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EXHIBIT 4.7
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SOUTHERN ENERGY, INC.
TO
BANKERS TRUST COMPANY,
TRUSTEE.
FIRST SUPPLEMENTAL INDENTURE
DATED AS OF , 2000
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$
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% JUNIOR CONVERTIBLE SUBORDINATED NOTES, SERIES A
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DUE 2030
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TABLE OF CONTENTS(1)
PAGE
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ARTICLE 1........................................................................................................ 1
SECTION 101. Establishment....................................................................................... 1
SECTION 102. Definitions......................................................................................... 2
SECTION 103. Payment of Principal and Interest................................................................... 6
SECTION 104. Deferral of Interest Payments....................................................................... 7
SECTION 105. Denominations....................................................................................... 8
SECTION 106. Global Securities................................................................................... 8
SECTION 107. Transfer............................................................................................ 9
SECTION 108. Redemption.......................................................................................... 9
SECTION 109. Exchange of Trust Securities for Series A Notes..................................................... 10
SECTION 110. Event of Default.................................................................................... 10
SECTION 111. Amendment of this Indenture......................................................................... 10
ARTICLE 2........................................................................................................ 11
SECTION 201. Conversion Rights................................................................................... 11
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(1) This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
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SECTION 202. Cash Settlement..................................................................................... 11
SECTION 203. Conversion Procedures............................................................................... 11
SECTION 204. Expiration of Conversion Rights..................................................................... 14
SECTION 205. Conversion Price Adjustments........................................................................ 14
SECTION 206. Fundamental Change.................................................................................. 18
SECTION 207 Notice of Adjustments of Conversion Price........................................................... 20
SECTION 208. Prior Notice of Certain Events...................................................................... 20
SECTION 209. Certain Additional Rights........................................................................... 21
SECTION 210. Restrictions on Company Common Stock Issuable Upon Conversion....................................... 22
SECTION 211. Trustee Not Responsible for Determining Conversion Price or Adjustments............................. 22
ARTICLE 3........................................................................................................ 23
SECTION 301. Recitals by Company................................................................................. 23
SECTION 302. Ratification and Incorporation of Original Indenture................................................ 23
SECTION 303. Executed in Counterparts............................................................................ 23
SECTION 304. Listing of Series A Notes........................................................................... 23
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THIS FIRST SUPPLEMENTAL INDENTURE is made as of the ____ day
of __________, 2000, by and between SOUTHERN ENERGY, INC., a Delaware
corporation, 000 Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000 (the
"Company"), and BANKERS TRUST COMPANY, a New York banking corporation, Four
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Trustee").
W I T N E S S E T H:
WHEREAS, the Company has heretofore entered into a
Subordinated Note Indenture, dated as of __________, 2000 (the "Original
Indenture") with Bankers Trust Company;
WHEREAS, the Original Indenture is incorporated herein by
this reference and the Original Indenture, as supplemented by this First
Supplemental Indenture, is herein called the "Indenture";
WHEREAS, under the Original Indenture, a new series of
Junior Subordinated Notes may at any time be established by the Board of
Directors of the Company in accordance with the provisions of the Original
Indenture and the terms of such series may be described by a supplemental
indenture executed by the Company and the Trustee;
WHEREAS, the Company proposes to create under the Indenture
a new series of Junior Subordinated Notes;
WHEREAS, additional Junior Subordinated Notes of other
series hereafter established, except as may be limited in the Original
Indenture as at the time supplemented and modified, may be issued from time to
time pursuant to the Indenture as at the time supplemented and modified; and
WHEREAS, all conditions necessary to authorize the
execution, delivery and recording of this First Supplemental Indenture and to
make it a valid and binding obligation of the Company have been done or
performed.
NOW, THEREFORE, in consideration of the agreements and
obligations set forth herein and for other good and valuable consideration, the
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE 1
JUNIOR CONVERTIBLE SUBORDINATED NOTES, SERIES A
SECTION 101. Establishment. There is hereby established a new series
of Junior Subordinated Notes to be issued under the Indenture, to be designated
as the Company's ____% Junior Convertible Subordinated Notes, Series A due 2030
(the "Series A Notes").
The aggregate principal amount of Series A Notes that may be
authenticated and delivered under this Indenture is limited to the sum of (a)
$_________ and (b) such aggregate principal
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amount which may not exceed $__________ of Series A Notes, if any, as shall be
purchased by the Trust pursuant to an over-allotment option in accordance with
the terms and provisions in the Underwriting Agreement, and no further Series A
Notes shall be authenticated and delivered except as provided by Sections 203,
303, 304, 907 or 1107 of the Original Indenture. The Series A Notes shall be
issued in definitive fully registered form. The Series A Notes will be
purchased from the Company by SEI Trust I, a Delaware business trust (the
"Trust"), with proceeds from the issuance and sale by the Trust of preferred
undivided beneficial interests in the Trust (the "Preferred Securities") and
common undivided beneficial interests in the Trust (the "Common Securities",
and collectively with the Preferred Securities, the "Trust Securities").
The Series A Notes shall be in substantially the form set out in
Exhibit A hereto. The entire principal amount of the Series A Notes shall
initially be evidenced by one certificate issued to the Property Trustee of the
Trust.
The form of the Trustee's Certificate of Authentication for the Series
A Notes shall be in substantially the form set forth in Exhibit B hereto.
Each Series A Note shall be dated the date of authentication thereof
and shall bear interest from the date of original issuance thereof or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for.
SECTION 102. Definitions. The following defined terms used herein
shall, unless the context otherwise requires, have the meanings specified
below. Capitalized terms used herein for which no definition is provided herein
shall have the meanings set forth in the Original Indenture.
"Applicable Price" means:
- in the case of a Non-Stock Fundamental change in which the
holders of Company Common Stock receive only cash, the amount
of cash received by the holder of one share of Company Common
Stock and
- in the event of any other Non-Stock Fundamental Change or any
Common Stock Fundamental Change, the average of the Closing
Prices (as defined below) for Company Common Stock during the
ten consecutive Trading Days prior to and including the
record date for the determination of the holders of Company
Common Stock entitled to receive those securities, cash or
other property in connection with that Non-Stock Fundamental
Change or Common Stock Fundamental Change or, if there is no
record date, the date that the holders of Company Common
Stock will have the right to receive those securities, cash
or other property (that record date or distribution date
being hereinafter referred to as the "Entitlement Date"), in
each case as adjusted in good faith by the Company to
appropriately reflect any of the events referred to under
Section 205 herein.
"Closing Price" means, on any day, the last reported sale price on
that day or, if no sales take place on that day, the average of the reported
closing bid and asked prices on that day, in either
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case as reported on the New York Stock Exchange Consolidated Transactions Tape,
or, if the stock is not listed or admitted to trading on the New York Stock
Exchange, on the principal national securities exchange on which such stock is
listed or admitted to trading or, if not listed or admitted to trading on any
national securities exchange, the average of the closing bid and asked prices
as furnished by any New York Stock Exchange member firm, selected by the
Trustee for that purpose.
"Common Stock Fundamental Change" means any Fundamental Change in
which more than 50% of the value, as determined in good faith by the Board of
Directors, of the consideration received by holders of Company Common Stock
consists of common stock that for each of the ten consecutive Trading Days
prior to the Entitlement Date has been admitted for listing or admitted for
listing subject to notice of issuance on a national securities exchange or
quoted on the Nasdaq National Market; provided, however, that a Fundamental
Change will not be a Common Stock Fundamental change unless either:
- the Company continues to exist after the occurrence of that
Fundamental Change and the outstanding Preferred Securities
continue to exist as outstanding Preferred Securities or
- not later than the occurrence of that Fundamental Change, the
outstanding Preferred Securities are converted into or
exchanged for shares of convertible preferred stock of any
entity succeeding to the business of the Company or a
subsidiary of the Company, which convertible preferred stock
has powers, preferences and relative participating, optional
or other rights and qualifications, limitations and
restrictions substantially similar to those of the Preferred
Securities.
"Company Common Stock" means common stock, par value $.01 per share,
of the Company.
"Conversion Agent" has the meaning specified in Section 203.
"Conversion Date" has the meaning specified in Section 203.
"Conversion Price" has the meaning specified in Section 201.
"Current Market Price" means, for any day, the last reported sale
price, regular way, on such day of Company Common Stock, or, if no sale takes
place on such day, the average of the reported closing bid and asked prices on
such day, regular way, in either case as reported on the New York Stock
Exchange Consolidated Transactions Tape, or, if Company Common Stock is not
listed or admitted to trading on the New York Stock Exchange on such day, on
the principal national securities exchange on which Company Common Stock is
listed or admitted to trading, if Company Common Stock is listed on a national
securities exchange, or the Nasdaq National Market, or, if Company Common Stock
is not quoted or admitted to trading on such quotation system, on the principal
quotation system on which the Company Common Stock may be listed or admitted to
trading or quoted, or, if not listed or admitted to trading or quoted on any
national securities exchange or quotation system, the average of the closing
bid and asked prices of Company Common Stock in the over-the-counter market on
the day in question as reported by the
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National Quotation Bureau Incorporated, or a similar generally accepted
reporting service, or, if not so available in such manner, as furnished by any
New York Stock Exchange member firm selected from time to time by the Board of
Directors for that purpose or, if not so available in such manner, as otherwise
determined in good faith by the Board of Directors.
