries F due 2004 15,000,000
6.00% Series due 2029 Thirty-Second Supplemental 25,000,000
1999 Medium Term Note
Series Thirty-Third Supplemental
7.40% Subseries A due 2005 15,000,000
7.40% Subseries B due 2005 11,000,000
6.21% Subseries C due 2011 15,000,000
9.53% Subseries D due 2019 4,000,000
6.375% Subseries E due 2023 14,000,000
8.26% Subseries F due 2022 1,500,000
9.50% Subseries G due 2006 1,440,000
9.22% Subseries H due 2019 2,534,480
8.32% Subseries I due 2022 3,500,000
8.14% Subseries J due 2025 4,000,000
6.00% Subseries K due 2030 18,360,000
5.35% Series due 2031 Thirty-Fourth Supplemental 30,000,000
5.55% Series due 2032 Thirty-Sixth Supplemental 25,000,000
WHEREAS, all of the bonds of each of said series are presently
outstanding other than the bonds listed on Exhibit A attached hereto and made a
part hereof; and
WHEREAS, the Original Indenture and said Supplemental
Indentures were duly recorded in the Commonwealth of Pennsylvania on the dates
and in the office for the Recording of Deeds for the following counties in the
Mortgage Books and at the pages indicated in the following table:
3
COUNTY
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Bucks Xxxxxxx Delaware Xxxxxxxxxx
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Date of
Indenture Recording Book Page Book Page Book Page Book Page
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Original 2/20/41 496 1 H-13.Vol.307 20 1034 1 1625 1
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First Supplemental 8/26/48 632 1 F-16.Vol.000 000 0000 169 2031 257
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Second Supplemental 7/1/52 768 438 18.Vol.425 186 1962 376 2360 517
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Third Supplemental 11/25/53 895 1 18.Vol.442 325 2052 1 2493 1
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Fourth Supplemental 1/9/56 1089 155 Z-20.Vol.499 1 2199 1 2722 425
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Fifth Supplemental 3/20/57 1181 316 B-22.Vol.000 000 0000 50 2850 335
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Sixth Supplemental 5/9/58 1254 1 G-23 201 2380 039 2952 289
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Seventh Supplemental 9/25/59 1332 509 B-25 109 2442 1 3090 249
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Eighth Supplemental 5/9/61 - - Z-26 17 2526 312 - -
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Eighth Supplemental 5/10/61 1409 225 - - - - 3249 289
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Ninth Supplemental 4/10/62 1458 372 G-28 126 2581 463 3307 169
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Tenth Supplemental 3/19/64 1568 1 M-30 967 2976 1043 3310 237
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Eleventh Supplemental 11/4/66 1655 695 Q-32 6682 762 223 3549 129
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Twelfth Supplemental 1/23/68 1691 531 N-33 219 2792 708 3542 315
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Thirteenth Supplemental 7/2/70 1763 1167 D-35 80 2850 301 3687 23
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Fourteenth Supplemental 11/5/70 1774 331 K-35 713 2858 3113 700 548
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Fifteenth Supplemental 12/11/72 0000 000 X-00 000 2926 550 3786 96
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Sixteenth Supplemental 5/28/75 1979 14 E-44 77 3005 511 4010 307
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Seventeenth Supplemental 12/18/77 2072 683 L-51 1 3072 43 5002 436
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4
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Bucks Chester Delaware Xxxxxxxxxx
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Date of
Indenture Recording Book Page Book Page Book Page Book Page
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Eighteenth Supplemental 4/29/77 2082 567 B-52 344 3078 728 5003 291
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Nineteenth Supplemental 6/23/80 2303 714 J-62 92 3261 293 5030 502
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Xxxxxxxxx Xxxxxxxxxxxx 0/0/00 0000 000 X-00 1 96 810 5662 1045
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Twenty-First Supplemental 8/27/85 2690 806 54 550 - - 5864 1347
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Twenty-First Supplemental 8/28/85 - - - - 264 159 - -
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Twenty-Second Supplemental 4/22/86 2774 160 263 275 326 592 5944 360
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Twenty-Third Supplemental 4/1/87 2960 693 - - - - - -
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Twenty-Third Supplemental 4/2/87 - - 680 337 447 1807 6115 602
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Twenty-Fourth Supplemental 7/25/88 3199 1095 1224 389 0593 0585 6324 143
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Twenty-Fifth Supplemental 1/12/90 0136 0250 1848 205 731 1571 6538 376
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Twenty-Sixth Supplemental 11/8/91 369 2190 2660 205 894 2241 6780 891
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Twenty-Seventh Supplemental 6/29/92 0487 1829 3055 182 0969 2023 6918 302
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Twenty-Eighth Supplemental 4/22/93 0652 1335 3542 1542 1081 0852 7112 0539
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Twenty-Ninth 3/30/95 1045 1872 3875 1368 1349 0829 7561 1155
Supplemental
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Thirtieth Supplemental 8/30/95 1111 0798 3932 0471 1393 2255 7631 0689
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Thirty-First Supplemental 7/11/97 1421 2196 4201 2133 1607 138 7968 779
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Thirty-Second Supplemental 10/6/99 1939 421 4646 642 1936 1207 8548 1067
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Thirty-Third Supplemental 11/30/99 1970 1573 4675 1272 1936 1207 8548 1067
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5
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Bucks Chester Delaware Xxxxxxxxxx
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Date of
Indenture Recording Book Page Book Page Book Page Book Page
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Thirty-Fourth Supplemental 10/31/01 2471 1207 5101 2142 2288 0174 9225 761
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Thirty-Fifth Supplemental 1/10/02 2541 765 5152 818 2329 1019 9314 1079
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Thirty-Sixth Supplemental 6/5/02 2731 1881 5296 356 2448 1862 9593 1416
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; and
WHEREAS, the Original Indenture and the Supplemental Indentures
indicated below were duly recorded in the Commonwealth of Pennsylvania on the
dates and in the office for the Recording of Deeds for Berks County in the
Mortgage Books and at the pages indicated in the following table:
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Indenture Date of Recording Book Page
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Original 8/16/99 3113 707
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Thirty-Second Supplement 10/6/99 3132 1510
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Thirty-Third Supplement 11/30/99 3149 1260
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Thirty-Fourth Supplement 10/31/01 3421 896
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Thirty-Fifth Supplement 1/10/02 3461 417
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Thirty-Sixth Supplement 6/4/02 3544 1357
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6
WHEREAS, in order to secure the Lien of the Original Indenture
on the properties of the Merging Entities, the Thirty-Fifth Supplemental
Indenture, with a true and correct copy of the Original Indenture (redacted to
delete property descriptions for counties in which such Original Indenture had
already been recorded), and the Thirty-Sixth Supplemental Indenture were also
recorded in the Commonwealth of Pennsylvania on the dates and in the office for
the Recording of Deeds for the following counties in the Mortgage Books and at
the pages indicated in the following table:
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Bradford Columbia Xxxxxxxx Xxxxxx
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Date of Date of Date of Date of
Indenture Recording Book Page Recording Book Page Recording Book Page Recording Book Page
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Thirty-Fifth 12/21/01 200115497 1688 744
Supplemental
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Thirty-Sixth 07/04/02 200207151
Supplemental
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Northumberland Pike Schuylkill Xxxxx
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Date of Date of Date of Date of
Indenture Recording Book Page Recording Book Page Recording Book Page Recording Book Page
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Thirty-Fifth 1404 246 1909 2328 1413 1 1911 1
Supplemental
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Thirty-Sixth 1445 028 1584 0259
Supplemental
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; and
WHEREAS, in addition to the property described in the Original
Indenture and the First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth,
Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth,
Seventeenth, Eighteenth, Nineteenth, Twentieth, Twenty-First, Twenty-Second,
Twenty-Third, Twenty-Fourth, Twenty-Fifth, Twenty-Sixth, Twenty-Seventh,
Twenty-Eighth, Twenty-Ninth, Thirtieth, Thirty-First, Thirty-Second,
Thirty-Third, Thirty-Fourth, Thirty-Fifth and Thirty-Sixth Supplemental
Indentures, the Company has acquired certain other property and desires to
confirm the lien of the Original Indenture thereon; and
7
WHEREAS, the lien of the Original Indenture, as supplemented,
has been perfected as a security interest under the Pennsylvania Uniform
Commercial Code by filing a financing statement in the office of the Secretary
of the Commonwealth; and
WHEREAS, the Company proposes to create under the Original
Indenture, as supplemented by this Thirty-Seventh Supplemental Indenture, two
new series of bonds to be designated "First Mortgage Bonds, 5.15% Series due
2032" (herein referred to as the "5.15% Series due 2032 ") to be limited in
aggregate principal amount to $25,000,000, to bear interest at the rate of 5.15%
per annum, and to mature on September 1, 2032, and "First Mortgage Bonds, 3.75%
Series due 2010" (herein referred to as the "3.75% Series due 2010" and,
together with the 5.15% Series due 2032, the "Bonds"), to be limited in
aggregate principal amount to $3,200,000, to bear interest at the rate of 3.75%
per annum, and to mature on June 1, 2010, both series of Bonds to be issued only
as registered bonds without coupons and to be dated the date of delivery
thereof; and
WHEREAS, in order to finance the cost of cleaning, re-lining
and related improvement of pipelines and related equipment and facilities
located in the Counties of Delaware, Xxxxxxxxxx and Bucks in Pennsylvania and
that are part of the Company's system for the distribution of water to its
customers, and related financing costs which are to be financed under a
Financing Agreement dated as of December 15, 2002 (the "Financing Agreement")
between the Company and the Delaware County Industrial Development Authority, a
Pennsylvania body politic and corporate (the "Authority"), and which are
described in Exhibit A thereto (which facilities, less any deletions therefor
and together with any additions, improvements and modifications thereto and
substitutions therefor made in accordance with the provisions of the Financing
Agreement are referred to as the "Facilities"), the Company has requested the
