THE AES CORPORATION, as Issuer
and THE BANK OF NEW YORK, as Trustee ____________________
INDENTURE
Dated as of July 17, 1997 ____________________ $325,000,000
8 3/8% Senior Subordinated Notes due 2007
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- ---------
Section 310(a)(1).............................................. 7.10
(a)(2).............................................. 7.10
(a)(3).............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b)................................................. 7.8; 7.10;
10.2
(c)................................................. N.A.
Section 311(a)................................................. 7.11
(b)................................................. 7.11
(c)................................................. N.A.
Section 312(a)................................................. 2.5
(b)................................................. 10.3
(c)................................................. 10.3
Section 313(a)................................................. 7.6
(b)(1).............................................. 7.6
(b)(2).............................................. 7.6
(c)................................................. 7.6; 10.2
(d)................................................. 7.6
Section 314(a) ................................................ 4.6; 4.7;
10.2
(b)................................................. N.A.
(c)(1).............................................. 10.4
(c)(2).............................................. 10.4
(c)(3).............................................. 10.4
(d)................................................. N.A.
(e)................................................. 10.5
(f)................................................. N.A.
Section 315(a)................................................. 7.1(b)
(b)................................................. 7.5; 10.2
(c)................................................. 7.1(a)
(d)................................................. 7.1(c)
(e)................................................. 6.11
Section 316(a) (last sentence)................................. 2.9
(a)(1)(A)........................................... 6.5
(a)(1)(B) .......................................... 6.4
(a)(2).............................................. N.A.
(b)................................................. 6.6, 6.7
(c)................................................. 9.4
Section 317(a)(1).............................................. 6.8
(a)(2).............................................. 6.9
(b)................................................. 2.4
---------------
N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of this Indenture.
Section 318(a)................................................. 10.1
(c)................................................. 10.1
---------------
N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of this Indenture.
TABLE OF CONTENTS
------------------
Page
----
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.................................... 1
SECTION 1.2 Incorporation by Reference of Trust
Indenture Act................................ 24
SECTION 1.3 Rules of Construction.......................... 25
ARTICLE II
THE SECURITIES
SECTION 2.1 Form and Dating................................ 25
SECTION 2.2 Execution and Authentication................... 27
SECTION 2.3 Registrar and Paying Agent..................... 28
SECTION 2.4 Paying Agent To Hold Money in Trust............ 29
SECTION 2.5 Securityholder Lists........................... 29
SECTION 2.6 Transfer and Exchange.......................... 29
SECTION 2.7 Replacement Securities......................... 39
SECTION 2.8 Temporary Securities........................... 40
SECTION 2.9 Cancellation................................... 41
SECTION 2.10 Defaulted Interest............................. 41
SECTION 2.11 CUSIP or CINS Number........................... 42
SECTION 2.12 Payments of Interest........................... 42
SECTION 2.13 Outstanding Securities......................... 43
SECTION 2.14 Treasury Securities............................ 44
ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.1 Right of Redemption............................ 44
SECTION 3.2 Applicability of Article....................... 44
SECTION 3.3 Election To Redeem; Notice to Trustee.......... 44
-i-
Page
----
SECTION 3.4 Selection by Trustee of Securities
To Be Redeemed............................... 45
SECTION 3.5 Notice of Redemption........................... 45
SECTION 3.6 Deposit of Redemption Price.................... 46
SECTION 3.7 Securities Payable on Redemption
Date......................................... 46
SECTION 3.8 Securities Redeemed in Part.................... 46
ARTICLE IV
COVENANTS
SECTION 4.1 Payment of Securities......................... 47
SECTION 4.2 Maintenance of Office or Agency............... 47
SECTION 4.3 Corporate Existence........................... 48
SECTION 4.4 Limitation on Business........................ 48
SECTION 4.5 Limitation on Restricted Subsidiary
Investments and Mergers..................... 48
SECTION 4.6 Compliance Certificates....................... 49
SECTION 4.7 Reports....................................... 49
SECTION 4.8 Limitation on Debt............................ 50
SECTION 4.9 Limitation on Restricted Subsidiary
Debt........................................ 52
SECTION 4.10 Limitation on Additional Tiers of
Senior Subordinated Debt.................... 55