"Deferred Interest" means each installment of interest not paid during
any Extension Period, and interest thereon. Deferred installments of interest
shall bear interest at the rate of ____% per annum from the applicable Interest
Payment Date to the date of payment, compounded quarterly.
"Expiration Time" has the meaning specified in Section 205(e).
"Extension Period" means any period during which the Company has
elected to defer payments of interest, which deferral may be for a period of up
to twenty (20) consecutive quarters.
"Fundamental Change" means the occurrence of any transaction or event
in connection with a plan pursuant to which all or substantially all of Company
Common Stock will be exchanged for, converted into, acquired for or constitute
solely the right to receive securities, cash or other property (whether by
means of an exchange offer, liquidation, tender offer, consolidation, merger,
combination, reclassification, recapitalization or otherwise). In the case of a
plan involving more than one of these transactions or events, however, for
purposes of adjustment of the Conversion Price, the Fundamental Change will be
deemed to have occurred when substantially all Company Common Stock is
exchanged for, converted into or acquired for or constitute solely the right to
receive securities, cash or other property, but the adjustment will be based
upon the consideration that a holder of Company Common Stock received in that
transaction or event as a result of which more than 50% of Company Common Stock
will have been exchanged for, converted into or acquired for or constitute
solely the right to receive securities, cash or other property.
"Interest Payment Dates" means ____________, ____________,
____________ and ____________ of each year.
"Investment Company Act Event" means that the Company shall have
received an Opinion of Counsel to the effect that, as a result of the
occurrence of a change (including prospective change) in law or regulation or a
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or will be considered an "investment
company" that is required to be registered under the Investment Company Act of
1940, as amended, which change becomes effective on or after the Original Issue
Date.
"Non-Stock Fundamental Change" means any Fundamental Change other than
a Common Stock Fundamental Change.
"Notice of Conversion" means the notice given by a holder of Preferred
Securities to the Conversion Agent to exchange such Preferred Securities for
Series A Notes and to convert such Series A Notes into Company Common Stock on
behalf of such holder.
"Original Issue Date" means ____________, 2000.
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"Preferred Securities" has the meaning specified in the recitals of
this Indenture.
"Purchased Shares" has the meaning specified in Section 205(e).
"Purchaser Stock Price" means, with respect to any Common Stock
Fundamental Change, the average of the Closing Prices for the common stock
received in that Common Stock Fundamental Change for the ten consecutive
Trading Days prior to and including the Entitlement Date, as adjusted in good
faith by us to approximately reflect any of the events referred to in Section
205 herein.
"Reference Date" has the meaning specified in Section 205(c).
"Reference Market Price" initially means $__________ (which is an
amount equal to 66-2/3% of the initial public offering price of Company Common
Stock). In the event of any adjustment of the applicable Conversion Price,
other than as a result of a Non-Stock Fundamental Change, the Reference Market
Price will also be adjusted so that the ratio of the Reference Market Price to
the Conversion Price after giving effect to any adjustment will always be the
same as the ratio of the Initial Reference Market Price to the initial
Conversion Price of the Preferred Securities.
"Regular Record Date" means, with respect to each Interest Payment
Date, the close of business on the 15th calendar day next preceding such
Interest Payment Date.
"Rights" has the meaning specified in Section 203(f).
"Rights Agreement" has the meaning specified in Section 203(f).
"Special Event" means an Investment Company Act Event or Tax Event.
"Spin-Off" means the distribution by The Southern Company of all of
its shares of Company Common Stock to the holders of its common stock.
"Stated Maturity" means ____________, 2030.
"Tax Event" means that the Company shall have received an Opinion of
Counsel experienced in such matters to the effect that, as a result of (a) any
amendment to, or change (including any announced prospective change) in, laws
(or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein; (b) any amendment to, or
change in, an interpretation or application of such laws or regulations by any
legislative body, court, governmental agency or regulatory authority (including
the enactment of any legislation and the publication of any judicial decision
or regulatory determination); (c) any interpretation or pronouncement by any
legislative body, court, governmental agency or regulatory authority that
provides for a position with respect to such laws or regulations that differs
from its previous position or a commonly accepted position; or (d) any action
taken by any governmental agency or regulatory authority, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the date
of the Opinion of Counsel, subject to United States federal income tax with
respect
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to income accrued or received on the Series A Notes, (ii) interest payable by
the Company on the Series A Notes is not, or will not be within 90 days of the
date of the Opinion of Counsel, deductible by the Company for United States
federal income tax purposes, (iii) the timing of the deduction for interest
payable by the Company on the Series A Notes is, or will be within 90 days of
the date of the Opinion of Counsel, required to be made by reference to a
system that defers the timing of such deductions compared to the timing
permitted under the principles of economic accrual; or (iv) the Trust would be
subject to more than a de minimis amount of other taxes, duties or other
governmental charges, which change or amendment becomes effective on or after
the Original Issue Date.
"Trading Day" means (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national
security exchange, a day on which the New York Stock Exchange or another
national security exchange is open for business, or (y) if the applicable
security is quoted on the Nasdaq National Market, a day on which trades may be
made thereon or (z) if the applicable security is not so listed, admitted for
trading or quoted, any day other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or obligated by
law or executive order to close.
"Transaction" has the meaning specified in Section 206(a).
"Trust" means SEI Trust I, a statutory business trust formed by the
Company under Delaware law to issue Trust Securities, the proceeds of which
will be used to purchase Series A Notes.
"Underwriters" means the underwriters named in the Underwriting
Agreement.
"Underwriting Agreement" means the Underwriting Agreement, dated
__________, 2000, among the Trust, the Company and the underwriters named
therein.
SECTION 103. Payment of Principal and Interest. The unpaid principal
amount of the Series A Notes shall bear interest at the rate of ____% per annum
until paid or duly provided for. Interest shall be paid quarterly in arrears on
each Interest Payment Date to the Person in whose name the Series A Notes are
registered on the Regular Record Date for such Interest Payment Date, provided
that interest payable at Maturity of principal or on a Redemption Date as
provided herein will be paid to the Person to whom principal is payable. So
long as an Extension Period is not occurring, any such interest that is not so
punctually paid or duly provided for will forthwith cease to be payable to the
Holders on such Regular Record Date and may either be paid to the Person or
Persons in whose name the Series A Notes are registered at the close of
business on a Special Record Date for the payment of such defaulted interest to
be fixed by the Trustee ("Special Record Date"), notice whereof shall be given
to Holders of the Series A Notes not less than ten (10) days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange, if any, on which
the Series A Notes shall be listed, and upon such notice as may be required by
any such exchange, all as more fully provided in the Original Indenture.
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Payments of interest on the Series A Notes will include interest
accrued to but excluding the respective Interest Payment Dates. Interest
payments for the Series A Notes shall be computed and paid on the basis of a
360-day year of twelve 30-day months. If the amount of interest is calculated
for any period shorter than a full quarterly interest period, it will be
computed on the basis of the number of days elapsed on a 360-day year. In the
event that any date on which interest is payable on the Series A Notes is not a
Business Day, then a payment of the interest payable on such date will be made
on the next succeeding day that is a Business Day without any interest or other
payment resulting from such delay, except that, if such Business Day is in the
next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date the payment was originally payable.
If a Tax Event occurs, then the Company has the right (i) prior to the
dissolution of the Trust, to shorten the Stated Maturity of the Series A Notes
to the minimum extent required, but not earlier than ____________, 2015, or
(ii) to direct the Property Trustee to dissolve the Trust (if not previously
dissolved) and shorten the Stated Maturity of the Series A Notes to the minimum
extent required, but not earlier than ____________, 2015, in each case such
that in the Opinion of Counsel experienced in such matters, after shortening
the Stated Maturity, interest paid on the Series A Notes will be deductible by
the Company for federal income tax purposes.
Payment of the principal and interest (including Additional Interest,
if any) due at Maturity or earlier redemption of the Series A Notes shall be
made upon surrender of the Series A Notes at the Corporate Trust Office of the
Trustee, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
Payments of interest (including interest on any Interest Payment Date) will be
made, subject to such surrender where applicable, at the option of the Company,
(i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer at such
place and to such account at a banking institution in the United States as may
be designated in writing to the Trustee at least sixteen (16) days prior to the
date for payment by the Person entitled thereto.
The Company shall pay, as Additional Interest on the Series A Notes,
when due to the United States or any other taxing authority, the amounts set
forth in clause (i) of the definition of Additional Interest.
SECTION 104. Deferral of Interest Payments. So long as no Event of
Default has occurred and is continuing, the Company has the right at any time
and from time to time to extend the interest payment period of the Series A
Notes for up to twenty (20) consecutive quarters (each, an "Extension Period"),
but not beyond the Stated Maturity. Notwithstanding the foregoing, the Company
has no right to extend its obligation to pay such amounts as are defined in
clause (i) of the definition of Additional Interest. Prior to the termination
of any such Extension Period, the Company may further extend the interest
payment period, provided that such Extension Period, together with all such
previous and further extensions of that Extension Period, shall not exceed
twenty (20) consecutive quarters. Upon the termination of any such Extension
Period and upon the payment of all accrued and unpaid interest and any
Additional Interest then due, the Company may select a new Extension Period,
subject to the above limitations and requirements.