Authority to issue a new series of bonds to be known as the Authority's Water
Facilities Revenue Bonds (Pennsylvania Suburban Water Company Project), Series A
of 2002 in the aggregate principal amount of $25,000,000 (the "Authority Series
A Bonds"); and
WHEREAS, the Authority previously issued its Water Facilities
Revenue Bonds (Philadelphia Suburban Water Company Project), Series of 1992 (the
"1992 Bonds"), of which $[3,200,000] are currently outstanding to finance a
project (the "1980 Refunding Project") involving the refunding of the
Authority's Water Facilities Revenue Bonds (Philadelphia Suburban Water Company
Project), Series A of 1980 (the "1980 Bonds") in the aggregate principal amount
of $8,000,000 which were issued to finance certain facilities for the furnishing
of water on behalf of Philadelphia Suburban Water Company (predecessor to the
Company);
WHEREAS, the Company previously issued its bonds of the 6.50%
Series due 2010 (the "6.50% Series due 2010") under the Twenty-Seventh
Supplemental Indenture to secure the obligations of the Company to pay the costs
of the 1980 Refunding Project; and
WHEREAS, in order to finance the refunding of the 1992 Bonds,
the Company has requested the Authority to issue a new series of bonds to be
known as the Authority's Water Facilities Revenue Refunding Bonds (Pennsylvania
Suburban Water Company Project), Series B of 2002 in the aggregate principal
amount of $3,200,000 (the "Authority Series B Bonds" and, together with the
Authority Series A Bonds, the "Authority Bonds"); and
WHEREAS, in connection with the refunding of the 1992 Bonds,
the 6.50% Bonds due 2010 will be cancelled; and
WHEREAS, the Company proposes to issue the 5.15% Series due
2032 and the 3.75% Series due 2010 under the provisions of Article IV of the
Original Indenture, and will comply with the provisions thereof as well as with
other provisions of the Original Indenture and indentures supplemental thereto
in connection with the issuance of additional bonds so that it will be entitled
to procure the authentication and delivery of the Bonds; and
8
WHEREAS, the Authority Bonds are to be issued under a Trust
Indenture, dated as of December 15, 2002 (the "Authority Indenture"), between
the Authority and Wachovia Bank, National Association, as trustee (the
"Authority Trustee"); and
WHEREAS, the Bonds are to be issued by the Company to secure
the obligation of the Company to pay to or for the account of the Authority an
amount equal to the principal of, redemption premium, if any, and interest on
the Authority Bonds pursuant to the Financing Agreement; and
WHEREAS, the right, title and interest of the Authority in and
to the Financing Agreement and the payments thereunder and the security for such
payments are to be assigned by the Authority to the Authority Trustee, and the
Bonds are to be delivered by the Company on behalf of the Authority directly to
the Authority Trustee, as assignee of the Trustee, as security for the payment
of the principal of, redemption premium, if any, and interest on, the Authority
Bonds; and
WHEREAS, Article XVIII of the Original Indenture provides that
the Company, when authorized by resolution of its Board of Directors, may with
the Trustee enter into an indenture supplemental to the Original Indenture,
which thereafter shall form a part of the Original Indenture, for the purposes,
inter alia, of subjecting to the lien of the Original Indenture additional
property, of defining the covenants and provisions applicable to any bonds of
any series other than the 3 1/4% Series due 1971, of adding to the covenants and
agreements of the Company contained in the Original Indenture other covenants
and agreements thereafter to be observed by the Company, of surrendering any
right or power in the Original Indenture reserved to or conferred upon the
Company, and of making such provisions in regard to matters or questions arising
under the Original Indenture as may be necessary or desirable and not
inconsistent therewith; and
WHEREAS, the Company, by proper corporate action, has duly
authorized the creation of the 5.15% Series due 2032 and the 3.75% Series due
2010 (to be issued in accordance with the terms and provisions of the Original
Indenture and indentures supplemental thereto, including this Thirty-Seventh
Supplemental Indenture, and to be secured by said Original Indenture and
indentures supplemental thereto, including this Thirty-Seventh Supplemental
Indenture) and has further duly authorized the execution, delivery and recording
of this Thirty-Seventh Supplemental Indenture setting forth the terms and
provisions of the Bonds insofar as said terms and provisions are not set forth
in said Original Indenture; and
WHEREAS, the Bonds and the Trustee's certificate upon said
Bonds are to be substantially in the following form - the proper amount, names
of registered owners and numbers to be inserted therein, and such appropriate
insertions, omissions and changes to be made therein as may be required or
permitted by this Indenture to conform to any pertinent law or usage:
No. AR-1 $25,000,000
9
PENNSYLVANIA SUBURBAN WATER
COMPANY
(Incorporated under the Laws of the Commonwealth
of Pennsylvania)
First Mortgage Bond, 5.15% Series Due 2032
Pennsylvania Suburban Water Company (successor by merger to
Philadelphia Suburban Water Company), a corporation organized and existing under
the laws of the Commonwealth of Pennsylvania (hereinafter called the "Company",
which term shall include any successor corporation as defined in the Indenture
hereinafter referred to), for value received, hereby promises to pay to Delaware
County Industrial Development Authority or its registered assigns, on the 1st
day of September, 2032, at the designated office of X.X. Xxxxxx Trust Company,
National Association (hereinafter called the "Trustee") in Dallas, Texas, the
sum of Twenty-Five Million Dollars in such coin or currency of the United States
of America as at the time of payment is legal tender for the payment of public
and private debts and to pay interest thereon to the registered owner hereof by
draft or check of the Trustee mailed to such registered owner from the interest
payment date next preceding the date of the authentication of this Bond (or if
this Bond is authenticated after a Record Date as defined below and on or before
the succeeding interest payment date, from such succeeding interest payment
date, or if this Bond is authenticated prior to March 1, 2003, from the date
hereof) until the principal hereof shall become due and payable, at the rate of
five and 15/100ths percent (5.15%) per annum, payable semiannually in like coin
or currency on the first day of March and the first day of September in each
year, commencing March 1, 2003 and to pay interest on overdue principal
(including any overdue required or optional prepayment of principal) and
premium, if any, and, to the extent legally enforceable, on any overdue
installment of interest at a rate of 5.15% per annum after maturity whether by
acceleration or otherwise until paid.
The interest so payable will (except as otherwise provided in
the Thirty-Seventh Supplemental Indenture referred to herein) be calculated on
the basis of a 360-day year of twelve 30-day months and be paid to the person in
whose name this Bond (or a Bond or Bonds in exchange for which this Bond was
issued) is registered at the close of business on the fifteenth day of the
calendar month next preceding the month in which the interest payment date
occurs whether or not such day is a business day (a "Record Date") and
principal, premium, if any, and interest on this Bond shall be paid in
accordance with written payment instructions of the registered owner delivered
to the Trustee on or before such record date.
This Bond is one of a duly authorized issue of bonds of the
Company known as its First Mortgage Bonds, issued and to be issued without
limitation as to aggregate principal amount except as set forth in the Indenture
hereinafter mentioned in one or more series and equally secured (except insofar
as a sinking fund or other similar fund established in accordance with the
provisions of the Indenture may afford additional security for the bonds of any
specific series) by an Indenture of Mortgage (herein called the "Indenture")
10
dated as of January 1, 1941, executed by the Philadelphia Suburban Water Company
(now Pennsylvania Suburban Water Company as successor by merger) to The
Pennsylvania Company for Insurances on Lives and Granting Annuities (succeeded
as trustee by X.X. Xxxxxx Trust Company, National Association), as Trustee, to
which Indenture and all indentures supplemental thereto reference is hereby made
for a description of the property mortgaged and pledged, the nature and extent
of the security, the rights of the holders and registered owners of the bonds
and of the Trustee in respect of such security, and the terms and conditions
under which the bonds are and are to be secured and may be issued under the
Indenture; but neither the foregoing reference to the Indenture nor any
provision of this Bond or of the Indenture or of any indenture supplemental
thereto shall affect or impair the obligation of the Company, which is absolute
and unconditional, to pay at the stated or accelerated maturity herein and in
the Indenture provided, the principal of and premium, if any, and interest on
this Bond as herein provided. As provided in the Indenture, the bonds may be
issued in series for various principal amounts, may bear different dates and
mature at different times, may bear interest at different rates and may
otherwise vary as in the Indenture provided or permitted. This Bond is one of
the Bonds described in an indenture supplemental to said Indenture known as the
"Thirty-Seventh Supplemental Indenture" dated as of December 15, 2002, and
designated therein as "First Mortgage Bonds, 5.15% Series due 2032" (the "5.15%
Series due 2032").
Concurrently herewith the Company is issuing its "First
Mortgage Bonds, 3.75% Series due 2010" in the aggregate principal amount of
$3,200,000 (the "3.75% Series due 2010" and, together with the 5.15% Series due
2032, the "Bonds").
To the extent permitted by and as provided in the Indenture,
modifications or alterations of the Indenture, or of any indenture supplemental
thereto, and of the rights and obligations of the Company and of the holders and
registered owners of bonds issued and to be issued thereunder may be made with
the consent of the Company by an affirmative vote of the holders and registered
owners of not less than 75% in principal amount of bonds then outstanding under
the Indenture and entitled to vote, at a meeting of the bondholders called and
held as provided in the Indenture, and, in case one or more but less than all of
the series of bonds then outstanding under the Indenture are so affected, by an
affirmative vote of the holders and registered owners of not less than 75% in
principal amount of bonds of any series then outstanding under the Indenture and
entitled to vote on and affected by such modification or alteration, or by the
written consent of the holders and registered owners of such percentages of
bonds; provided, however, that no such modification or alteration shall be made
which shall reduce the percentage of bonds the consent of the holders or
registered owners of which is required for any such modification or alteration
or which shall affect the terms of payment of the principal of or interest on
the bonds, or permit the creation by the Company of any lien prior to or on a
parity with the lien of the Indenture with respect to any property subject to
the lien of the Indenture as a first mortgage lien thereon, or which shall
affect the rights of the holders or registered owners of less than all of the
bonds of any series affected thereby.