SECTION 4.11 Change of Control............................. 55
SECTION 4.12 Limitation on Transactions with
Affiliates.................................. 57
SECTION 4.13 Limitation on Restricted Payments............. 58
SECTION 4.14 Limitation on Dividend and other
Payment Restrictions Affecting
Subsidiaries................................ 61
SECTION 4.15 Limitation on Asset Dispositions.............. 63
ARTICLE V
SUCCESSOR CORPORATION
SECTION 5.1 Merger, Consolidation, Etc.................... 68
SECTION 5.2 Successor Entity Substituted.................. 69
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.1 Events of Default............................. 69
-ii-
Page
----
SECTION 6.2 Acceleration.................................. 72
SECTION 6.3 Other Remedies................................ 72
SECTION 6.4 Waiver of Past Default........................ 73
SECTION 6.5 Control by Majority........................... 73
SECTION 6.6 Limitation on Suits........................... 73
SECTION 6.7 Rights of Holders To Receive
Payment..................................... 74
SECTION 6.8 Collection Suit by Trustee.................... 74
SECTION 6.9 Trustee May File Proofs of Claim.............. 75
SECTION 6.10 Priorities.................................... 75
SECTION 6.11 Undertaking for Costs......................... 76
SECTION 6.12 Rights and Remedies Cumulative................ 76
SECTION 6.13 Delay or Omission Not Waiver.................. 76
SECTION 6.14 Restoration of Rights and Remedies............ 76
ARTICLE VII TRUSTEE
SECTION 7.1 Duties of Trustee............................. 77
SECTION 7.2 Rights of Trustee............................. 78
SECTION 7.3 Individual Rights of Trustee.................. 79
SECTION 7.4 Trustee's Disclaimer.......................... 80
SECTION 7.5 Notice of Defaults............................ 80
SECTION 7.6 Reports by Trustee to Holders................. 80
SECTION 7.7 Compensation and Indemnity.................... 80
SECTION 7.8 Replacement of Trustee........................ 82
SECTION 7.9 Successor Trustee by Xxxxxx, Etc.............. 83
SECTION 7.10 Eligibility; Disqualification................. 83
SECTION 7.11 Preferential Collection of Claims
Against Company............................. 83
ARTICLE VIII
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
SECTION 8.1 Satisfaction and Discharge of
Indenture................................... 84
SECTION 8.2 Application by Trustee of Funds
Deposited for Payment of
Securities.................................. 85
SECTION 8.3 Repayment of Moneys Held by Paying
Agent....................................... 85
-iii-
Page
----
SECTION 8.4 Return of Moneys Held by Trustee
and Paying Agent Unclaimed for
Two Years................................... 86
SECTION 8.5 Defeasance and Discharge o
Indenture................................... 86
SECTION 8.6 Defeasance of Certain Obligation.............. 88
SECTION 8.7 Reinstatement................................. 89
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders.................... 90
SECTION 9.2 With Consent of Holders....................... 91
SECTION 9.3 Compliance with Trust Indenture
Act......................................... 92
SECTION 9.4 Revocation and Effect of Consents............. 92
SECTION 9.5 Notation on or Exchange of
Securities.................................. 93
SECTION 9.6 Trustee to Sign Amendments, Etc............... 93
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Trust Indenture Act Controls.................. 93
SECTION 10.2 Notices....................................... 94
SECTION 10.3 Communications by Holders with
Other Holders............................... 95
SECTION 10.4 Certificate and Opinion of Counsel
as to Conditions Precedent.................. 95
SECTION 10.5 Statements Required in Certificate
and Opinion of Counsel...................... 96
SECTION 10.6 Rules by Trustee, Paying Agent,
Registrar................................... 96
SECTION 10.7 Legal Holidays................................ 96
SECTION 10.8 GOVERNING LAW................................. 96
SECTION 10.9 No Recourse Against Others.................... 97
SECTION 10.10 Successors.................................... 97
SECTION 10.11 Counterparts.................................. 97
SECTION 10.12 Severability.................................. 97
SECTION 10.13 Table of Contents, Headings, Etc.............. 97
SECTION 10.14 No Adverse Interpretation of Other
Agreements.................................. 97
SECTION 10.15 Benefits of Indenture......................... 98
SECTION 10.16 Independence of Covenants..................... 98
-iv-
ARTICLE XI
SUBORDINATION OF SECURITIES
SECTION 11.1 Agreement to Subordinate...................... 98
SECTION 11.2 Payments to Securityholders................... 98
SECTION 11.3 Subrogation of Securities..................... 101
SECTION 11.4 Authorization by Securityholders.............. 102
SECTION 11.5 Notice to Trustee............................. 102
SECTION 11.6 Trustee's Relation to Senior Debt............. 103
SECTION 11.7 No Impairment of Subordination................ 104
SIGNATURES S-1
EXHIBIT A - Form of Security
EXHIBIT B - Form of Certificate of Transfer
EXHIBIT C - Form of Certificate of Exchange
-v-
-1-
INDENTURE dated as of July 17, 1997, between THE AES CORPORATION, a
Delaware corporation, as Issuer (the "Company"), and THE BANK OF NEW YORK, a New
York banking corporation, as Trustee (the "Trustee").