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Upon the termination of any Extension Period, which termination shall
be on an Interest Payment Date, the Company shall pay all Deferred Interest to
the Person in whose name the Series A Notes are registered on the Regular
Record Date for such Interest Payment Date, provided that Deferred Interest
payable at Maturity or on any Redemption Date will be paid to the Person to
whom principal is payable.
The Company shall give the Trustee, the Property Trustee and the
Administrative Trustees notice of its selection or extension of an Extension
Period at least one Business Day prior to the earlier of (i) the Regular Record
Date relating to the Interest Payment Date on which the Extension Period is to
commence or relating to the Interest Payment Date on which an Extension Period
that is being extended would otherwise terminate, or (ii) the date the Property
Trustee (or if no Preferred Securities are outstanding, the Trustee) is
required to give notice to the New York Stock Exchange or other applicable
self-regulatory organization of the record date or the date distributions are
payable.
The Trustee shall promptly give notice of the Company's selection of
an Extension Period to Holders of Outstanding Series A Notes and holders of
Preferred Securities.
At any time any of the foregoing notices are given to the Trustee, the
Company shall give to the Paying Agent for the Series A Notes such information
as said Paying Agent shall reasonably require in order to fulfill its tax
reporting obligations with respect to such Series A Notes.
SECTION 105. Denominations. The Series A Notes may be issued in
denominations of $50, or any integral multiple thereof.
SECTION 106. Global Securities. If the Series A Notes are
distributed to Holders of the Trust Securities of the Trust in liquidation of
such Holders' interests therein, the Series A Notes will be issued in the form
of one or more Global Securities registered in the name of the Depositary
(which shall be The Depository Trust Company) or its nominee. Except under the
limited circumstances described below, Series A Notes represented by the Global
Security will not be exchangeable for, and will not otherwise be issuable as,
Series A Notes in definitive form. The Global Securities described above may
not be transferred except by the Depositary to a nominee of the Depositary or
by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or to a successor Depositary or its nominee.
Owners of beneficial interests in such a Global Security will not be
considered the Holders thereof for any purpose under the Indenture, and no
Global Security representing a Series A Note shall be exchangeable, except for
another Global Security of like denomination and tenor to be registered in the
name of the Depositary or its nominee or to a successor Depositary or its
nominee. The rights of Holders of such Global Security shall be exercised only
through the Depositary.
A Global Security shall be exchangeable for Series A Notes registered
in the names of persons other than the Depositary or its nominee only if (i)
the Depositary notifies the Company that it is unwilling or unable to continue
as a Depositary for such Global Security and no successor Depositary shall have
been appointed, or if at any time the Depositary ceases to be a clearing agency
registered under the Securities Exchange Act of 1934, as amended, at a time
when the
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Depositary is required to be so registered to act as such Depositary and no
successor Depositary shall have been appointed, (ii) the Company in its sole
discretion determines that such Global Security shall be so exchangeable, or
(iii) there shall have occurred an Event of Default with respect to the Series
A Notes. Any Global Security that is exchangeable pursuant to the preceding
sentence shall be exchangeable for Series A Notes registered in such names as
the Depositary shall direct.
SECTION 107. Transfer. No service charge will be made for any
transfer or exchange of Series A Notes, but payment will be required of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith.
The Company shall not be required (a) to issue, transfer or exchange
any Series A Notes during a period beginning at the opening of business fifteen
(15) days before the day of the mailing of a notice identifying the serial
numbers of the Series A Notes to be called for redemption, and ending at the
close of business on the day of the mailing, or (b) to transfer or exchange any
Series A Notes theretofore selected for redemption in whole or in part, except
the unredeemed portion of any Series A Note redeemed in part.
SECTION 108. Redemption. The Series A Notes shall be subject to
redemption at the option of the Company, in whole or in part, at any time or
from time to time on or after ____________, 2003, or at any time in whole, but
not in part, upon the occurrence of a Special Event; provided, however, that if
a redemption in part shall result in the delisting of the Preferred Securities
issued by the Trust, the Company may only redeem the Series A Notes in whole.
"Redemption Price," in the case of a redemption, in whole or in part,
at the option of the Company, but not upon the occurrence of a Special Event,
shall equal the following prices expressed in percentages of the principal
amount together with accrued interest to but excluding the date fixed for
redemption. If redeemed during the 12-month period beginning ___________, ____;
YEAR REDEMPTION PRICE
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[to come]
Upon the occurrence of a Special Event at any time, the Company may,
within ninety (90) days following the occurrence thereof and subject to the
terms and conditions of the Indenture, elect to redeem the Series A Notes, in
whole.
"Redemption Price," in the case of a redemption following a Special
Event, means for each Series A Note a price equal to 100% of the principal
amount of the Series A Notes being redeemed, plus accrued and unpaid interest
to the date fixed for redemption.
In the case of a Tax Event that shall have occurred and be continuing,
the Company may elect to pay any Additional Interest such that the amounts to
be received by holders of the Trust Securities are not reduced as a result of
such Tax Event.
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In the event of redemption of the Series A Notes in part only, a new
Series A Note or Notes for the unredeemed portion will be issued in the name or
names of the Holders thereof upon the surrender thereof.
The Series A Notes will not have a sinking fund.
Notice of redemption shall be given as provided in Section 1104 of the
Original Indenture.
Any redemption of less than all of the Series A Notes shall, with
respect to the principal thereof, be divisible by $50.
Upon (i) repayment at maturity or (ii) as a result of acceleration
upon the occurrence and continuation of an Event of Default, the Company shall
redeem the Outstanding Series A Notes, in whole but not in part, at a
redemption price equal to 100% of the principal amount of such Series A Notes
plus any accrued and unpaid interest, including any Additional Interest, to the
date fixed for redemption.
SECTION 109. Exchange of Trust Securities for Series A Notes. At
any time, the Company shall have the right to dissolve the Trust and cause the
Series A Notes to be distributed to the holders of the Trust Securities in
exchange for the Preferred Securities in dissolution of the Trust after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law.
SECTION 110. Event of Default. In addition to the Events of
Default set forth in Section 501 of the Original Indenture, the failure by the
Company to issue Company Common Stock upon an appropriate election by the
Holder or Holders of the Series A Notes to convert the Series A Notes into
shares of Company Common Stock shall be an Event of Default with respect to the
Series A Notes.
SECTION 111. Amendment of this Indenture. Without the consent of
the Holders of each Outstanding Series A Note affected thereby, no amendment or
supplement to this Indenture may adversely affect any right to convert or
exchange any Series A Note.
SECTION 112. Defeasance and Discharge. Notwithstanding Section 403
of the Original Indenture, the Series A Notes will not be subject to defeasance
or discharge.
ARTICLE 2
CONVERSION OF SERIES A NOTES
SECTION 201. Conversion Rights. Subject to and upon compliance
with the provisions of this Article and subject to the Company's right to elect
cash settlement as set forth below, the Series A Notes are convertible, at the
option of the Holder, at any time on or after ____________, 2001 and prior to
the redemption or Maturity, into fully paid and nonassessable shares of Company
Common Stock at an initial conversion rate of __________ shares of Company
Common Stock for each $50 in aggregate principal amount of Series A Notes
(equal to a conversion price of approximately $____ per share of Company Common
Stock), subject to
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adjustment as described in this Article 2 (as adjusted, the "Conversion
Price"). A Holder of Series A Note may convert any portion thereof that is
called for redemption into that number of fully paid and nonassessable shares
of Company Common Stock (calculated as to each conversion to the nearest
1/100th of a share) obtained by dividing the principal amount of the Series A
Note to be converted by the Conversion Price. In case a Series A Note or
portion thereof is called for redemption, such conversion right in respect of a
Series A Note or portion so called shall expire at the close of business on the
Business Day prior to the Redemption Date, unless the Company defaults in
making the payment due upon redemption.
SECTION 202. Cash Settlement. At any time after __________, 2001
and prior to the Spin-Off, the Company may elect to make a cash settlement in
respect of any Series A Note surrendered for conversion by delivering notice
thereof to the tendering Holder not more than five Trading Days after such
Series A Note is surrendered for conversion. Such cash settlement shall be in
an amount, per $50 principal amount of Series A Notes delivered for conversion,
equal to the product of (i) the then-prevailing Conversion Price and (ii) the
average of the Closing Price of the Company Common Stock on the five Trading
Days commencing two Trading Days after delivery by the Company of such notice
to such Holder. The Company will pay such amount as promptly as practicable
after the completion of such five Trading Day period.
SECTION 203. Conversion Procedures.
(a) In order to convert all or a portion of the Series A Notes
into Company Common Stock or cash, as the case may be, the Holder thereof shall
deliver to the Property Trustee, as conversion agent or to such other agent
appointed for such purposes (the "Conversion Agent"), an irrevocable Notice of
Conversion setting forth the principal amount of Series A Notes to be
converted, together with the name or names, if other than the Holder, in which
the shares of Company Common Stock or cash, as the case may be, should be
issued upon conversion and, if such Series A Notes are definitive Series A
Notes, surrender to the Conversion Agent the Series A Notes to be converted,
duly endorsed or assigned to the Company or in blank. In addition, a holder of
Preferred Securities may exercise its right under the Trust Agreement to
convert such Preferred Securities into Company Common Stock or cash, as the
case may be, by delivering to the Conversion Agent an irrevocable Notice of
Conversion setting forth the information called for by the preceding sentence
and directing the Conversion Agent (i) to exchange such Preferred Securities
for a portion of the Series A Notes held by the Trust (at an exchange rate of
$50 principal amount of Series A Notes for each Preferred Security) and (ii) to
immediately (unless the Spin-Off has not yet occurred, in which case within the
time specified in Section 202) convert such Series A Notes, on behalf of such
holder, into Company Common Stock or cash, as the case may be, pursuant to this
Article 2 and, if such Preferred Securities are in definitive form,
surrendering such Preferred Securities, duly endorsed or assigned to the
Company or in blank. So long as any Preferred Securities are outstanding, the
Trust shall not convert any Series A Notes except pursuant to a Notice of
Conversion delivered to the Conversion Agent by a holder of Preferred
Securities.