11
The Bonds have been issued by the Company to secure the
obligation of the Company to pay to or for the account of the Authority (defined
below) an amount equal to the principal, premium, if any, of, and interest on,
the Authority Bonds (defined below) pursuant to the Financing Agreement (the
"Financing Agreement") dated as of December 15, 2002, between the Delaware
County Industrial Development Authority, a Pennsylvania body politic and
corporate (the "Authority"), and the Company, which Authority Bonds are being
issued to finance (1) the cost of cleaning, re-lining and related improvement of
pipelines and related equipment and facilities located in the Counties of
Delaware, Xxxxxxxxxx and Bucks in Pennsylvania and that are part of the
Company's system for the distribution of water to its customers, and related
financing costs which are to be financed under a Financing Agreement dated as of
December 15, 2002 (the "Financing Agreement") between the Company and the
Delaware County Industrial Development Authority, a Pennsylvania body politic
and corporate (the "Authority"), and which are described in Exhibit A thereto
(which facilities, less any deletions therefor and together with any additions,
improvements and modifications thereto and substitutions therefor made in
accordance with the provisions of the Financing Agreement are referred to as the
"Facilities"), and (2) the refunding of the Authority's Water Facilities Revenue
Bonds (Philadelphia Suburban Water Company Project), Series of 1992 previously
issued by the Authority on behalf of Philadelphia Suburban Water Company (the
"Refunding Project"). The Facilities are to be financed through the sale of the
Authority's Water Facilities Revenue Bonds (Pennsylvania Suburban Water Company
Project), Series A of 2002, in the aggregate principal amount of $25,000,000 due
September 1, 2032 (the "Authority Series A Bonds") and bearing interest at 5.15%
per annum, and the Refunding Project is to be financed through the sale of the
Authority's Water Facilities Revenue Refunding Bonds (Pennsylvania Suburban
Water Company Project), Series B of 2002 (the "Authority Series B Bonds" and,
together with the Authority Series A Bonds, the "Authority Bonds").
The Authority Bonds are to be issued under a Trust Indenture,
dated as of December 15, 2002 (the "Authority Indenture"), between the Authority
and Wachovia Bank, National Association, as trustee (the "Authority Trustee").
The right, title and interest of the Authority in and to the Financing Agreement
and the payments thereunder and the security for such payments have been
assigned by the Authority to the Authority Trustee, and the Bonds have been
delivered by the Company on behalf of the Authority directly to the Authority
Trustee, as assignee, as security for the payment of the principal of, and
premium, if any, and interest on, the Authority Bonds. The Authority Trustee may
not sell, assign or otherwise transfer the Bonds except for a transfer of the
entire outstanding principal amount thereof to its successor as Trustee under
the Authority Indenture, which successor and each subsequent successor shall
hold such Bonds subject to the same restriction on transfer.
12
In the event any Authority Bonds shall be purchased by the
Company and cancelled pursuant to the Authority Indenture, Bonds corresponding
in principal amount to the Authority Bonds so purchased and cancelled shall be
deemed to be paid in full, and in the event and to the extent the principal of,
and premium, if any, or interest on, any Authority Bonds is paid out of funds
held by the Authority Trustee other than payments on Bonds, the corresponding
payment of the principal of and premium, if any, or interest on, an aggregate
principal amount of Bonds shall be deemed to have been satisfied.
In the event this Bond shall be deemed to have been paid in
full, this Bond shall be surrendered to the Trustee for cancellation. In the
event this Bond shall be deemed to have been paid in part, this Bond shall be
presented to the Trustee for notation hereon of the payment of the portion of
the principal hereof so deemed to have been paid.
The Bonds are redeemable only as follows:
(a) The 5.15% Series due 2032 are subject to redemption prior to
maturity on or after September 1, 2013 by the Company, to the extent that the
Authority Series A Bonds are called for redemption under Section 7.01(a) of the
Authority Indenture, and then out of moneys deposited with or held by the
Trustee for such purpose, as a whole or in part, at any time in the manner
described below, at the redemption price of 100% of the principal amount of the
Bonds to be redeemed, plus interest accrued thereon to the date fixed for
redemption.
(b) The Bonds are also subject to mandatory redemption by the Company
in whole if the Trustee shall receive a written demand from the Authority
Trustee for redemption of all such Bonds held by the Authority Trustee stating
that an "Event of Default" as defined in Section 9.01(a) of the Authority
Indenture has occurred and is continuing and that payment of the principal of
the Authority Bonds has been accelerated pursuant to Section 9.01(b) of the
Authority Indenture, provided that at the time of notice of such redemption as
provided in Section 2 of Article V of the Original Indenture (i) said written
demand shall not have been withdrawn by the Authority Trustee, and (ii) no event
of default under Section 1 of Article XI of the Original Indenture shall have
occurred and be continuing.
If this Bond or any portion hereof is called for redemption
and payment thereof is duly provided for as specified in the Indenture, interest
shall cease to accrue hereon or on such portion, as the case may be, from and
after the date fixed for redemption.
The principal hereof may be declared or may become due prior
to its maturity date on the conditions, in the manner and with the effect set
forth in the Indenture upon the happening of an event of default, as in the
Indenture provided; subject, however, to the right, under certain circumstances,
of the registered owners of a majority in principal amount of Bonds outstanding
to annul such declaration.
This Bond is transferable by the registered owner hereof in
person or by attorney duly authorized in writing, on books of the Company to be
kept for that purpose at the designated office of the Trustee in Dallas, Texas
upon surrender hereof for cancellation at such office and upon presentation of a
written instrument of transfer duly executed, and thereupon the Company shall
issue in the name of the transferee or transferees, and the Trustee shall
authenticate and deliver, a new Bond or Bonds in authorized denominations, of
equal aggregate unpaid principal amount. Any such transfer or exchange shall be
subject to the terms and conditions and to the payment of the charges specified
in the Indenture.
The Company and the Trustee may deem and treat the registered
owner of this Bond as the absolute owner hereof for the purpose of receiving
payment of or on account of the principal hereof and the interest hereon, and
for all other purposes, and shall not be affected by any notice to the contrary.
13
No recourse shall be had for the payment of the principal of
or interest on this Bond or for any claim based hereon or otherwise in respect
hereof or of the Indenture or of any indenture supplemental thereto against any
incorporator or any past, present or future stockholder, officer or director of
the Company or of any predecessor or successor corporation, as such, either
directly or through the Company or through any such predecessor or successor
corporation or through any receiver or trustee in bankruptcy, by virtue of any
constitutional provision, statute or rule of law or equity, or by the
enforcement of any assessment or penalty or otherwise; all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released by every holder or registered owner hereof, as
more fully provided in the Indenture.
This Bond shall not be entitled to any benefit under the
Indenture or any indenture supplemental thereto, or become valid or obligatory
for any purpose, until X.X. Xxxxxx Trust Company, National Association, as
Trustee under the Indenture, or a successor trustee thereunder, shall have
signed the certificate of authentication endorsed hereon.
(Form of Trustee's Certificate)
This Bond is one of the Bonds, of the series designated
therein, referred to in the within-mentioned Thirty-Seventh Supplemental
Indenture.
X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION
By:__________________________
Authorized Signer
IN WITNESS WHEREOF, Pennsylvania Suburban Water Company has
caused this Bond to be signed by its President or a Vice President and its
corporate seal to be hereto affixed and attested by its Secretary or an
Assistant Secretary, and this Bond to be dated December 31, 2002.
Attest: PENNSYLVANIA SUBURBAN WATER COMPANY
By:
--------------------------- -------------------------------
(Assistant) Secretary Vice President and Treasurer
14
No. BR-1 $3,200,000
PENNSYLVANIA SUBURBAN WATER
COMPANY
(Incorporated under the Laws of the Commonwealth
of Pennsylvania)
First Mortgage Bond, 3.75% Series Due 2010
Pennsylvania Suburban Water Company (successor by merger to
Philadelphia Suburban Water Company), a corporation organized and existing under
the laws of the Commonwealth of Pennsylvania (hereinafter called the "Company",
which term shall include any successor corporation as defined in the Indenture
hereinafter referred to), for value received, hereby promises to pay to Delaware
County Industrial Development Authority or its registered assigns, on the 1st
day of June, 2010, at the designated office of X.X. Xxxxxx Trust Company,
National Association (hereinafter called the "Trustee") in Dallas, Texas, the
sum of Three Million Two Hundred Thousand Dollars in such coin or currency of
the United States of America as at the time of payment is legal tender for the
payment of public and private debts and to pay interest thereon to the
registered owner hereof by draft or check of the Trustee mailed to such
registered owner from the interest payment date next preceding the date of the
authentication of this Bond (or if this Bond is authenticated after a Record
Date as defined below and on or before the succeeding interest payment date,
from such succeeding interest payment date, or if this Bond is authenticated
prior to June 1, 2003, from the date hereof) until the principal hereof shall
become due and payable, at the rate of three and 75/100ths percent (3.75%) per
annum, payable semiannually in like coin or currency on the first day of January
and the first day of June in each year, commencing June 1, 2003 and to pay
interest on overdue principal (including any overdue required or optional
prepayment of principal) and premium, if any, and, to the extent legally
enforceable, on any overdue installment of interest at a rate of 3.75% per annum
after maturity whether by acceleration or otherwise until paid.
The interest so payable will (except as otherwise provided in
the Thirty-Seventh Supplemental Indenture referred to herein) be calculated on
the basis of a 360-day year of twelve 30-day months and be paid to the person in
whose name this Bond (or a Bond or Bonds in exchange for which this Bond was
issued) is registered at the close of business on the fifteenth day of the
calendar month next preceding the month in which the interest payment date
occurs whether or not such day is a business day (a "Record Date") and
principal, premium, if any, and interest on this Bond shall be paid in
accordance with written payment instructions of the registered owner delivered
to the Trustee on or before such record date.
15
This Bond is one of a duly authorized issue of bonds of the
Company known as its First Mortgage Bonds, issued and to be issued without
limitation as to aggregate principal amount except as set forth in the Indenture
hereinafter mentioned in one or more series and equally secured (except insofar
as a sinking fund or other similar fund established in accordance with the
provisions of the Indenture may afford additional security for the bonds of any
specific series) by an Indenture of Mortgage (herein called the "Indenture")
dated as of January 1, 1941, executed by the Philadelphia Suburban Water Company
(now Pennsylvania Suburban Water Company as successor by merger) to The
Pennsylvania Company for Insurances on Lives and Granting Annuities (succeeded
as trustee by X.X. Xxxxxx Trust Company, National Association), as Trustee, to
which Indenture and all indentures supplemental thereto reference is hereby made
for a description of the property mortgaged and pledged, the nature and extent
of the security, the rights of the holders and registered owners of the bonds
and of the Trustee in respect of such security, and the terms and conditions
under which the bonds are and are to be secured and may be issued under the
Indenture; but neither the foregoing reference to the Indenture nor any
provision of this Bond or of the Indenture or of any indenture supplemental
thereto shall affect or impair the obligation of the Company, which is absolute
and unconditional, to pay at the stated or accelerated maturity herein and in
the Indenture provided, the principal of and premium, if any, and interest on
this Bond as herein provided. As provided in the Indenture, the bonds may be
issued in series for various principal amounts, may bear different dates and
mature at different times, may bear interest at different rates and may
otherwise vary as in the Indenture provided or permitted. This Bond is one of
the Bonds described in an indenture supplemental to said Indenture known as the
"Thirty-Seventh Supplemental Indenture" dated as of December 15, 2002, and
designated therein as "First Mortgage Bonds, 3.75% Series due 2010" (the "3.75%
Series due 2010").