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of the 8 3/8% Senior Subordinated Notes
due 2007 of the Company (the "Securities") to be issued as provided for in this
Indenture. All things necessary to make the Securities, when duly issued and
executed by the Company and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid, binding
agreement of the Company, in accordance with their respective terms, have been
done.
The parties hereto agree as follows for the benefit of each other and
for the equal and ratable benefit of the Holders:
ARTICLE I_______________________________________________________________________
________________________________________________________________________________
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.
"Acquisition Debt" means Debt of any Person existing at the time such
Person became a Restricted Subsidiary of the Company (or such Person is merged
into the Company or one of its Restricted Subsidiaries) or assumed in connection
with the acquisition of assets from any such Person (other than assets acquired
in the ordinary course of business), including Debt Incurred in connection with,
or in contemplation of, such Person becoming a Restricted Subsidiary of the
Company (but excluding Debt of such Person which is extinguished, retired or
repaid in connection with such Person becoming a Restricted Subsidiary of the
Company).
"Additional Interest" shall have the meaning set forth in the
Registration Rights Agreement.
"Adjusted Consolidated Net Income" means, for any period, for any
Person the aggregate Net Income (or loss) of such Person and its Consolidated
Subsidiaries for such period determined in conformity with GAAP plus the Net
Income of any Restricted Subsidiary of such Person for prior periods to the
extent such Net Income is actually paid in cash to such Person during such
period plus the Net Income of any Person (other than a Restricted Subsidiary) in
which such Person has a joint interest with a third party for prior periods to
the extent such Net Income is actually paid in cash to such Person during
-2-
such period; provided that the following items shall be excluded in computing
Adjusted Consolidated Net Income (without duplication): (i) the Net Income (or
loss) of any Person (other than a Restricted Subsidiary) in which such Person
has a joint interest with a third party, except to the extent such Net Income is
actually paid in cash to such Person during such period; (ii) solely for the
purposes of calculating the amount of Restricted Payments that may be made
pursuant to clauses (c)(1) or (c)(2) of Section 4.13 (and in such case, except
to the extent includible pursuant to clause (i) above), the Net Income (if
positive) of such Person accrued prior to the date it becomes a Restricted
Subsidiary of any other Person or is merged into or consolidated with such other
Person or any of its Restricted Subsidiaries or all or substantially all of the
property and assets of such Person are acquired by such other Person or any of
its Restricted Subsidiaries; (iii) the Net Income (or loss) of any Restricted
Subsidiary of such Person, except to the extent such Net Income (if positive) is
actually paid in cash to such Person during such period; (iv) any gains or
losses (on an after-tax basis) attributable to Asset Sales; (v) the cumulative
effect of a change in accounting principle; and (vi) any amounts paid or accrued
as dividends on Preferred Stock of such Person or Preferred Stock of any
Restricted Subsidiary of such Person.
"AES Hawaii" means AES Hawaii Management Co., Inc., a Delaware
corporation and a Subsidiary of the Company, and its successors.
"AES Oklahoma" means AES Oklahoma Management Co., Inc., a Delaware
corporation and a Subsidiary of the Company, and its successors. "Affiliate"
means, as applied to any Person, any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with") when used with respect to any Person is defined to mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Paying Agent, transfer agent or
Authenticating Agent.
"Applicable Procedures" means, with respect to any transfer or exchange
of interests in a Global Security, the rules and procedures of DTC, Euroclear or
Cedel that apply to such transfer or exchange.
-3-
"Asset Acquisition" means (i) an investment by the Company or any of
its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary of the Company or any of its Restricted
Subsidiaries or shall be merged into or consolidated with the Company or any of
its Restricted Subsidiaries or (ii) an acquisition by the Company or any of its
Restricted Subsidiaries of the Property of any Person other than the Company or
any of its Restricted Subsidiaries that constitutes substantially all of an
operating unit or business of such Person.