If a Notice of Conversion is delivered on or after the Regular Record
Date and prior to the subsequent Interest Payment Date, the Holder of record on
the Regular Record Date will be entitled to receive the interest paid on the
subsequent Interest Payment Date on the portion of Series A Notes to be
converted notwithstanding the conversion thereof prior to such Interest Payment
Date.
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Except as otherwise provided in the immediately preceding sentence, in the case
of any Series A Note that is converted, interest whose Interest Payment Date is
on or after the date of conversion of such Series A Note shall not be payable,
and the Company shall not make nor be required to make any other payment,
adjustment or allowance with respect to accrued but unpaid interest on the
Series A Notes being converted, which shall be deemed to be paid in full.
Series A Notes submitted for conversion prior to the expiration of conversion
rights as provided in Section 204 shall be deemed to have been converted
immediately prior to the close of business on the day on which the Notice of
Conversion was received (the "Conversion Date") by the Conversion Agent from
the Holder or from a holder of the Preferred Securities effecting a conversion
thereof pursuant to its conversion rights under the Trust Agreement, as the
case may be. The Person or Persons entitled to receive Company Common Stock
issuable upon such conversion shall be treated for all purposes as the record
holder or holders of such Company Common Stock as of the Conversion Date and
such Person or Persons will cease to be a record Holder or record Holders of
the Series A Notes on that date. As promptly as practicable on or after the
Conversion Date, the Company shall issue and deliver at the office of the
Conversion Agent, unless otherwise directed by the Holder or holder in the
Notice of Conversion, a certificate or certificates for the number of full
shares of Company Common Stock issuable upon such conversion, together with the
cash payment, if any, in lieu of any fraction of any share to the Person or
Persons entitled to receive the same. The Conversion Agent shall deliver such
certificate or certificates to such Person or Persons.
(b) The Company's delivery upon conversion of the fixed number of
shares of Company Common Stock into which the Series A Notes are convertible
(together with the cash payment, if any, in lieu of fractional shares) shall be
deemed to satisfy the Company's obligation to pay the principal amount at the
Stated Maturity of the portion of Series A Notes so converted and any unpaid
interest (including Additional Interest) accrued on such Series A Notes at the
time of such conversion.
(c) No fractional shares of Company Common Stock will be issued
as a result of conversion, but in lieu thereof, the Company shall pay to the
Conversion Agent a cash adjustment in an amount equal to the same fraction of
the Current Market Price with respect to such fractional interest on the date
on which the Series A Notes or Preferred Securities, as the case may be, were
duly surrendered to the Conversion Agent for conversion, and the Conversion
Agent in turn will make such payment, if any, to the Holder of the Series A
Notes or the holder of the Preferred Securities so converted.
(d) In the event of the conversion of any Series A Note in part
only, a new Series A Note or Series A Notes for the unconverted portion thereof
will be issued in the name of the Holder thereof upon the cancellation of the
Series A Note converted in part in accordance with Section 307 of the Original
Indenture.
(e) In effecting the conversion transaction described in this
Section, the Conversion Agent is acting as agent of the holders of Preferred
Securities (in the exchange of Preferred Securities for Series A Notes) and as
agent of the Holders of Series A Notes (in the conversion of Series A Notes
into Company Common Stock), as the case may be, directing it to effect such
conversion transactions. The Conversion Agent is hereby authorized (i) to
exchange Series A Notes held by the Trust from time to time for Preferred
Securities in connection with the conversion
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of such Preferred Securities in accordance with this Article 2 and (ii) to
convert all or a portion of the Series A Notes into Company Common Stock and
thereupon to deliver such shares of Company Common Stock in accordance with the
provisions of this Article 2 and to deliver to the Trust a new Series A Note or
Series A Notes for any resulting unconverted principal amount.
(f) The Company shall at all times reserve and keep available out
of its authorized and unissued Company Common Stock, solely for issuance upon
the conversion of the Series A Notes, such number of shares of Company Common
Stock as shall from time to time be issuable upon the conversion of all the
Series A Notes then outstanding. Notwithstanding the foregoing, the Company
shall be entitled to deliver upon conversion of Series A Notes shares of
Company Common Stock reacquired and held in the treasury of the Company (in
lieu of the issuance of authorized and unissued shares of Company Common Stock)
so long as any such treasury shares are free and clear of all liens, charges,
security interests or encumbrances. Whenever the Company issues shares of
Company Common Stock upon conversion of Series A Notes, and the Company has in
effect at such time a stock purchase rights agreement ("Rights Agreement")
under which holders of Company Common Stock are issued rights ("Rights")
entitling the holders under certain circumstances to purchase an additional
share or shares of stock, the Company will issue, together with each such share
of Company Common Stock, such number of Rights (which number may be a fraction)
as shall at that time be issuable with a share of Company Common Stock pursuant
to such Rights Agreement. Any shares of Company Common Stock issued upon
conversion of the Series A Notes shall be duly authorized, validly issued and
fully paid and nonassessable. The Conversion Agent shall deliver the shares of
Company Common Stock received upon conversion of the Series A Notes to the
converting Holder free and clear of all liens, charges, security interests and
encumbrances, except for United States withholding taxes. The Company shall use
its reasonable best efforts to obtain and keep in force such governmental or
regulatory permits or other authorizations as may be required by law, and shall
comply with all applicable requirements as to registration or qualification of
Company Common Stock (and all requirements to list Company Common Stock
issuable upon conversion of Series A Notes that are at the time applicable), in
order to enable the Company to lawfully issue Company Common Stock upon
conversion of Series A Notes and to lawfully deliver Company Common stock to
each Holder upon conversion of the Series A Notes.
(g) The Company will pay any and all taxes that may be payable in
respect of the issue or delivery of shares of Company Common Stock on
conversion of Series A Notes. The Company shall not, however, be required to
pay any tax that may be payable in respect of any transfer involved in the
issue and delivery of shares of Company Common Stock in a name other than that
in which the Series A Notes so converted were registered, and no such issue or
delivery shall be made unless and until the Person requesting such issue has
paid to the Conversion Agent the amount of any such tax, or has established to
the satisfaction of the Conversion Agent that such tax has been paid.
(h) Nothing in this Article 2 shall limit the requirement of the
Company to withhold taxes pursuant to the terms of the Series A Notes or as set
forth in this Indenture or otherwise require the Trustee or the Company to pay
any amounts on account of such withholdings.
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SECTION 204. Expiration of Conversion Rights. The conversion
rights of Holders of Series A Notes shall expire either (i) in the case of
Series A Notes called for redemption, at the close of business on the Business
Day prior to the date set for redemption of the Series A Notes or (ii) at the
close of business on the Business Day prior to the Stated Maturity of the
Series A Notes.
SECTION 205. Conversion Price Adjustments. The conversion price
shall be subject to adjustment (without duplication) from time to time as
follows:
(a) In case the Company shall, while any of the Series A
Notes are Outstanding, (i) pay a dividend or make a distribution with
respect to its Company Common Stock exclusively in shares of Company
Common Stock, (ii) subdivide its outstanding shares of Company Common
Stock, (iii) combine its outstanding shares of Company Common Stock
into a smaller number of shares or (iv) issue by reclassification of
its shares of Company Common Stock any shares of capital stock of the
Company, the conversion privilege and the Conversion Price in effect
immediately prior to such action shall be adjusted so that the Holder
of any Series A Notes thereafter surrendered for conversion shall be
entitled to receive the number of shares of capital stock of the
Company that he would have owned immediately following such action had
such Series A Notes been converted immediately prior thereto. An
adjustment made pursuant to this subsection (a) shall become effective
immediately after the record date in the case of a dividend or other
distribution and shall become effective immediately after the
effective date in case of a subdivision, combination or
reclassification (or immediately after the record date if a record
date shall have been established for such event). If, as a result of
an adjustment made pursuant to this subsection (a), the Holder of any
Series A Notes thereafter surrendered for conversion shall become
entitled to receive shares of two or more classes or series of capital
stock of the Company, the Board of Directors (whose determination
shall be conclusive and shall be described in a Board Resolution filed
with the Trustee) shall determine the allocation of the adjusted
Conversion Price between or among shares of such classes or series of
capital stock. In the event that such dividend, distribution,
subdivision, combination or issuance is not so paid or made, the
Conversion Price shall again be adjusted to be the Conversion Price
that would then be in effect if such record date had not been fixed.