Concurrently herewith the Company is issuing its "First
Mortgage Bonds, 5.15% Series due 2032" in the aggregate principal amount of
$25,000,000 (the "5.15% Series due 2032" and, together with the 3.75% Series due
2010, the "Bonds").
To the extent permitted by and as provided in the Indenture,
modifications or alterations of the Indenture, or of any indenture supplemental
thereto, and of the rights and obligations of the Company and of the holders and
registered owners of bonds issued and to be issued thereunder may be made with
the consent of the Company by an affirmative vote of the holders and registered
owners of not less than 75% in principal amount of bonds then outstanding under
the Indenture and entitled to vote, at a meeting of the bondholders called and
held as provided in the Indenture, and, in case one or more but less than all of
the series of bonds then outstanding under the Indenture are so affected, by an
affirmative vote of the holders and registered owners of not less than 75% in
principal amount of bonds of any series then outstanding under the Indenture and
entitled to vote on and affected by such modification or alteration, or by the
written consent of the holders and registered owners of such percentages of
bonds; provided, however, that no such modification or alteration shall be made
which shall reduce the percentage of bonds the consent of the holders or
registered owners of which is required for any such modification or alteration
or which shall affect the terms of payment of the principal of or interest on
the bonds, or permit the creation by the Company of any lien prior to or on a
parity with the lien of the Indenture with respect to any property subject to
the lien of the Indenture as a first mortgage lien thereon, or which shall
affect the rights of the holders or registered owners of less than all of the
bonds of any series affected thereby.
16
The Bonds have been issued by the Company to secure the
obligation of the Company to pay to or for the account of the Authority (defined
below) an amount equal to the principal, premium, if any, of, and interest on,
the Authority Bonds (defined below) pursuant to the Financing Agreement (the
"Financing Agreement") dated as of December 15, 2002, between the Delaware
County Industrial Development Authority, a Pennsylvania body politic and
corporate (the "Authority"), and the Company, which Authority Bonds are being
issued to finance (1) cleaning, re-lining and related improvement of pipelines
and related equipment and facilities located in the Counties of Delaware,
Xxxxxxxxxx and Bucks in Pennsylvania and that are part of the Company's system
for the distribution of water to its customers, and related financing costs
which are to be financed under a Financing Agreement dated as of December 15,
2002 (the "Financing Agreement") between the Company and the Delaware County
Industrial Development Authority, a Pennsylvania body politic and corporate (the
"Authority"), and which are described in Exhibit A thereto (which facilities,
less any deletions therefor and together with any additions, improvements and
modifications thereto and substitutions therefor made in accordance with the
provisions of the Financing Agreement are referred to as the "Facilities"), and
(2) the refunding of the Authority's Water Facilities Revenue Bonds
(Philadelphia Suburban Water Company Project), Series of 1992 previously issued
by the Authority on behalf of Philadelphia Suburban Water Company (the
"Refunding Project"). The Facilities are to be financed through the sale of the
Authority's Water Facilities Revenue Bonds (Pennsylvania Suburban Water Company
Project), Series A of 2002, in the aggregate principal amount of $25,000,000 due
September 1, 2032 (the "Authority Series A Bonds") and bearing interest at 5.15%
per annum, and the Refunding Project is to be financed through the sale of the
Authority's Water Facilities Revenue Refunding Bonds (Pennsylvania Suburban
Water Company Project), Series B of 2002 (the "Authority Series B Bonds" and,
together with the Authority Series A Bonds, the "Authority Bonds").
The Authority Bonds are to be issued under a Trust Indenture,
dated as of December 15, 2002 (the "Authority Indenture"), between the Authority
and Wachovia Bank, National Association, as trustee (the "Authority Trustee").
The right, title and interest of the Authority in and to the Financing Agreement
and the payments thereunder and the security for such payments have been
assigned by the Authority to the Authority Trustee, and the Bonds have been
delivered by the Company on behalf of the Authority directly to the Authority
Trustee, as assignee, as security for the payment of the principal of, and
premium, if any, and interest on, the Authority Bonds. The Authority Trustee may
not sell, assign or otherwise transfer the Bonds except for a transfer of the
entire outstanding principal amount thereof to its successor as Trustee under
the Authority Indenture, which successor and each subsequent successor shall
hold such Bonds subject to the same restriction on transfer.
In the event any Authority Bonds shall be purchased by the
Company and cancelled pursuant to the Authority Indenture, Bonds corresponding
in principal amount to the Authority Bonds so purchased and cancelled shall be
deemed to be paid in full, and in the event and to the extent the principal of,
and premium, if any, or interest on, any Authority Bonds is paid out of funds
held by the Authority Trustee other than payments on Bonds, the corresponding
payment of the principal of and premium, if any, or interest on, an aggregate
principal amount of Bonds shall be deemed to have been satisfied.
17
In the event this Bond shall be deemed to have been paid in
full, this Bond shall be surrendered to the Trustee for cancellation. In the
event this Bond shall be deemed to have been paid in part, this Bond shall be
presented to the Trustee for notation hereon of the payment of the portion of
the principal hereof so deemed to have been paid.
The Bonds are redeemable only as follows:
(a) The Bonds are subject to mandatory redemption as a whole or in part
at any time prior to maturity should the Company be required to make payments
with respect to the Authority Bonds pursuant to the provisions of Section
7.02(a) of the Financing Agreement, or Sections 7.01(b)of the Authority
Indenture, if the Trustee shall receive a notice from the Authority or the
Authority Trustee that the Bonds are subject to mandatory redemption in
accordance with any of such provisions.
(b) The Bonds are also subject to mandatory redemption by the Company
in whole if the Trustee shall receive a written demand from the Authority
Trustee for redemption of all such Bonds held by the Authority Trustee stating
that an "Event of Default" as defined in Section 9.01(a) of the Authority
Indenture has occurred and is continuing and that payment of the principal of
the Authority Bonds has been accelerated pursuant to Section 9.01(b) of the
Authority Indenture, provided that at the time of notice of such redemption as
provided in Section 2 of Article V of the Original Indenture (i) said written
demand shall not have been withdrawn by the Authority Trustee, and (ii) no event
of default under Section 1 of Article XI of the Original Indenture shall have
occurred and be continuing.
(c) The 3.75% Series due 2010 are not subject to optional redemption.
If this Bond or any portion hereof is called for redemption
and payment thereof is duly provided for as specified in the Indenture, interest
shall cease to accrue hereon or on such portion, as the case may be, from and
after the date fixed for redemption.
The principal hereof may be declared or may become due prior
to its maturity date on the conditions, in the manner and with the effect set
forth in the Indenture upon the happening of an event of default, as in the
Indenture provided; subject, however, to the right, under certain circumstances,
of the registered owners of a majority in principal amount of Bonds outstanding
to annul such declaration.
This Bond is transferable by the registered owner hereof in
person or by attorney duly authorized in writing, on books of the Company to be
kept for that purpose at the designated office of the Trustee in Dallas, Texas
upon surrender hereof for cancellation at such office and upon presentation of a
written instrument of transfer duly executed, and thereupon the Company shall
issue in the name of the transferee or transferees, and the Trustee shall
authenticate and deliver, a new Bond or Bonds in authorized denominations, of
equal aggregate unpaid principal amount. Any such transfer or exchange shall be
subject to the terms and conditions and to the payment of the charges specified
in the Indenture.
18
The Company and the Trustee may deem and treat the registered
owner of this Bond as the absolute owner hereof for the purpose of receiving
payment of or on account of the principal hereof and the interest hereon, and
for all other purposes, and shall not be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of
or interest on this Bond or for any claim based hereon or otherwise in respect
hereof or of the Indenture or of any indenture supplemental thereto against any
incorporator or any past, present or future stockholder, officer or director of
the Company or of any predecessor or successor corporation, as such, either
directly or through the Company or through any such predecessor or successor
corporation or through any receiver or trustee in bankruptcy, by virtue of any
constitutional provision, statute or rule of law or equity, or by the
enforcement of any assessment or penalty or otherwise; all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released by every holder or registered owner hereof, as
more fully provided in the Indenture.
This Bond shall not be entitled to any benefit under the
Indenture or any indenture supplemental thereto, or become valid or obligatory
for any purpose, until X.X. Xxxxxx Trust Company, National Association, as
Trustee under the Indenture, or a successor trustee thereunder, shall have
signed the certificate of authentication endorsed hereon.
IN WITNESS WHEREOF, Pennsylvania Suburban Water Company has
caused this Bond to be signed by its President or a Vice President and its
corporate seal to be hereto affixed and attested by its Secretary or an
Assistant Secretary, and this Bond to be dated December 31, 2002.
Attest: PENNSYLVANIA SUBURBAN WATER COMPANY
By:
--------------------------- -----------------------------------
(Assistant) Secretary Vice President and Treasurer
(Form of Trustee's Certificate)
This Bond is one of the Bonds, of the series designated
therein, referred to in the within-mentioned Thirty-Seventh Supplemental
Indenture.