"Asset Disposition" means, with respect to any Person, any sale,
transfer, conveyance, lease or other disposition (including by way of merger,
consolidation or sale-leaseback) by such Person or any of its Restricted
Subsidiaries to any Person (other than to such Person or a Consolidated
Subsidiary of such Person and other than in the ordinary course of business) of
(i) any assets (excluding cash and cash equivalents) of such Person or any of
its Restricted Subsidiaries or (ii) any shares of Capital Stock of such Person's
Restricted Subsidiaries. For purposes of this definition, any disposition in
connection with directors' qualifying shares or investments by foreign nationals
mandated by applicable law shall not constitute an Asset Disposition. In
addition, the term "Asset Disposition" shall not include any sale, transfer,
conveyance, lease or other disposition of assets governed by Section 5.1. The
term "Asset Disposition" also shall not include (i) any sale of shares of
Preferred Stock of a Restricted Subsidiary, (ii) the grant of a security
interest by any Person in any assets or shares of Capital Stock securing a
borrowing by, or contractual performance obligation of, such Person or any
Restricted Subsidiary of such Person, (iii) a sale-leaseback transaction
involving substantially all of the assets of a Power Supply Business where a
Restricted Subsidiary of the Company sells the Power Supply Business to a Person
in exchange for the assumption by that Person of the Debt financing the Power
Supply Business and the Restricted Subsidiary leases the Power Supply Business
from such Person, (iv) dispositions of contract rights, development rights and
resource data made in connection with the initial development of a Power Supply
Business, made prior to the commencement of commercial operation of such Power
Supply Business or (v) transactions made in order to enhance the repatriation of
cash proceeds in connection with a Foreign Asset Disposition or in order to
increase the after-tax proceeds thereof available for immediate distribution.
"Asset Sale" means the sale or other disposition by the Company or any
of its Restricted Subsidiaries (other than to the Company or another Restricted
Subsidiary of the Company) of (i) all or substantially all of the Capital Stock
of any Restricted Subsidiary of the Company or (ii) all or
-4-
substantially all of the Property that constitutes an operating unit or business
of the Company or any of its Restricted Subsidiaries.
"Average Life" means, at any date of determination with respect to any
debt security, the quotient obtained by dividing (i) the sum of the product of
(A) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security multiplied by (B)
the amount of such principal payment by (ii) the sum of all such principal
payments.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar Federal
or state law for the relief, reorganization, adjustment or recomposition of
debtors.
"Bank Agent" means Xxxxxx Guaranty Trust Company of New York, as agent
for the Banks pursuant to the Bank Credit Agreement, and any successor or
successors thereto in such capacity.
"Bank Credit Agreement" means the Credit Agreement dated as of August
2, 1996 among the Company, the Banks named on the signature pages thereof and
the Bank Agent, as such agreement has been and may be amended, restated,
supplemented or otherwise modified from time to time, and includes any agreement
extending the maturity of, or restructuring (including, but not limited to, the
inclusion of additional borrowers thereunder that are Restricted Subsidiaries of
the Company and whose obligations are guaranteed by the Company thereunder) all
or any portion of, the Debt under such agreement or any successor agreements and
includes any agreement with one or more banks or other lending institutions
refinancing all or any portion of the Debt under such agreement or any successor
agreements.
"Banks" means the lenders who are from time to time parties to the Bank
Credit Agreement.
"Board of Directors" means either the Board of Directors of the Company
or (except for the purposes of clause (iii) of the definition of "Change of
Control") any committee of such Board duly authorized to act hereunder.
"Board Resolution" means one or more resolutions of the Board of
Directors, certified by the secretary or an assistant secretary to have been
duly adopted and to be in full force and effect on the date of certification,
and delivered to the Trustee.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which
-5-
banking institutions are authorized or required by law or regulation to close in
The City of New York.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of, or interests in (however designated), the equity of
such Person which is outstanding or issued on or after the Closing Date,
including, without limitation, all Common Stock and Preferred Stock and
partnership and joint venture interests of such Person.
"Capitalized Lease" means, as applied to any Person, any lease of any
Property of which the discounted present value of the rental obligations of such
Person as lessee, in conformity with GAAP, is required to be capitalized on the
balance sheet of such Person; and "Capitalized Lease Obligation" is defined to
mean the rental obligations, as aforesaid, under such lease.
"Cedel" means Cedel Bank, societe anonyme.