(b) In case the Company shall, while any of the Series A
Notes are Outstanding, issue rights or warrants to all holders of its
Company Common Stock entitling them (for a period expiring within 45
days after the record date for the determination of stockholders
entitled to receive such rights or warrants) to subscribe for or
purchase shares of Company Common Stock at a price per share less than
the Current Market Price per share of Company Common Stock on such
record date, the Conversion Price for the Series A Notes shall be
adjusted so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the
date of issuance of such rights or warrants by a fraction of which the
numerator shall be the number of shares of Company Common Stock
outstanding on the date of issuance of such rights or warrants plus
the number of shares that the aggregate offering price of the total
number of shares so offered for subscription or purchase would
purchase at such Current Market Price, and of which the denominator
shall be the number of shares of
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Company Common Stock outstanding on the date of issuance of such rights
or warrants plus the number of additional shares of Company Common
Stock offered for subscription or purchase. Such adjustment shall
become effective immediately after the record date for the
determination of stockholders entitled to receive such rights or
warrants. For the purposes of this subsection, the number of shares of
Company Common Stock at any time outstanding shall not include shares
held in the treasury of the Company. The Company shall not issue any
rights or warrants in respect of shares of Company Common Stock held in
the treasury of the Company. In case any rights or warrants referred to
in this subsection in respect of which an adjustment shall have been
made shall expire unexercised within 45 days after the same shall have
been distributed or issued by the Company, the Conversion Price shall
be readjusted at the time of such expiration to the Conversion Price
that would have been in effect if no adjustment had been made on
account of the distribution or issuance of such expired rights or
warrants.
(c) Subject to the last sentence of this subparagraph, in
case the Company shall, by dividend or otherwise, distribute to all
holders of its Company Common Stock evidences of its indebtedness,
shares of any class or series of capital stock, cash or assets
(including securities, but excluding any rights or warrants referred
to in subparagraph (b), any dividend or distribution paid exclusively
in cash and any dividend or distribution referred to in subparagraph
(a) of this Section 205), the Conversion Price shall be reduced so
that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the effectiveness of
the Conversion Price reduction contemplated by this subparagraph (c)
by a fraction of which the numerator shall be the Current Market Price
per share of Company Common Stock on the date fixed for the payment of
such distribution (the "Reference Date") less the fair market value
(as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board
Resolution), on the Reference Date, of the portion of the evidences of
indebtedness, shares of capital stock, cash and assets so distributed
applicable to one share of Company Common Stock and the denominator
shall be such Current Market Price per share of Company Common Stock,
such reduction to become effective immediately prior to the opening of
business on the day following the Reference Date. In the event that
such dividend or distribution is not so paid or made, the Conversion
Price shall again be adjusted to be the Conversion Price that would
then be in effect if such dividend or distribution had not occurred.
For purposes of this subparagraph (c), any dividend or distribution
that includes shares of Company Common Stock or rights or warrants to
subscribe for or purchase shares of Company Common Stock shall be
deemed instead to be (i) a dividend or distribution of the evidences
of indebtedness, shares of capital stock, cash or assets other than
such shares of Company Common Stock or such rights or warrants (making
any Conversion Price reduction required by this subparagraph (c))
immediately followed by (ii) a dividend or distribution of such shares
of Company Common Stock or such rights or warrants (making any further
Conversion Price reduction required by subparagraph (a) or (b)),
except (A) the Reference Date of such dividend or distribution as
defined in this subparagraph shall be substituted as (x) "the record
date in the case of a dividend or other distribution," and (y) "the
record date for the determination of stockholders entitled to receive
such rights or warrants" and (z) "the date fixed for such
determination" within the meaning of subparagraphs (a) and (b) and (B)
any shares of Company Common Stock included in such dividend or
distribution
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shall not be deemed outstanding for purposes of computing any
adjustment of the Conversion Price in subparagraph (a).
(d) In case the Company shall pay or make a dividend or
other distribution on its Company Common Stock exclusively in cash
(excluding (i) all cash dividends, if the amount thereof does not
exceed the per share amount of the immediately preceding regular cash
dividend (as adjusted to reflect any of the events referred to in
subparagraphs (a), (b) or (c) of this Section), (ii) all cash
dividends, if the annualized amount thereof per share of Company
Common Stock does not exceed 12.5% of the Current Market Price per
share of Company Common Stock on the Trading Day immediately preceding
the date of declaration of such dividend and (iii) a redemption of any
Rights issued under a Rights Agreement), the Conversion Price shall be
reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the
effectiveness of the Conversion Price reduction contemplated by this
subparagraph (d) by a fraction of which the numerator shall be the
Current Market Price per share of Company Common Stock on the date
fixed for the payment of such distribution less the amount of cash so
distributed (excluding that portion of such distribution that does not
exceed 12.5% of the Current Market Price per share, determined as
provided above) applicable to one share of Company Common Stock and
the denominator shall be such Current Market Price per share of
Company Common Stock, such reduction to become effective immediately
prior to the opening of business on the day following the date fixed
for the payment of such distribution; provided, however, that in the
event the portion of the cash so distributed applicable to one share
of Company Common Stock is equal to or greater than the Current Market
Price per share of Company Common Stock on the record date mentioned
above (excluding that portion of such distribution that does not
exceed 12.5% of the Current Market Price per share, determined as
provided above), in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder of Series A Notes shall
have the right to receive upon conversion the amount of cash such
Holder would have received had such Holder converted each Series A
Notes immediately prior to the record date for the distribution of the
cash (less that portion of such distribution that does not exceed
12.5% of the Current Market Price per share, determined as provided
above). In the event that such dividend or distribution is not so paid
or made, the Conversion Price shall again be adjusted to be the
Conversion Price that would then be in effect if such record date had
not been fixed.
(e) In case a tender or exchange offer (other than an
odd-lot offer) made by the Company or any Subsidiary of the Company
for all or any portion of Company Common Stock shall expire and such
tender or exchange offer shall involve the payment by the Company or
such Subsidiary of consideration per share of Company Common Stock
having a fair market value (as determined in good faith by the Board
of Directors, whose determination shall be conclusive and described in
a Board Resolution) at the last time (the "Expiration Time") tenders
or exchanges may be made pursuant to such tender or exchange offer (as
it shall have been amended) that exceeds 110% of the Current Market
Price per share of Company Common Stock on the Trading Day next
succeeding the Expiration Time, the Conversion Price shall be reduced
so that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the effectiveness of
the Conversion Price reduction contemplated by this subparagraph (e)
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by a fraction of which the numerator shall be the number of shares of
Company Common Stock outstanding (including any tendered or exchanged
shares) at the Expiration Time (including the Purchased Shares) (as
defined below) multiplied by the Current Market Price per share of
Company Common Stock on the Trading Day next succeeding the Expiration
Time and the denominator shall be the sum of (x) the fair market value
(determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in
the terms of the tender or exchange offer) of all shares validly
tendered or exchanged and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to
as the "Purchased Shares") (excluding that portion of such
consideration that does not exceed 110% of the Current Market Price
per share) and (y) the product of the number of shares of Company
Common Stock outstanding (less any Purchased Shares) at the Expiration
Time and the Current Market Price per share of Company Common Stock on
the Trading Day next succeeding the Expiration Time, such reduction to
become effective immediately prior to the opening of business on the
day following the Expiration Time. In the event that such tender or
exchange offer is not so made, the Conversion Price shall again be
adjusted to be the Conversion Price that would then be in effect if
such record date had not been fixed.
(f) If the distribution date for any Rights of the
Company provided in any Rights Agreement occurs prior to the
Conversion Date, and a Holder of the Series A Notes who converts such
Series A Notes after such distribution date is not entitled to receive
the Rights that would otherwise be attached (but for the date of
conversion) to the shares of Company Common Stock received upon such
conversion, then an adjustment shall be made to the Conversion Price
pursuant to clause (ii) of Section 205(a) as if the Rights were being
distributed to holders of Company Common Stock immediately prior to
such conversion. If such an adjustment is made and the Rights are
later redeemed, invalidated or terminated, then a corresponding
reversing adjustment shall be made to the Conversion Price, on an
equitable basis, to take account of such event.
(g) The Company shall have the right to reduce from time
to time the Conversion Price by any amount selected by the Company for
any period of at least 20 days, provided, that the Company shall give
at least 15 days' written notice of such reduction to the Trustee and
the Property Trustee. The Company may, at its option, make such
reductions in the Conversion Price, in addition to those set forth
above in Section 205(a), as the Board of Directors deems advisable to
avoid or diminish any income tax to holders of Company Common Stock
resulting from any dividend or distribution of stock (or rights to
acquire stock) or from any event treated as such for United States
Federal income tax purposes.
(h) Notwithstanding anything to the contrary in this
Section 205, no adjustment of the Conversion Price will be made upon
the issuance of any shares of Company Common Stock (or securities
convertible or exchangeable for Company Common Stock), except as
specifically provided above, including pursuant to any present or
future plan providing for the reinvestment of dividends or interest
payable on securities of the Company and the investment of additional
optional amounts in shares of Company Common Stock under any such
plan, or the issuance of any shares of Company Common
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Stock or options or rights to purchase such shares pursuant to any
present or future employee benefit plan or program of the Company or
pursuant to any option, warrant, right, or exercisable, exchangeable
or convertible security that does not constitute an issuance to all
holders of Company Common Stock of rights or warrants entitling
holders of such rights or warrants to subscribe for or purchase
Company Common Stock at less than the Current Market Price. Further,
such issuances shall not be deemed to constitute an issuance of
Company Common Stock or exercisable, exchangeable or convertible
securities by the Company to which any of the adjustment provisions
described above applies. There shall also be no adjustment of the
Conversion Price in case of the issuance of any stock (or securities
convertible into or exchangeable for stock) of the Company except as
specifically described in this Article 2.