X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION
By:__________________________
Authorized Signer
19
and;
WHEREAS, all acts and things necessary to make the Bonds, when
executed by the Company and authenticated and delivered by the Trustee as in
this Thirty-Seventh Supplemental Indenture provided and issued by the Company,
valid, binding and legal obligations of the Company, and this Thirty-Seventh
Supplemental Indenture a valid and enforceable supplement to said Original
Indenture, have been done, performed and fulfilled, and the execution of this
Thirty-Seventh Supplemental Indenture has been in all respects duly authorized;
and
NOW, THEREFORE, THIS THIRTY-SEVENTH SUPPLEMENTAL INDENTURE
WITNESSETH: That, in order to secure the payment of the principal and interest
of all bonds issued under the Original Indenture and all indentures supplemental
thereto, according to their tenor and effect, and according to the terms of the
Original Indenture and of any indenture supplemental thereto, and to secure the
performance of the covenants and obligations in said bonds and in the Original
Indenture and any indenture supplemental thereto respectively contained, and to
provide for the proper issuing, conveying and confirming unto the Trustee, its
successors in said trust and its and their assigns forever, upon the trusts and
for the purposes expressed in the Original Indenture and in any indenture
supplemental thereto, all and singular the estates, property and franchises of
the Company thereby mortgaged or intended so to be, the Company, for and in
consideration of the premises and of the sum of One Dollar ($1.00) in hand paid
by the Trustee to the Company upon the execution and delivery of this
Thirty-Seventh Supplemental Indenture, receipt whereof is hereby acknowledged,
and of other good and valuable consideration, and intending to be legally bound,
has granted, bargained, sold, aliened, enfeoffed, released and confirmed and by
these presents does grant, bargain, sell, alien, enfeoff, release and confirm
unto X.X. Xxxxxx Trust Company, National Association, as Trustee, and to its
successors in said trust and its and their assigns forever:
All and singular the premises, property, assets, rights and
franchises of the Company, whether now or hereafter owned, constructed or
acquired, of whatever character and wherever situated (except as herein
expressly excepted), including among other things the following, but reference
to or enumeration of any particular kinds, classes, or items of property shall
not be deemed to exclude from the operation and effect of the Original Indenture
or any indenture supplemental thereto any kind, class or item not so referred to
or enumerated:
I.
REAL ESTATE AND WATER RIGHTS.
The real estate described in the deeds from the grantors named
in Exhibit B hereto, dated and recorded as therein set forth, and any other real
estate and water rights acquired since the date of the Thirty-Sixth Supplemental
Indenture.
20
II.
BUILDINGS AND EQUIPMENT.
All mains, pipes, pipe lines, service pipes, buildings,
improvements, standpipes, reservoirs, xxxxx, flumes, sluices, canals, basins,
cribs, machinery, conduits, hydrants, water works, plants and systems, tanks,
shops, structures, purification systems, pumping stations, fixtures, engines,
boilers, pumps, meters and equipment which are now owned or may hereafter be
acquired by the Company (except as herein expressly excepted), including all
improvements, additions and extensions appurtenant to any real or fixed property
now or hereafter subject to the lien of the Original Indenture or any indenture
supplemental thereto which are used or useful in connection with the business of
the Company as a water company or as a water utility, whether any of the
foregoing property is now owned or may hereafter be acquired by the Company.
It is hereby declared by the Company that all property of the
kinds described in the next preceding paragraph, whether now owned or hereafter
acquired, has been or is or will be owned or acquired with the intention of
using the same in carrying on the business or branches of the business of the
Company, and it is hereby declared that it is the intention of the Company that
all thereof (except property hereinafter specifically excepted) shall be subject
to the lien of the Original Indenture.
It is agreed by the Company that so far as may be permitted by
law, tangible personal property now owned or hereafter acquired by the Company,
except such as is hereafter expressly excepted from the lien hereof, shall be
deemed to be and construed as fixtures and appurtenances to the real property of
the Company.
III.
FRANCHISES AND RIGHTS OF WAY.
All the corporate and other franchises of the Company, all
water and flowage rights, riparian rights, easements and rights of way, and all
permits, licenses, rights, grants, privileges and immunities, and all renewals,
extensions, additions or modifications of any of the foregoing, whether the same
or any thereof, or any renewals, extensions, additions or modifications thereof,
are now owned or may hereafter be acquired, owned, held, or enjoyed by the
Company.
IV.
AFTER ACQUIRED PROPERTY.
All real and fixed property and all other property of the
character hereinabove described which the Company may hereafter acquire.
21
TOGETHER WITH all and singular the tenements, hereditaments
and appurtenances belonging or in any way appertaining to the aforesaid property
or any part thereof, with the reversion and reversions, remainder and
remainders, tolls, rents, revenues, issues, income, product and profits thereof,
and all the estate, right, title, interest and claim whatsoever, at law as well
as in equity, which the Company now has or may hereafter acquire in and to the
aforesaid premises, property, rights and franchises and every part and parcel
thereof.
EXCEPTING AND RESERVING, HOWEVER, certain premises, not used
or useful in the supplying of water by the Company, expressly excepted and
reserved from the lien of the Original Indenture and not subject to the terms
thereof.
AND ALSO SAVING AND EXCEPTING from the property hereby
mortgaged and pledged, all of the following property (whether now owned by the
Company or hereafter acquired by it): All bills, notes and accounts receivable,
cash on hand and in banks, contracts, choses in action and leases to others (as
distinct from the property leased and without limiting any rights of the Trustee
with respect thereto under any of the provisions of the Original Indenture or of
any indenture supplemental thereto), all bonds, obligations, evidences of
indebtedness, shares of stock and other securities, and certificates or
evidences of interest therein, all automobiles, motor trucks, and other like
automobile equipment and all furniture, and all equipment, materials, goods,
merchandise and supplies acquired for the purpose of sale in the ordinary course
of business or for consumption in the operation of any properties of the Company
other than any of the foregoing which may be specifically transferred or
assigned to or pledged or deposited with the Trustee hereunder or required by
the provisions of the Original Indenture or any indenture supplemental thereto
so to be; provided, however, that if, upon the happening of a completed default,
as specified in Section 1 of Article XI of the Original Indenture, the Trustee
or any receiver appointed hereunder shall enter upon and take possession of the
mortgaged property, the Trustee or any such receiver may, to the extent
permitted by law, at the same time likewise take possession of any and all of
the property described in this paragraph then on hand and any and all other
property of the Company then on hand, not described or referred to in the
foregoing granting clauses, which is used or useful in connection with the
business of the Company as a water company or as a water utility, and use and
administer the same to the same extent as if such property were part of the
mortgaged property, unless and until such completed default shall be remedied or
waived and possession of the mortgaged property restored to the Company, its
successors or assigns.
SUBJECT, HOWEVER, to the exceptions, reservations and matters
hereinabove and in the Original Indenture recited, to releases executed since
the date of the Original Indenture in accordance with the provisions thereof, to
existing leases, to easements and rights of way for pole lines and electric
transmission lines and other similar encumbrances and restrictions which the
Company hereby certifies, in its judgment, do not impair the use of said
property by the Company in its business, to liens existing on or claims against,
and rights in and relating to, real estate acquired for right-of-way purposes,
to taxes and assessments not delinquent, to alleys, streets and highways that
may run across or encroach upon said lands, to liens, if any, incidental to
construction, and to Permitted Liens, as defined in the Original Indenture; and,
with respect to any property which the Company may hereafter acquire, to all
terms, conditions, agreements, covenants, exceptions and reservations expressed
or provided in such deeds and other instruments, respectively, under and by
virtue of which the Company shall hereafter acquire the same and to any and all
liens existing thereon at the time of such acquisition.
22
TO HAVE AND TO HOLD, all and singular the property, rights,
privileges and franchises hereby conveyed, transferred or pledged or intended so
to be unto the Trustee and its successors in the trust heretofore and hereby
created, and its and their assigns forever.
IN TRUST NEVERTHELESS, for the equal pro rata benefit and
security of each and every entity who may be or become the holders of bonds and
coupons secured by the Original Indenture or by any indenture supplemental
thereto, or both, without preference, priority or distinction as to lien or
otherwise of any bond or coupon over or from any other bond or coupon, so that
each and every of said bonds and coupons issued or to be issued, of whatsoever
series, shall have the same right, lien and privilege under the Original
Indenture and all indentures supplemental thereto and shall be equally secured
hereby and thereby, with the same effect as if said bonds and coupons had all
been made, issued and negotiated simultaneously on the date thereof; subject,
however, to the provisions with reference to extended, transferred or pledged
coupons and claims for interest contained in the Original Indenture and subject
to any sinking or improvement fund or maintenance deposit provisions, or both,
for the benefit of any particular series of bonds.
IT IS HEREBY COVENANTED, DECLARED AND AGREED, by and between
the parties hereto, that all such bonds and coupons are to be authenticated,
delivered and issued, and that all property subject or to become subject hereto
is to be held subject to the further covenants, conditions, uses and trusts
hereinafter set forth, and the Company, for itself and its successors and
assigns, does hereby covenant and agree to and with the Trustee and its
successor or successors in said trust, for the benefit of those who shall hold
said bonds and coupons, or any of them, issued under this Indenture or any
indenture supplemental hereto, or both, as follows:
23
ARTICLE I.
Form, Authentication and Delivery of the Bonds;
Redemption Provisions
---------------------
SECTION 1. There shall be a forty-second series of bonds,
limited in aggregate principal amount to $25,000,000 designated as "Pennsylvania
Suburban Water Company, First Mortgage Bonds, 5.15% Series due 2032", and a
forty-third series of Bonds, limited in aggregate principal amount to $3,200,000
designated as "Pennsylvania Suburban Water Company, First Mortgage Bonds, 3.75%
Series due 2010".
Interest on the 5.15% Series due 2032 shall be payable semiannually on March 1
and September 1 of each year (each an "interest payment date"), commencing March
1, 2003; interest on the 3.75 Series due 2010 shall be payable semiannually on
January 1 and June 1 of each year (each an "interest payment date"), commencing
June 1, 2003. Each Bond shall be dated the date of its authentication and shall
bear interest from the interest payment date next preceding its date of
authentication, unless authenticated after a record date and on or before the
succeeding interest payment date, in which case it shall bear interest from such
succeeding interest payment date, or, unless authenticated on or prior to the
record date for the first interest payment date for the Bonds, in which case it
shall bear interest from the date of original issuance of the Bonds; provided,
however, that, if at the time of authentication of any Bond, interest on the
predecessor Bond of such Bond is in default, such Bond shall bear interest from
the date to which interest has been paid, or, if no interest has been paid, from
the date of original issuance thereof. The 5.15% Series due 2032 shall be stated
to mature (subject to the right of earlier redemption at the prices and dates
and upon the terms and conditions hereinafter set forth) on September 1, 2032
and shall bear interest at the rate of 5.15%. The 3.75% Series due 2010 shall be
stated to mature (subject to the right of earlier redemption at the prices and
dates and upon the terms and conditions hereinafter set forth) on June 1, 2010
and shall bear interest at the rate of 3.75%.