"Change of Control" means the occurrence of one or more of the
following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company to any Person or group (as that term is used in
Section 13(d)(3) of the Exchange Act) of Persons, (ii) a Person or group (as so
defined) of Persons (other than management of the Company on the date of this
Indenture or their Affiliates) shall have become the beneficial owner of more
than 35% of the outstanding Voting Stock of the Company, or (iii) during any
one-year period, individuals who at the beginning of such period constitute the
Board of Directors (together with any new director whose election or nomination
was approved by a majority of the directors then in office who were either
directors at the beginning of such period or who were previously so approved)
cease to constitute a majority of the Board of Directors.
"Change of Control Offer" has the meaning provided in Section 4.11.
"Closing Date" means the date on which the Securities are originally
issued under this Indenture.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the TIA, then the body performing such duties at
such time.
-6-
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of common stock of such Person which is outstanding or
issued on or after the date of this Indenture, including, without limitation,
all series and classes of such common stock.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article V of this Indenture
and thereafter means the successor.
"Consolidated EBITDA" of any Person for any period means the Adjusted
Consolidated Net Income of such Person, plus (without duplication) (i) income
taxes (other than income taxes (x) (either positive or negative) attributable to
extraordinary and non-recurring gains or losses or Asset Sales and (y) actually
payable with respect to such period) determined on a consolidated basis for such
Person and its Consolidated Subsidiaries in accordance with GAAP to the extent
payable by such Person, (ii) Consolidated Fixed Charges, (iii) depreciation and
amortization expense for such period and prior periods, all determined on a
consolidated basis for such Person and its Consolidated Subsidiaries in
accordance with GAAP, but only to the extent that the positive cash flow
associated with such depreciation and amortization expense is actually received
in cash by such Person during such period and (iv) all other non-cash items
reducing Net Income for such period and prior periods, all determined on a
consolidated basis for such Person and its Consolidated Subsidiaries in
accordance with GAAP, but only to the extent that the positive cash flow
associated with such non-cash items is actually received in cash by such Person
during such period, and less (without duplication) (i) all non-cash items
increasing Net Income of such Person during such period and prior periods, but
only to the extent that positive cash flow associated with such non-cash items
in not actually received in cash by such Person during such period, and (ii) the
aggregate amount of any capitalized expenses (including capitalized interest)
paid by such Person during such period which have the effect of increasing Net
Income for such period.
"Consolidated Fixed Charges" of any Person means, for any period, the
aggregate of (i) Consolidated Interest Expense, (ii) the interest component of
Capitalized Leases, determined on a consolidated basis for such Person and its
Consolidated Subsidiaries in accordance with GAAP, excluding any interest
component of Capitalized Leases in respect of that portion of a Capitalized
Lease Obligation of a Restricted Subsidiary that is Non-Recourse to such Person
and (iii) cash and non-cash dividends due (whether or not declared) on any
Redeemable Stock of such Person.
-7-
"Consolidated Interest Expense" of any Person means, for any period,
the aggregate interest expense in respect of Debt (including amortization of
original issue discount and non-cash interest payments or accruals) of such
Person and its Consolidated Subsidiaries, determined on a consolidated basis in
accordance with GAAP, including all commissions, discounts, other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs associated with Interest Rate Agreements and any amounts paid
during such period in respect of such interest expense, commissions, discounts,
other fees and charges that have been capitalized; provided that Consolidated
Interest Expense of the Company shall not include any interest expense
(including all commissions, discounts, other fees and charges owed with respect
to letters of credit and bankers' acceptance financing and net costs associated
with Interest Rate Agreements) in respect of that portion of Debt of a
Restricted Subsidiary of the Company that is Non-Recourse to the Company; and
provided further that Consolidated Interest Expense of the Company in respect of
a Guarantee by the Company of Debt of a Restricted Subsidiary shall be equal to
the commissions, discounts, other fees and charges that would be due with
respect to a hypothetical letter of credit issued under the Bank Credit
Agreement that can be drawn by the beneficiary thereof in the amount of the Debt
so guaranteed if (i) the Company is not actually making directly or indirectly
interest payments on such Debt and (ii) GAAP does not require the Company on an
unconsolidated basis to record such Debt as a liability of the Company.
"Consolidated Subsidiary" means at any date with respect to any Person,
any Subsidiary of such Person or other entity the accounts of which would be
consolidated with those of such Person in its consolidated financial statements
if such statements were prepared as of such date, other than an Unrestricted
Subsidiary.
"Consolidated Total Assets" means, with respect to any Person at any
time, the total assets of such Person and its Consolidated Subsidiaries at such
time determined in conformity with GAAP.