(i) If any action would require adjustment of the
Conversion Price pursuant to more than one of the provisions described
above, only one adjustment shall be made and such adjustment shall be
the amount of adjustment that has the highest absolute value to the
Holder of the Series A Notes. No adjustment in the Conversion Price
will be required unless such adjustment would require an increase or
decrease of at least 1% of the Conversion Price, but any adjustment
that would otherwise be required to be made shall be carried forward
and taken into account in a subsequent adjustment.
SECTION 206. Fundamental Change.
(a) In the event that the Company is a party to any
transaction including a merger (other than a merger that does not
result in a reclassification, conversion, exchange or cancellation of
Company Common Stock), consolidation, sale of all or substantially all
of the assets of the Company, recapitalization or reclassification of
Company Common Stock (other than a change in par value, or from par
value to no par value, or from no par value to par value or as a
result of a subdivision or combination of Company Common Stock) or any
compulsory share exchange (each of the foregoing being referred to as
a "Transaction"), in each case, as a result of which shares of Company
Common Stock shall be converted into the right to receive, or shall be
exchanged for the right to receive, (i) in the case of any Transaction
other than a Transaction involving a Common Stock Fundamental Change
(and subject to funds being legally available for such purpose under
applicable law at the time of such conversion), securities, cash or
other property, each Series A Note shall thereafter be convertible
into the kind and amount of securities, cash and other property
receivable upon the consummation of such Transaction by a holder of
that number of shares of Company Common Stock into which a Series A
Note was convertible immediately prior to such Transaction, or (ii) in
the case of a Transaction involving a Common Stock Fundamental Change,
common stock, each Series A Note shall thereafter be convertible (in
the manner described herein) into common stock of the kind received by
holders of Company Common Stock (but in each case after giving effect
to any adjustment discussed in paragraphs (b) and (c) relating to a
Fundamental Change if such Transaction constitutes a Fundamental
Change). The holders of Series A Notes or Preferred Securities will
have no voting rights with respect to any Transaction.
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(b) If any Fundamental Change occurs, then the Conversion
Price in effect will be adjusted immediately after such Fundamental
Change as described in paragraph (c) below. In addition, in the event
of a Common Stock Fundamental Change, each Series A Note shall be
convertible solely into common stock of the kind received by holders of
Company Common Stock as a result of such Common Stock Fundamental
Change.
(c) The Conversion Price in the case of any Transaction
involving a Fundamental Change will be adjusted immediately after such
Fundamental Change:
(i) in the case of a Non-Stock Fundamental Change,
the Conversion Price of the Series A Notes will thereupon
become the lower of (A) the Conversion Price in effect
immediately prior to such Non-Stock Fundamental Change, but
after giving effect to any other prior adjustments effected
pursuant to the preceding paragraphs, and (B) the result
obtained by multiplying the greater of the Applicable Price or
the then applicable Reference Market Price by a fraction of
which the numerator will be $50 and the denominator will be
(x) the amount of the Redemption Price for one Series A Note
if the Redemption Date were the date of such Non-Stock
Fundamental Change (or, for the period commencing on the first
date of original issuance of the Series A Notes and through
_________, 2001, and the twelve-month periods commencing
_________, 2001 and _________, 2002, the product of _____%,
_____% and _____%, respectively, multiplied by $50) plus (y)
any then accrued and unpaid interest on one Series A Note; and
(ii) in the case of a Common Stock Fundamental
Change, the Conversion Price of the Series A Notes in effect
immediately prior to such Common Stock Fundamental Change, but
after giving effect to any other prior adjustments effected
pursuant to the preceding paragraphs, will thereupon be
adjusted by multiplying such Conversion Price by a fraction of
which the numerator will be the Purchaser Stock Price and the
denominator will be the Applicable Price; provided, however,
that in the event of a Common Stock Fundamental Change in
which (A) 100% of the value of the consideration received by a
holder of Company Common Stock is common stock of the
successor, acquiror or other third party (and cash, if any, is
paid only with respect to any fractional interests in such
common stock resulting from such Common Stock Fundamental
Change) and (B) all of Company Common Stock will have been
exchanged for, converted into or acquired for common stock
(and cash with respect to fractional interests) of the
successor, acquiror or other third party, the Conversion Price
of the Series A Notes in effect immediately prior to such
Common Stock Fundamental Change will thereupon be adjusted by
multiplying such Conversion Price by a fraction of which the
numerator will be one and the denominator will be the number
of shares of common stock of the successor, acquiror or other
third party received by a holder of one share of Company
Common Stock as a result of such Common Stock Fundamental
Change.
SECTION 207. Notice of Adjustments of Conversion Price. Whenever the
Conversion Price is adjusted as herein provided:
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(a) the Company shall compute the adjusted Conversion Price
and shall prepare a certificate signed by the Chief Financial Officer
or the Treasurer of the Company setting forth the adjusted Conversion
Price and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall forthwith be filed with
the Trustee, the Conversion Agent and the transfer agent for the
Preferred Securities and the Series A Notes; and
(b) a notice stating that the Conversion Price has been
adjusted and setting forth the adjusted Conversion Price shall as soon
as practicable be mailed by the Company to all record holders of
Preferred Securities and the Series A Notes at their last addresses as
they appear upon the stock transfer books of the Company and the Trust
and the Securities Registrar.
SECTION 208. Prior Notice of Certain Events. In case:
(a) the Company shall (i) declare any dividend (or any other
distribution) on its Company Common Stock, other than (A) a dividend
payable in shares of Company Common Stock or (B) a dividend payable in
cash that would not require an adjustment pursuant to Section 205(c) or
(d) or (ii) authorize a tender or exchange offer that would require an
adjustment pursuant to Section 205(e);
(b) the Company shall authorize the granting to all holders of
Company Common Stock of rights or warrants to subscribe for or purchase
any shares of stock of any class or series or of any other rights or
warrants;
(c) of any reclassification of Company Common Stock (other
than a subdivision or combination of the outstanding Company Common
Stock, or a change in par value, or from par value to no par value, or
from no par value to par value), or of any consolidation or merger to
which the Company is a party and for which approval of stockholders of
the Company shall be required (except solely as a result of the rules
of the New York Stock Exchange or the NASD), or of the sale or transfer
of all or substantially all of the assets of the Company or of any
compulsory share exchange whereby Company Common Stock is converted
into other securities, cash or other property; or
(d) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company;
then the Company shall (A) if any Preferred Securities are outstanding under the
Trust Agreement, cause to be filed with the transfer agent for the Preferred
Securities, and shall cause to be mailed to the holders of record of the
Preferred Securities, at their last addresses as they shall appear upon the
stock transfer books of the Trust or (B) shall cause to be mailed to all Holders
at their last addresses as they shall appear in the Security Register, at least
15 days prior to the applicable record or effective date hereinafter specified,
a notice stating (x) the date on which a record (if any) is to be taken for the
purpose of such dividend, distribution, rights or warrants or, if a record is
not to be taken, the date as of which the holders of Company Common Stock of
record to be entitled to such dividend, distribution, rights or warrants are to
be determined or (y) the date on which such reclassification, consolidation,
merger, sale, transfer,
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share exchange, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Company
Common Stock of record shall be entitled to exchange their shares of Company
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer, share exchange,
dissolution, liquidation or winding up (but no failure to mail such notice or
any defect therein or in the mailing thereof shall affect the validity of the
corporate action required to be specified in such notice).
SECTION 209. Certain Additional Rights. In case the Company shall, by
dividend or otherwise, declare or make a distribution on its Company Common
Stock referred to in Section 205(c) or 205(d) (including dividends or
distributions referred to in the last sentence of Section 205(c)), the Holders
of the Series A Notes, upon the conversion thereof subsequent to the close of
business on the date fixed for the determination of stockholders entitled to
receive such distribution and prior to the effectiveness of the Conversion Price
adjustment (such that the Conversion Price is not adjusted with respect to such
distribution) in respect of such distribution, shall also be entitled to receive
for each share of Company Common Stock into which the Series A Notes are
converted, the portion of the shares of Company Common Stock, rights, warrants,
evidences of indebtedness, shares of capital stock, cash and assets so
distributed applicable to one share of Company Common Stock; provided, however,
that, at the election of the Company (whose election shall be evidenced by a
Board Resolution) with respect to all Holders so converting, the Company may, in
lieu of distributing to such Holder any portion of such distribution not
consisting of cash or securities of the Company, pay such Holder an amount in
cash equal to the fair market value thereof (as determined in good faith by the
Board of Directors, whose determination shall be conclusive and described in a
Board Resolution). If any conversion of Series A Notes described in the
immediately preceding sentence occurs prior to the payment date for a
distribution to holders of Company Common Stock that the Holder of Series A
Notes so converted is entitled to receive in accordance with the immediately
preceding sentence, the Company may elect (such election to be evidenced by a
Board Resolution) to distribute to such Holder a due xxxx for the shares of
Company Common Stock, rights, warrants, evidences of indebtedness, shares of
capital stock, cash or assets to which such Holder is so entitled, provided,
that such due xxxx (i) meets any applicable requirements of the principal
national securities exchange or other market on which Company Common Stock is
then traded and (ii) requires payment or delivery of such shares of Company
Common Stock, rights, warrants, evidences of indebtedness, shares of capital
stock, cash or assets no later than the date of payment or delivery thereof to
holders of shares of Company Common Stock receiving such distribution.