The Bonds shall be issuable only as registered bonds without
coupons, shall be in the form hereinabove recited, in the denomination of Five
Thousand Dollars ($5,000) or any integral multiple thereof, shall be lettered
"AR" in the case of the 5.15% Series due 2032 and "BR" in the case of the 3.75%
Series due 2010, and shall bear such numbers as the Company may reasonably
require.
The principal of, and interest on the Bonds shall be payable
at the designated office of the trustee in Dallas, Texas, and shall be payable,
along with interest on the Bonds, in such coin or currency of the United States
of America as at the time of payment is legal tender for the payment of public
and private debts; each installment of interest shall be paid by check to the
order of the person entitled thereto, mailed to such person's address as the
same appears on the books maintained for such purpose by or on behalf of the
Company, or by bank wire transfer of immediately available funds pursuant to
instructions and conditions incorporated in an agreement between such person and
the Trustee or the Company.
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The person in whose name any Bond is registered at the close
of business on any Record Date (as hereinafter defined) with respect to any
interest payment date shall be entitled to receive the interest payable on such
interest payment date notwithstanding the cancellation of such Bond upon any
transfer or exchange subsequent to the Record Date and prior to such interest
payment date; provided, however, that if and to the extent the Company shall
default in the payment of the interest due on such interest payment date, such
defaulted interest shall be paid to the persons in whose names outstanding Bonds
are registered at the close of business on a subsequent Record Date established
by notice given by mail by or on behalf of the Company to the holders of Bonds
not less than fifteen days preceding such subsequent Record Date, such Record
Date to be not less than ten days preceding the date of payment of such
defaulted interest. The term "Record Date" with respect to any regular interest
payment date shall mean the fifteenth day of the calendar month next preceding
the month in which such interest payment date occurs.
The Bonds are being issued by the Company to secure the
obligation of the Company to pay to or for the account of the Authority an
amount equal to the principal of, and interest on, the Authority Bonds pursuant
to the Financing Agreement. The Authority Bonds are being sold to finance the
cost of the acquiring, constructing, installing and equipping of the Facilities
and to finance the refunding of the 1992 Bonds.
The Authority Bonds are to be issued under the Authority
Indenture and the right, title and interest of the Authority in and to the
Financing Agreement and the payments thereunder and the security for such
payments have been assigned by the Authority to the Authority Trustee, and the
Bonds are to be delivered by the Company on behalf of the Authority directly to
the Authority Trustee, as assignee, as security for the payment of the principal
of, and premium, if any, and interest on, the Authority Bonds. The Authority
Trustee may not sell, assign or otherwise transfer the Bonds except for a
transfer of the entire outstanding principal amount thereof to its successor as
Trustee under the Authority Indenture, which successor and each subsequent
successor shall hold the Bonds subject to the same restriction on transfer.
The text of the Bonds and of the certificate of the Trustee
upon such Bonds shall be, respectively, substantially of the tenor and effect
hereinbefore recited.
Exchange of any Bonds shall be effected in accordance with the
applicable provisions of Sections 7, 8 and 9 of Article II of the Original
Indenture.
SECTION 2. The Bonds are redeemable only as follows:
(a) The 5.15% Series due 2032 are subject to redemption prior
to maturity on or after September 1, 2013 by the Company, to the extent that the
Authority Series A Bonds are called for redemption under Section 7.01(a) of the
Authority Indenture, and then out of moneys deposited with or held by the
Trustee for such purpose, as a whole or in part, at any time in the manner
described below, at the redemption price of one hundred percent (100%) of the
principal amount to be redeemed, plus interest accrued thereon to the date fixed
for redemption:
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(b) The Bonds are subject to mandatory redemption as a whole
or in part at any time prior to maturity should the Company be required to make
payments with respect to the Authority Bonds pursuant to the provisions of
Section 7.02(a) of the Financing Agreement, or Sections 7.01(b)of the Authority
Indenture, if the Trustee shall receive a notice from the Authority or the
Authority Trustee that the Bonds are subject to mandatory redemption in
accordance with any of such provisions.
(c) The 3.75% Series due 2010 are not subject to optional
redemption.
(d) The Bonds are also subject to mandatory redemption by the
Company in whole if the Trustee shall receive a written demand from the
Authority Trustee for redemption of all such Bonds held by the Authority Trustee
stating that an "Event of Default" as defined in Section 9.01(a) of the
Authority Indenture has occurred and is continuing and that payment of the
principal of the Authority Bonds has been accelerated pursuant to Section
9.01(b) of the Authority Indenture, provided that at the time of notice of such
redemption as provided in Section 2 of Article V of the Original Indenture (i)
said written demand shall not have been withdrawn by the Authority Trustee, and
(ii) no event of default under Section 1 of Article XI of the Original Indenture
shall have occurred and be continuing.
SECTION 3. Any redemption of the Bonds shall be effected in
accordance with the provisions of Article V of the Original Indenture.
SECTION 4. In the event any Authority Bonds shall be purchased
by the Company, surrendered by the Company to the Authority Trustee for
cancellation and cancelled by the Authority Trustee, Bonds corresponding in
principal amount to the Authority Bonds so purchased, surrendered and cancelled
shall be deemed to have been paid in full.
SECTION 5. In the event and to the extent the principal of and
premium, if any, or interest on, any Authority Bonds is paid out of funds held
by the Authority Trustee other than payments of Bonds, the corresponding payment
of the principal of, and premium, if any, or interest on, an aggregate principal
amount of Bonds equal to the aggregate principal amount of such Authority Bonds
shall be deemed to have been satisfied.
SECTION 6. All Bonds deemed to have been paid in full as
provided in Section 4 and 5 of this Article I of this Thirty-Seventh
Supplemental Indenture shall be surrendered to the Trustee for cancellation, and
the Trustee shall forthwith cancel the same and, in accordance with applicable
laws and regulations and the Trustee's policies and procedures, and on the
written request of the Company, deliver the same to the Company. In case part of
an outstanding Bond shall be deemed to have been partially paid as provided in
said Section 4 or Section 5, upon presentation of such Bond at the designated
office of the Trustee, the Trustee shall make a notation thereon of the payment
of the portion of the principal amount of such Bond so deemed to have been paid
unless the registered owner shall elect to surrender such Bond to the Trustee,
in which case the Company shall execute and the Trustee shall authenticate and
deliver, without charge to the registered owner, Bonds in such authorized
denominations as shall be specified by the registered owner for the unpaid
balance of the principal amount of such outstanding Bond.
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SECTION 7. 5.15% Series due 2032 in the aggregate principal
amount of $25,000,000 and 3.75% Series due 2010 in the aggregate principal
amount of $3,200,000 may be issued under the provisions of Article IV of the
Original Indenture and may forthwith be executed by the Company and delivered to
the Trustee and shall be authenticated by the Trustee and delivered to or upon
the order of the Company, upon receipt by the Trustee of the resolutions,
certificates, opinions or other instruments or all of the foregoing required to
be delivered upon the issue of bonds pursuant to the provisions of the Original
Indenture.
ARTICLE II.
Maintenance or Improvement Deposit.
-----------------------------------
SECTION 1. The Company covenants that it will deposit with the
Trustee on or before the March 1 next occurring after the bonds of the 9.89%
Series due 2008 cease to be outstanding, or on or before the March 1 next
occurring after the bonds of the 9.93% Series due 2013 cease to be outstanding,
or on or before the next March 1 next occurring after the bonds of the 9.97%
Series due 2018 cease to be outstanding, or on or before the March 1 next
occurring after the bonds of the 9.12% Series due 2010 cease to be outstanding,
or on or before the March 1 next occurring after the bonds of the 9.29% Series
due 2026 cease to be outstanding, or on or before the March 1 next occurring
after the bonds of the 9.17% Series due 2021 cease to be outstanding, or on or
before the next March 1 next occurring after the bonds of the 9.17% Series due
2011 cease to be outstanding, or on or before the March 1 next occurring after
the bonds of the 6.50% Series due 2010 cease to be outstanding, or on or before
the next March 1 next occurring after the bonds of the 5.95% Series due 2002
cease to be outstanding, or on or before the March 1 next occurring after the
bonds of the 7.15% Series due 2008 cease to be outstanding, or on or before the
March 1 next occurring after the bonds of any of the Subseries of the 1995
Medium Term Note Series issued under the Twenty-Ninth Supplemental Indenture
(consisting of the 7.72% Subseries A due 2025, the 6.82% Subseries B due 2005,
the 6.89% Subseries C due 2015, the 6.99% Subseries D due 2006, the 7.47%
Subseries E due 2003, the 6.83% Subseries F due 2003, and the 7.06% Subseries G
due 2004) shall cease to be outstanding, or on or before the March 1 next
occurring after bonds of the 6.35% Series due 2025 shall cease to be
outstanding, on or before the March 1 next occurring after the bonds of any of
the Subseries of the 1997 Medium Term Note Series issued under the Thirty-First
Supplemental Indenture (consisting of the 6.75% Subseries A due 2007, the 6.30%
Subseries B due 2002, the 6.14% Subseries C due 2008, the 5.80% Subseries D due
2003, the 5.85% Subseries E due 2004 and the 6.00% Subseries F due 2004) cease
to be outstanding, or on or before March 1 next occurring after the bonds of
6.00% Series due 2029 cease to be outstanding, or on or before March 1 next
occurring after the Bonds of any of the Subseries of the 1999 Medium Term Note
Series issued under the Thirty-Third Supplemental Indenture (consisting of the
7.40% Subseries A due 2005, the 7.40% Subseries B due 2005, the 6.21% Subseries
C due 2011, the 9.53% Subseries D due 2019, the 6.375% Subseries E due 2023, the
8.26% Subseries F due 2022, the 9.50% Subseries G due 2006, the 9.22% Subseries
H due 2019, the 8.32% Subseries I due 2022, the 8.14% Subseries J due 2025 and
the 6.00% Subseries K due 2030) cease to be outstanding, or on or before March 1
next occurring after the bonds of the 5.35% Series due 2031 or on or before
March 1 next occurring after the bonds of the 5.55% Series due 2032 cease to be
outstanding, whichever is latest, an amount in cash (the "Maintenance or
Improvement Deposit") equal to 9% of the Gross Operating Revenues of the Company
during the preceding calendar year less, to the extent that the Company desires
to take such credits, the following:
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(a) the amount actually expended for maintenance
during such calendar year; and
(b) the Cost or Fair Value, whichever is less, of
Permanent Additions acquired during such calendar year which
at the time of taking such credit constitute Available
Permanent Additions; and
(c) the unapplied balance, or any part thereof, of
the Cost or Fair Value, whichever is less, of Available
Permanent Additions acquired by the Company during the five
calendar years preceding such calendar year and specified in
the Officers' Certificates delivered to the Trustee pursuant
to Section 2 of this Article, but only to the extent that the
Permanent Additions with respect to which such Cost or Fair
Value was determined shall at the time of taking such credit
constitute Available Permanent Additions.
SECTION 2. The Company covenants that it will on or before
March 1 in each year, beginning with the first deposit made with the Trustee
under the provisions of Section 1 of this Article, as long as any of the Bonds
are outstanding, deliver to the Trustee the following:
(A) An Officers' Certificate, which shall state:
(i) The amount of the Gross Operating
Revenues for the preceding calendar year;
(ii) 9% of such Gross Operating Revenues;
(iii) The amount actually expended by the
Company for maintenance during such calendar year;
(iv) The amount set forth in subparagraph
(xii) of each Officers' Certificate delivered to the Trustee
pursuant to the provisions of this Section during the
preceding five calendar years (specifying each such Officers'
Certificate), after deducting from each such amount the
aggregate of (a) the Cost or Fair Value, whichever is less, of
all Permanent Additions represented by such amount which have
ceased to be Available Permanent Additions; and (b) any part
of such amount for which the Company has previously taken
credit against any Maintenance or Improvement Deposit
(specifying the Officers' Certificate in which such credit was
taken); and (c) any part of such amount for which the Company
then desires to take credit against the Maintenance or
Improvement Deposit;
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(v) An amount which shall be the aggregate
of all amounts set forth pursuant to the provisions of clause
(c) of the foregoing subparagraph (iv);
(vi) The Cost or Fair Value, whichever is
less, of Available Permanent Additions acquired by the Company
during the preceding calendar year;
(vii) That part of the amount set forth in
subparagraph (vi) which the Company desires to use as a credit
against the Maintenance or Improvement Deposit;
(viii) The amount of cash payable to the
Trustee under the provisions of Section 1 of this Article,
which shall be the amount by which the amount set forth in
subparagraph (ii) hereof exceeds the sum of the amounts set
forth in subparagraphs (iii), (v) and (vii) hereof;
(ix) The sum of all amounts charged on the
books of the Company against any reserve for retirement or
depreciation during the preceding calendar year representing
the aggregate of the Cost when acquired of any part of the
Company's plants and property of the character described in
the granting clauses hereof which has been permanently retired
or abandoned;
(x) The aggregate of the amounts set forth
in subparagraphs (v) and (vii) hereof;
(xi) The amount by which the amount set
forth in subparagraph (x) exceeds the amount set forth in
subparagraph (ix), being the amount required to be deducted
from the Cost or Fair Value of Available Permanent Additions
in order to determine a Net Amount of Available Permanent
Additions pursuant to the provisions of Section 9 of Article I
of the Original Indenture;
(xii) The amount set forth in subparagraph
(vi) after deducting the amount, if any, set forth in
subparagraph (vii); and
(xiii) That all conditions precedent to the
taking of the credit or credits so requested by the Company
have been complied with.
(B) In the event that the Officers' Certificate delivered to
the Trustee pursuant to the provisions of paragraph (A) of this Section shall
state, pursuant to the requirements of subparagraph (vi), the Cost or Fair Value
of Available Permanent Additions acquired by the Company during the preceding
calendar year, the documents specified in paragraphs 2, 3, 5, 6 and 7 of
subdivision (B) of Section 3 of Article IV of the Original Indenture.
29
(C) An amount in cash equal to the sum set forth in
subparagraph (viii) of the Officers' Certificate provided for in paragraph (A)
hereof.
SECTION 3. All cash deposited with the Trustee as part of any
Maintenance or Improvement Deposit provided for in Section 1 of this Article,
may, at the option of the Company, be applied to the purchase of bonds under the
provisions of Section 2 of Article X of the Original Indenture or to the
redemption of bonds under the provisions of Section 3 of Article X of the
Original Indenture or may be withdrawn by the Company at any time to reimburse
the Company for the cost of a Net Amount of Available Permanent Additions
(excluding, however, from any such Available Permanent Additions all Permanent
Additions included in any certificate delivered to the Trustee for the purpose
of obtaining a credit against any Maintenance or Improvement Deposit provided
for in Section 1 of this Article to the extent that such Permanent Additions
have been used for any such credit). The Trustee shall pay to or upon the
written order of the Company all or any part of such cash upon the receipt by
the Trustee of:
(a) A Resolution requesting such payment; and
(b) The documents specified in paragraphs 2, 5, 6 and
7 of subdivision (B) of Section 3 of Article IV of the
Original Indenture, with such modifications, additions and
omissions as may be appropriate in the light of the purposes
for which they are used.
ARTICLE III.
Covenants of the Company.
-------------------------
SECTION 1. The Company hereby covenants and agrees with the
Trustee, for the benefit of the Trustee and all the present and future holders
of the Bonds, that the Company will pay the principal of, and premium, if any,
and interest on, all bonds issued or to be issued as aforesaid under and secured
by the Original Indenture as hereby supplemented, as well as all bonds which may
be hereafter issued in exchange or substitution therefor, and will perform and
fulfill all of the terms, covenants and conditions of the Original Indenture and
of this Thirty-Seventh Supplemental Indenture with respect to the additional
bonds to be issued under the Original Indenture as hereby supplemented.
SECTION 2. The Company covenants and agrees that so long as
any of the Bonds are outstanding (a) the Company will not make any Stock Payment
if, after giving effect thereto, its retained earnings, computed in accordance
with generally accepted accounting principles consistently applied, will be less
than the sum of (i) Excluded Earnings, if any, since December 31, 2001, and (ii)
$20,000,000; (b) Stock Payments made more than 40 days after the commencement,
and prior to the expiration, of any Restricted Period shall not exceed 65% of
the Company's Net Income during such Restricted Period; and (c) the Company will
not authorize a Stock Payment if there has occurred and is continuing an event
of default under subsections (a) and (b) of Section 1 of Article XI of the
Original Indenture.
30
For the purposes of this Section 2 the following terms shall
have the following meanings:
"Capitalization" shall mean the sum of (i) the aggregate
principal amount of all Debt at the time outstanding, (ii) the aggregate par or
stated value of all capital stock of the Company of all classes at the time
outstanding, (iii) premium on capital stock, (iv) capital surplus, and (v)
retained earnings.
"Debt" means (i) all indebtedness, whether or not represented
by bonds, debentures, notes or other securities, for the repayment of money
borrowed, (ii) all deferred indebtedness for the payment of the purchase price
of property or assets purchased (but Debt shall not be deemed to include
Customer Advances for Construction or any bonds issued under the Indenture which
are not Outstanding Bonds), (iii) leases which have been or, in accordance with
generally accepted accounting principles, should be recorded as capital leases
and (iv) guarantees of the obligations of another of the nature described in
clauses (i), (ii) or (iii) which have been or, in accordance with generally
accepted accounting principles, should be recorded as debt.
"Determination Date" shall mean the last day of each calendar
quarter. Any calculation with respect to any Determination Date shall be based
on the Company's balance sheet as of such date.
"Excluded Earnings" shall mean 35% of the Company's Net Income
during any Restricted Period.
"Net Income" for any particular Restricted Period shall mean
the amount of net income properly attributable to the conduct of the business of
the Company for such period, as determined in accordance with generally accepted
accounting principles consistently applied, after payment of or provision for
taxes on income for such period.
"Outstanding Bonds" shall mean bonds which are outstanding
within the meaning indicated in Section 20 of Article I of the Original
Indenture except that, in addition to the bonds referred to in clauses (a), (b)
and (c) of said Section 20, said term shall not include bonds for the retirement
of which sufficient funds have been deposited with the Trustee with irrevocable
instructions to apply such funds to the retirement of such bonds at a specified
time, which may be either the maturity thereof or a specified redemption date,
whether or not notice of redemption shall have been given.
"Restricted Period" shall mean a period commencing on any
Determination Date on which the total Debt of the Company is, or as the result
of any Stock Payment then declared or set aside and to be made thereafter will
be, more than 70% of Capitalization, and continuing until the third consecutive
Determination Date on which the total Debt of the Company does not exceed 70% of
Capitalization.
31
"Stock Payment" shall mean any payment in cash or property
(other than stock of the Company) to any holder of shares of any class of
capital stock of the Company as such holder, whether by dividend or upon the
purchase, redemption, conversion or other acquisition of such shares, or
otherwise.
SECTION 3. The Company covenants and agrees that so long as
any of the Bonds are outstanding, neither the Company nor any subsidiary of the
Company will, directly or indirectly, lend or in any manner extend its credit
to, or indemnify, or make any donation or capital contribution to, or purchase
any security of, any corporation which directly or indirectly controls the
Company, or any subsidiary or affiliate (other than an affiliate which is a
subsidiary of the Company) of any such corporation.
ARTICLE IV.
The Trustee.
------------
SECTION 1. The Trustee hereby accepts the trust hereby
declared and provided, and agrees to perform the same upon the terms and
conditions in the Original Indenture, as supplemented by this Thirty-Seventh
Supplemental Indenture.