SECTION 210. Restrictions on Company Common Stock Issuable Upon
Conversion.
(a) Shares of Company Common Stock to be issued upon
conversion of a Series A Note in respect of Preferred Securities shall
bear such restrictive legends as the Company may provide in accordance
with applicable law.
(b) If shares of Company Common Stock to be issued upon
conversion of a Series A Note in respect of Preferred Securities are to
be registered in a name other than that of the Holder of such Preferred
Security, then the Person in whose name such shares
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of Company Common Stock are to be registered must deliver to the
Conversion Agent a certificate satisfactory to the Company and signed
by such Person, as to compliance with the restrictions on transfer
applicable to such Preferred Security. Neither the Trustee nor any
Conversion Agent or Securities Registrar shall be required to register
in a name other than that of the Holder of such Preferred Securities
shares of Company Common Stock issued upon conversion of any such
Series A Note in respect thereof not so accompanied by a properly
completed certificate.
SECTION 211. Trustee Not Responsible for Determining Conversion Price
or Adjustments. Neither the Trustee nor any Conversion Agent shall at any time
be under any duty or responsibility to any Holder of any Series A Note or to any
holder of a Preferred Security to determine whether any facts exist that may
require any adjustment of the Conversion Price, or with respect to the nature or
extent of any such adjustment when made, or with respect to the method employed,
or herein or in any supplemental indenture provided to be employed, in making
the same. Neither the Trustee nor any Conversion Agent shall be accountable with
respect to the validity or value (or the kind of account) of any shares of
Company Common Stock or of any securities or property, which may at any time be
issued or delivered upon the conversion of any Series A Note; and neither the
Trustee nor any Conversion Agent makes any representation with respect thereto.
Neither the Trustee nor any Conversion Agent shall be responsible for any
failure of the Company to make any cash payment or to issue, transfer or deliver
any shares of Company Common Stock or stock certificates or other securities or
property upon the surrender of any Series A Note for the purpose of conversion,
or, except as expressly herein provided, to comply with any of the covenants of
the Company contained in Article 10 of the Original Indenture or this Article 2.
ARTICLE 3
MISCELLANEOUS PROVISIONS
SECTION 301. Recitals by Company. The recitals in this First
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 of Series A Notes and of this First Supplemental Indenture
as fully and with like effect as if set forth herein in full.
SECTION 302. Ratification and Incorporation of Original Indenture. As
supplemented hereby, the Original Indenture is in all respects ratified and
confirmed, and the Original Indenture, as heretofore supplemented and modified,
and this First Supplemental Indenture shall be read, taken and construed as one
and the same instrument.
SECTION 303. Executed in Counterparts. This First Supplemental
Indenture 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.
SECTION 304. Listing of Series A Notes. If the Series A Notes are to be
issued as a Global Security in connection with the distribution of the Series A
Notes to the Holders of the
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Preferred Securities issued by the Trust, the Company will use its best efforts
to list such Series A Notes on the New York Stock Exchange or any such other
exchange on which such Preferred Securities are then listed and traded.
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IN WITNESS WHEREOF, each party hereto has caused this instrument to be
signed in its name and behalf by its duly authorized officers, all as of the day
and year first above written.
ATTEST: SOUTHERN ENERGY, INC.
By: By:
------------------------------ ----------------------------
Secretary Vice President
ATTEST: BANKERS TRUST COMPANY
By: By:
------------------------------- -------------------------------
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EXHIBIT A
FORM OF SERIES A NOTE
NO. CUSIP NO.
------ --------
THE INDEBTEDNESS EVIDENCED BY THIS SECURITY IS, TO THE EXTENT PROVIDED IN THE
INDENTURE, SUBORDINATE AND SUBJECT IN RIGHT OF PAYMENT TO THE PRIOR PAYMENT IN
FULL OF ALL SENIOR INDEBTEDNESS AND THIS SECURITY IS ISSUED SUBJECT TO THE
PROVISIONS OF THE INDENTURE WITH RESPECT THERETO.
SOUTHERN ENERGY, INC.
% JUNIOR CONVERTIBLE SUBORDINATED NOTE, SERIES A
---- DUE 2030
Principal Amount: $
----------
Regular Record Date: 15th calendar day prior to Interest Payment Date
Original Issue Date: , 2000
----------
Stated Maturity: , 2030
----------
Interest Payment Dates: , , and
---------- ---------- ---------- ----------
Interest Rate: % per annum
----------
Authorized Denomination: $50
Initial Redemption Date: , 2003
----------
Southern Energy, Inc., a Delaware corporation (the "Company", which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to
_____________________________________, or registered assigns, the principal sum
of _________ DOLLARS ($__________) on the Stated Maturity shown above (or upon
earlier redemption or any shortened Maturity), and to pay interest thereon from
the Original Issue Date shown above, or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, quarterly in arrears
on each Interest Payment Date as specified above, commencing on the Interest
Payment Date next succeeding the Original Issue Date shown above and on Maturity
(or upon earlier redemption) at the rate per annum shown
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above until the principal hereof is paid or made available for payment and on
any overdue principal and on any overdue installment of interest. The interest
so payable, and punctually paid or duly provided for, on any Interest Payment
Date (other than an Interest Payment Date that is Maturity or on a Redemption
Date) will, as provided in such Indenture, be paid to the Person in whose name
this Note (the "Note") is registered on the Regular Record Date for such
Interest Payment Date, provided that any interest payable at Maturity or on any
Redemption Date will be paid to the Person to whom principal is payable. Except
as otherwise provided in the Indenture, any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this Note
is registered at the close of business on a Special Record Date for the payment
of such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Notes of this series not less than 10 days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange, if any, on which
the Notes of this series shall be listed, and upon such notice as may be
required by any such exchange, all as more fully provided in the Indenture.
Payments of interest on this Note will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this Note
shall be computed and paid on the basis of a 360-day year of twelve 30-day
months. If the amount of interest is calculated for any period shorter than a
full quarterly interest period, it will be computed on the basis of the number
of days elapsed on a 360-day year. In the event that any date on which interest
is payable on this Note is not a Business Day, then payment of the interest
payable on such date will be made on the next succeeding day that is a Business
Day without any interest or other payment resulting from such delay, except
that, if such Business Day is in the next succeeding calendar year, payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date the payment was originally payable.
A "Business Day" shall mean any day other than a Saturday or a Sunday or a day
on which banking institutions in New York City are authorized or required by law
or executive order to remain closed or a day on which the Corporate Trust Office
of the Trustee or the principal corporate trust office of the Property Trustee
of the Trust are closed for business.
So long as no Event of Default has occurred and is continuing, the
Company shall have the right at any time and from time to time during the term
of this Note to extend the interest payment period of such Note for up to 20
consecutive quarters but not beyond the Stated Maturity of this Note (each, an
"Extension Period"), during which periods unpaid interest (together with
interest thereon) will compound quarterly at the Interest Rate ("Deferred
Interest"). Upon the termination of each Extension Period, which shall be an
Interest Payment Date, the Company shall pay all Deferred Interest to the Person
in whose name this Note is registered at the close of business on the Regular
Record Date for such Interest Payment Date, provided that any Deferred Interest
payable at Maturity or on any Redemption Date will be paid to the Person to whom
principal is payable. Prior to the termination of any such Extension Period, the
Company may extend the interest payment period, provided that such Extension
Period together with all such previous and further extensions thereof shall not
exceed 20 consecutive quarters. Upon the termination of any such Extension
Period, and the payment of all accrued and unpaid interest and any Additional
Interest then due, the Company may select a new Extension Period, subject to the
above requirements. If the Company shall have given notice of
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its election to select any Extension Period, the Company shall not, subject to
certain exceptions provided in the Indenture, (i) declare or pay any dividend or
distribution on, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock, or make any guarantee payments with
respect to the foregoing, and (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt securities
(including guarantees other than its guarantee of the Trust Securities issued by
the Trust) issued by the Company that rank pari passu with or junior to this
Note. The Company shall give the Trustee, the Property Trustee and the
Administrative Trustees notice of its selection or extension of an Extension
Period at least one Business Day prior to the earlier of (i) the Regular Record
Date relating to the Interest Payment Date on which the Extension Period is to
commence or relating to the Interest Payment Date on which an Extension Period
that is being extended would otherwise terminate, or (ii) the date the Property
Trustee (or if no Preferred Securities are outstanding, the Trustee) is required
to give notice to the New York Stock Exchange or other applicable
self-regulatory organization of the record date or the date distributions are
payable.
The Company also shall be obligated to pay when due and without
extension all additional amounts as may be required so that the net amount
received and retained by the Holder of this Note (if the Holder is a Securities
Trust) after paying taxes, duties, assessments or governmental charges of
whatever nature (other than withholding taxes) imposed by the United States or
any other taxing authority will not be less than the amounts such Holder would
have received had no such taxes, duties, assessments or other governmental
charges been imposed.
Payment of the principal of and interest (including Additional
Interest, if any) due at Maturity or earlier redemption of the Series A Notes
shall be made upon surrender of the Series A Notes at the Corporate Trust Office
of the Trustee, in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.