SECTION 2. Subject to the provisions of Article XIII of the
Original Indenture, the Trustee may execute any of the trusts or powers hereof
and perform any of its duties by or through and consult with attorneys, agents,
officers or employees selected by the Trustee in its sole discretion. The
Trustee shall be entitled to advice of counsel concerning all matters of trusts
hereof and the duties hereunder and may in all cases pay such reasonable
compensation to all such attorneys, agents, officers and employees as may
reasonably be employed in connection with the trusts hereof. The Trustee may act
or refrain from acting and rely upon and be free from all liability for so
relying upon the opinion or advice of any attorney (who may be the attorney or
attorneys for the Company). The Trustee may act and rely on written opinions of
experts employed by the Trustee and such advice shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by the Trustee hereunder in good faith and in reliance thereon. The Trustee
shall not be responsible for any loss or damage resulting from any action or
non-action in good faith taken in reliance upon such opinion or advice. The
Trustee shall not be bound to confirm, verify or make any investigation into the
facts or matters stated in any financial or other statements, resolution,
certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order or other paper or document furnished pursuant to the terms
hereof.
SECTION 3. Before the Trustee shall be required to foreclose
on, or to take control or possession of, the real property or leasehold interest
(the "Premises") which may be the subject of any mortgage or mortgages for which
the Trustee is mortgagee in connection with the issuance of the Bonds, the
Trustee shall be indemnified and held harmless by the holders and/or beneficial
owners of the Bonds from and against any and all expense, loss, or liability
that may be suffered by the Trustee in connection with any spill, leak or
release which may have occurred on or invaded the Premises or any contamination
by any Hazardous Substance (hereinafter defined), whether caused by the Company
or any other person or entity, including, but not limited to, (1) any and all
32
reasonable expenses that the Trustee may incur in complying with any of the
Environmental Statutes (hereinafter defined), (2) any and all reasonable costs
that the Trustee may incur in studying or remedying any spill, leak or release
which may have occurred on or invaded the Premises or any contamination, (3) any
and all fines or penalties assessed upon the Trustee by reason of such
contamination, (4) any and all loss of value of the Premises or the improvements
thereon by reason of such contamination, and (5) any and all legal fees and
costs reasonably incurred by the Trustee in connection with any of the
foregoing. As used in this Section, contamination by any Hazardous Substance
shall include contamination, arising from the presence, creation, production,
collection, treatment, disposal, discharge, release, storage, transport or
transfer of any Hazardous Substance at or from the Premises or any improvements
thereon. As used in this Section, the term "Hazardous Substance" shall mean
petroleum hydrocarbons or any substance which (a) constitutes a hazardous waste
or substance under any applicable federal, state or local law, rule, order or
regulation now or hereafter adopted; (b) constitutes a "hazardous substance" as
such term is defined under the Comprehensive Environmental Response,
Compensation and Liability Act, as amended (42 U.S.C. ss.9601 et seq.) and the
regulations issued thereunder and any comparable state or local law or
regulation; (c) constitutes a "hazardous waste" under the Resource Conservation
and Recovery Act, (42 U.S.C. ss.6991) and the regulations issued thereunder and
any comparable state or local law or regulation; (d) constitutes a pollutant,
contaminant, chemical or industrial, toxic or hazardous substance or waste as
such terms are defined under Federal Clean Water Act, as amended (33 U.S.C.
ss.1251 et seq.), the Toxic Substances Control Act, as amended (15 U.S.C.
ss.2601 et seq.), or any comparable state or local laws or regulations; (e)
exhibits any of the characteristics enumerated in 40 C.F.R. Sections 261.20 -
261.24, inclusive; (f) those extremely hazardous substances listed in Section
302 of the Superfund Amendments and Reauthorization Act of 1986 (Public Law
99-499, 100 Stat. 1613) which are present in threshold planning or reportable
quantities as defined under such act; (g) toxic or hazardous chemical substances
which are present in quantities which exceed exposure standards as those terms
are defined under Sections 6 and 8 of the Occupational Safety and Health Act, as
amended (29 U.S.C. ss.ss.655 and 657 and 29 C.F.R. Part 1910, subpart 2); and
(h) any asbestos, petroleum-based products or any Hazardous Substance contained
within or release from any underground or aboveground storage tanks. As used in
this Section, the term "Environmental Statutes" shall mean the statutes, laws,
rules, orders and regulations referred to in (a) through (h) inclusive in the
preceding sentence.
ARTICLE V.
Miscellaneous.
--------------
SECTION 1. This instrument is executed and shall be construed
as an indenture supplemental to the Original Indenture, and shall form a part
thereof, and except as hereby supplemented, the Original Indenture and the
First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth,
Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth,
Eighteenth, Nineteenth, Twentieth, Twenty-First, Twenty-Second, Twenty-Third,
Twenty-Fourth, Twenty-Fifth, Twenty-Sixth, Twenty-Seventh, Twenty-Eighth,
Twenty-Ninth, Thirtieth, Thirty-First, Thirty-Second, Thirty-Third,
Thirty-Fourth, Thirty-Fifth and Thirty-Sixth Supplemental Indentures are hereby
confirmed. All references in this Thirty-Seventh Supplemental Indenture to the
Original Indenture shall be deemed to refer to the Original Indenture as
heretofore amended and supplemented, and all terms used herein and not
specifically defined herein shall be taken to have the same meaning as in the
Original Indenture, as so amended, except in the cases where the context clearly
indicates otherwise.
33
SECTION 2. Any notices to the Trustee under this
Thirty-Seventh Supplemental Indenture shall be delivered to the Trustee by
registered or certified mail, hand delivery or other courier or express delivery
service (with receipt confirmed) or by telecopy (with receipt confirmed) at the
following address:
X.X. Xxxxxx Trust Company, National Association
Institutional Trust Services
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Attention: Pennsylvania Suburban Water
Administrator
Telecopy: (000) 000-0000
Any change in such address or telecopy number may be made by notice to the
Company delivered in the manner set forth above.
SECTION 3. All recitals in this Thirty-Seventh Supplemental
Indenture are made by the Company only and not by the Trustee; and all of the
provisions contained in the Original Indenture in respect of the rights,
privileges, immunities, powers and duties of the Trustee shall be applicable in
respect hereof as fully and with like effect as if set forth herein in full.
SECTION 4. Although this Thirty-Seventh Supplemental Indenture
is dated as of December 15, 2002 for convenience and for the purpose of
reference, the actual date or dates of execution hereof by the Company and the
Trustee are as indicated by their respective acknowledgments annexed hereto.
SECTION 5. In order to facilitate the recording or filing of
this Thirty-Seventh Supplemental Indenture, the same may be simultaneously
executed in several counterparts, each of which shall be deemed to be an
original and such counterparts shall together constitute but one and the same
instrument.
34
IN WITNESS WHEREOF the parties hereto have caused their
corporate seals to be hereunto affixed and their authorized officers have hereto
affixed their signatures, and their authorized officers have duly attested the
execution hereof, as of the 15th day of December, 2002.
[CORPORATE SEAL] PENNSYLVANIA SUBURBAN WATER
COMPANY, as successor by merger to
Philadelphia Suburban Water Company
Attest: /s/ Xxx X. Xxxxx By: /s/ Xxxxx X. Xxxx
----------------------------- -------------------------------
Secretary Vice President and Treasurer
[CORPORATE SEAL] X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION,
as Trustee
Attest: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxxxxxx Xxxxxxxx
----------------------------- -------------------------------
Authorized Officer Authorized Officer
35
EXHIBIT A
BONDS REDEEMED OR PAID AT MATURITY
[to be supplied]
EXHIBIT B
Company's
County and Real Estate Date of Recorded Tax Parcel
Grantor Index No. Deed Book Page I.D.Number
---------- ----------- ------- ---- -------- ----------
[TO BE SUPPLIED]
X.X. Xxxxxx Trust Company National Association, Mortgagee and
Trustee named in the foregoing Thirty-Seventh Supplemental Indenture, hereby
certifies that its precise name and the post office address of its Institutional
Trust Services Group in Philadelphia, Pennsylvania are as follows:
X.X. Xxxxxx Trust Company, National Association
Institutional Trust Services
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Attention: Pennsylvania Suburban Water
Administrator
Telecopy: (000) 000-0000
X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION
By:
------------------------
Authorized Officer
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF XXXXXXXXXX
On the ___20th_ day of December, 2002, before me, the
Subscriber, a Notary Public for the Commonwealth of Pennsylvania, personally
appeared Xxxxx X. Xxxx, who acknowledged herself to be the Vice President and
Treasurer of Pennsylvania Suburban Water Company, a corporation, and that she as
such Vice President and Treasurer, being authorized to do so, executed the
foregoing Thirty-Seventh Supplemental Indenture as and for the act and deed of
said corporation and for the uses and purposes therein mentioned, by signing the
name of the corporation by herself as such officer.
In Witness Whereof I hereunto set my hand and official seal.
[NOTARIAL SEAL]
/s/ Xxxxxxxxx X. Xxxxx, Notary
------------------------------
COMMONWEALTH OF PENNSYLVANIA
COUNTY OF PHILADELPHIA
On the ___24th____ day of December, 2002 before me, the
Subscriber, a Notary Public for the Commonwealth of Pennsylvania, personally
appeared Xxxxxxxxx Xxxxxxxx, who acknowledged herself to be a Vice President of
X.X. Xxxxxx Trust Company, National Association, Trustee, a national banking
association, and that she as such Vice President, being authorized to do so,
executed the foregoing Thirty-Seventh Supplemental Indenture as and for the act
and deed of said national banking association and for the uses and purposes
therein mentioned by signing the name of said national banking association by
herself as such officer.
In Witness Whereof I hereunto set my hand and official seal.
[NOTARIAL SEAL]
/s/ Xxxxxx X. Xxxxxxxx, Notary
------------------------------
This Thirty-Seventh Supplemental Indenture was recorded on
_________, 2002 in the Office for the Recording of Deeds for each of the
counties tabulated below in the Mortgage Book and at the page indicated:
Mortgage
County Book Page
-------- ----
Berks ............................... ____ ____
Bradford ............................ ____ ____
Bucks ............................... ____ ____
Xxxxxxx ............................. ____ ____
Columbia ............................ ____ ____
Delaware ............................ ____ ____
Xxxxxxxx ............................ ____ ____
Xxxxxx .............................. ____ ____
Xxxxxxxxxx .......................... ____ ____
Northumberland ...................... ____ ____
Pike ................................ ____ ____
Schuylkill .......................... ____ ____
Xxxxx ............................... ____ ____
For the recording information with respect to the Original Indenture and the
first thirty-five supplemental indentures, see pages 4-6 of this Thirty-Seventh
Supplemental Indenture.