Payment of interest (including interest on an Interest Payment Date) will be
made, subject to such surrender where applicable, at the option of the Company,
(i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register or (ii) by wire transfer at such
place and to such account at a banking institution in the United States as may
be designated in writing to the Trustee at least 16 days prior to the date for
payment by the Person entitled thereto.
The indebtedness evidenced by this Note is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Note is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Note, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so provided, and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes. Each
Holder hereof, by his acceptance hereof, waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR
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ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: , 20
---------- --
SOUTHERN ENERGY, INC.
By:
-------------------------------------
Attest:
-----------------------------
Assistant Secretary
{Seal of SOUTHERN ENERGY, INC. appears here}
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CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
BANKERS TRUST COMPANY,
as Trustee
By:
-----------------------------------
Authorized Officer
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(Reverse Side of Note)
This Note is one of a duly authorized issue of Junior Subordinated
Notes of the Company (the "Notes"), issued and issuable in one or more series
under a Subordinated Note Indenture, dated as of _________, 2000, as
supplemented by the First Supplemental Indenture, dated ________, 2000 (the
"Indenture"), between the Company and Bankers Trust Company, as Trustee (the
"Trustee," which term includes any successor trustee under the Indenture), to
which Indenture and all indentures incidental thereto reference is hereby made
for a statement of the respective rights, limitation of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the Notes
issued thereunder and of the terms upon which said Notes are, and are to be,
authenticated and delivered. This Note is one of the series designated on the
face hereof as ____% Junior Convertible Subordinated Notes, Series A due
_________, 2030 (the "Series A Notes") in the aggregate principal amount of up
to $__________. Capitalized terms used herein for which no definition is
provided herein shall have the meanings set forth in the Indenture.
If a Tax Event occurs, then the Company will have the right (a) prior
to the dissolution of the Trust, to shorten the Stated Maturity of this Note to
the minimum extent required, but not earlier than _________, 2015, or (b) to
direct the Property Trustee to dissolve the Trust (if not previously dissolved)
and shorten the Stated Maturity of this Note to the minimum extent required, but
not earlier than _________, 2015, in each case such that in the Opinion of
Counsel experienced in such matters, after shortening the Stated Maturity,
interest paid on the Note will be deductible by the Company for federal income
tax purposes.
The Company shall have the right, subject to the terms and conditions
of the Indenture, to redeem this Note at any time on or after __________, 2003
at the option of the Company, without premium or penalty, in whole or in part.
In case of such optional redemption, the Redemption Price shall equal the
following prices expressed in percentages of the principal amount together with
accrued interest to but excluding the date fixed for redemption. If redeemed
during the 12-month period beginning __________, ____;
YEAR REDEMPTION PRICE
--------- ----------------
[to come]
Upon the occurrence of a Special Event at any time, the Company may, within 90
days following the occurrence thereof and subject to the terms and conditions of
the Indenture, redeem this Note without premium or penalty, in whole, at a
Redemption Price equal to 100% of the principal amount thereof plus accrued and
unpaid interest, including any Additional Interest, if any, to the Redemption
Date. A Special Event may be a Tax Event or an Investment Company Act Event.
"Tax Event" means that the Company shall have received an Opinion of Counsel
experienced in such matters to the effect that, as a result of (a) any amendment
to, or change (including any announced prospective change) in, laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein; (b) any amendment to, or change in, an
interpretation or application of such laws or regulations by any legislative
body, court,
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governmental agency or regulatory authority (including the enactment of any
legislation and the publication of any judicial decision or regulatory
determination); (c) any interpretation or pronouncement by any legislative body,
court, governmental agency or regulatory authority that provides for a position
with respect to such laws or regulations that differs from its previous position
or a commonly accepted position; or (d) any action taken by any governmental
agency or regulatory authority, there is more than an insubstantial risk that
(i) the Trust is, or will be within 90 days of the date of the Opinion of
Counsel, subject to United States federal income tax with respect to income
accrued or received on the Series A Notes, (ii) interest payable by the Company
on the Series A Notes is not, or will not be within 90 days of the date of the
Opinion of Counsel, deductible by the Company for United States federal income
tax purposes, (iii) the timing of the deduction for interest payable by the
Company on the Series A Notes is, or will be within 90 days of the date of the
Opinion of Counsel, required to be made by reference to a system that defers the
timing of such deductions compared to the timing permitted under the principles
of economic accrual; or (iv) the Trust would be subject to more than a de
minimis amount of other taxes, duties or other governmental charges, which
change or amendment becomes effective on or after the Original Issue Date.
"Investment Company Act Event" means that the Company shall have received an
Opinion of Counsel to the effect that, as a result of the occurrence of a change
(including prospective change) in law or regulation or a change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Trust is or will be considered an "investment
company" that is required to be registered under the Investment Company Act of
1940, as amended, which change becomes effective on or after the Original Issue
Date.
In the event of redemption of this Note in part only, a new Note or
Notes of this series for the unredeemed portion hereof will be issued in the
name of the Holder hereof upon the surrender hereof. The Series A Notes will not
have a sinking fund.
At any time, the Company shall have the right to dissolve the Trust and
cause this Note to be exchanged for Preferred Securities in dissolution of the
Trust after satisfaction of liabilities to creditors of the Trust as provided by
applicable law. The Company may also exchange this Note for Preferred Securities
upon the occurrence of a Special Event.
Subject to and upon compliance with the provisions of the Indenture and
subject to the Company's right to elect a cash settlement as set forth below,
this Note is convertible, at the option of the Holder, at any time on or after
_________, 2001 and prior to the redemption or Maturity, into fully paid and
nonassessable shares of Company Common Stock at an initial conversion rate of
______ shares of Company Common Stock for each $50 in aggregate principal amount
of this Note (equal to a conversion price of approximately $___ per share of
Company Common Stock), subject to adjustment as described in the Indenture. The
Holder of this Note may convert any portion hereof that is called for
redemption. In case the Note or portion hereof is called for redemption, such
conversion right shall expire at the close of business on the Redemption Date,
unless the Company defaults in making the payment due upon redemption. At any
time after ___________, 2001 and prior to the Spin-Off, the Company may elect to
make a cash settlement in respect of this Note if surrendered for conversion by
delivering notice thereof to the Holder not more than five Trading Days after
the Note is surrendered for conversion.
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If an Event of Default with respect to the Notes of this series shall
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be affected
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of not less than a majority in principal amount of the Notes at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Notes of each series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable in the Security Register,
upon surrender of this Note for registration of transfer at the office or agency
of the Company for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes of this series, of
authorized denominations and of like tenor and for the same aggregate principal
amount, will be issued to the designated transferee or transferees. No service
charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Note is registered as the owner hereof for all
purposes, whether or not this Note be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Notes of this series are issuable only in registered form without
coupons in denominations of $50 and any integral multiple thereof. As provided
in the Indenture and subject to certain limitations therein set forth, Notes of
this series are exchangeable for a like aggregate principal amount of Notes of
this series of a different authorized denomination, as requested by the Holder
surrendering the same upon surrender of the Note or Notes to be exchanged at the
office or agency of the Company.
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The Company, and by its acceptance of this Note or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Note agree that for United States federal, state and local tax
purposes it is intended that this Note constitute indebtedness.
This Note shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM- as tenants in UNIF GIFT MIN ACT- Custodian
common ------- ---------
TEN ENT- as tenants by the (Cust) (Minor)
entireties under Uniform Gifts to
JT TEN- as joint tenants Minors Act
with right of
survivorship and -----------------------
not as tenants (State)
in common
Additional abbreviations may also be
used though not on the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
________________________________________________________________________________
(please insert Social Security or other identifying number of assignee)
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
________________________________________________________________________________
________________________________________________________________________________
agent to transfer said Note on the books of the Company, with full power of
substitution in the premises.
Dated:
------------------ --------------------------------------------------
--------------------------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular without
alteration or enlargement, or any change whatever.
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NOTICE OF CONVERSION
To: Southern Energy, Inc.
The undersigned owner of this Note hereby irrevocably exercises the
option to convert this Note, or the portion below designated, into Common Stock
of SOUTHERN ENERGY, INC. in accordance with the terms of the Indenture referred
to in this Note, and directs that the shares issuable and deliverable upon
conversion, together with any check in payment for fractional shares, be issued
in the name of and delivered to the undersigned, unless a different name has
been indicated in the assignment below. If shares are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto.
Any Holder, upon the exercise of its conversion rights in accordance
with the terms of the Indenture and the Note, agrees to be bound by the terms of
any Rights Agreement relating to Company Common Stock issuable upon conversion
of the Note.
Date: ,
------------ ----
Portion of Note to be converted ($50 or integral multiples thereof):
in whole in part
---- ----
$
------------
----------------------------------------
Signature (for conversion only)
Please Print or Typewrite Name and
Address, Including Zip Code, and Social
Security or Other Identifying Number
-----------------------------------------
-----------------------------------------
-----------------------------------------
Signature Guarantee:
------------------------------
Signature must be guaranteed by an institution that is a member of one
of the following recognized Signature Guaranty Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP); or
(iv) in such other guarantee programs acceptable to the Trustee.
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EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
BANKERS TRUST COMPANY,
as Trustee
By:
------------------------------------
Authorized Officer
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