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
administered, which office is, at the date of this Indenture, located at 000
Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Currency Agreement" means, with respect to any Person, any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement designed to protect such Person or any of its Restricted
Subsidiaries against
-8-
fluctuations in currency values to or under which such Person or any of
its Restricted Subsidiaries is a party or a beneficiary on the Closing Date or
becomes a party or a beneficiary thereafter.
"Debt" means, with respect to any Person at any date of determination
(without duplication), (i) all indebtedness of such Person for borrowed money,
(ii) all obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments, (iii) all obligations of such Person in respect of
letters of credit or bankers' acceptance or other similar instruments (or
reimbursement obligations with respect thereto), (iv) all obligations of such
Person to pay the deferred purchase price of property or services, except Trade
Payables, (v) all obligations of such Person as lessee under Capitalized Leases,
(vi) all Debt of others secured by a Lien on any asset of such Person, whether
or not such Debt is assumed by such Person; provided that, for purposes of
determining the amount of any Debt of the type described in this clause, if
recourse with respect to such Debt is limited to such asset, the amount of such
Debt shall be limited to the lesser of the fair market value of such asset or
the amount of such Debt, (vii) all Debt of others Guaranteed by such Person to
the extent such Debt is Guaranteed by such Person, (viii) all Redeemable Stock
valued at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends and (ix) to the extent not otherwise included
in this definition, all obligations of such Person under Currency Agreements and
Interest Rate Agreements.
"Default" means any Event of Default as defined in Section 6.1 and any
event that is, or after notice or passage of time or both would be, an Event of
Default.
"Defaulted Interest" has the meaning specified in Section 2.10.
"Designated Senior Debt" means (i) Debt under the Bank Credit Agreement
and (ii) Debt constituting Senior Debt which, at the time of its determination,
(A) has an aggregate principal amount of at least $30 million and (B) is
specifically designated in the instrument evidencing such Senior Debt as
"Designated Senior Debt" by the Company.
"DTC" means The Depository Trust Company or its successors.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York (Brussels
Office) as operator of the Euroclear system.
"Event of Default" has the meaning provided in Section 6.1.
-9-
"Excess Cash Flow" of any Person for any period means Consolidated
EBITDA less Consolidated Fixed Charges less any income taxes actually paid by
such Person during such period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Registration Statement" shall have the meaning set forth in
the Registration Rights Agreement.
"Finance Subsidiary" means a Wholly-Owned Subsidiary of the Company
that does not engage in any activity other than (i) the holding of Debt of the
Company that both (x) is subordinated to the Securities and (y) provides for no
payments of principal by way of sinking fund, mandatory redemption or otherwise
prior to the maturity of the Securities, (ii) the issuance of Capital Stock and
(iii) any activity necessary, incidental or related to the foregoing.
"Fixed Charge Ratio" means the ratio, on a pro forma basis, of (i) the
aggregate amount of Consolidated EBITDA of any Person for the Reference Period
immediately prior to the date of the transaction giving rise to the need to
calculate the Fixed Charge Ratio (the "Transaction Date") to (ii) the aggregate
Consolidated Fixed Charges of such Person during such Reference Period; provided
that for purposes of such computation, in calculating Consolidated EBITDA and
Consolidated Fixed Charges, (1) the Incurrence of the Debt giving rise to the
need to calculate the Fixed Charge Ratio and the application of the proceeds
therefrom shall be assumed to have occurred on the first day of the Reference
Period, (2) Asset Sales and Asset Acquisitions which occur during the Reference
Period or subsequent to the Reference Period and prior to the Transaction Date
(but including any Asset Acquisition to be made with the Debt Incurred pursuant
to clause (1) above) shall be assumed to have occurred on the first day of the
Reference Period, (3) the Incurrence of any Debt during the Reference Period or
subsequent to the Reference Period and prior to the Transaction Date and the
application of the proceeds therefrom shall be assumed to have occurred on the
first day of such Reference Period, (4) Consolidated Interest Expense
attributable to any Debt (whether existing or being Incurred) computed on a pro
forma basis and bearing a floating interest rate shall be computed as if the
rate in effect on the date of computation had been the applicable rate for the
entire period unless such Person or any of its Restricted Subsidiaries is a
party to an Interest Rate Agreement (which shall remain in effect for the twelve
month period after the Transaction Date) which has the effect of fixing the
interest rate on the date of computation, in which case such rate (whether
higher or lower) shall be used and (5) there shall be excluded from Consolidated
Fixed Charges any Consolidated Fixed Charges related to any
-10-
amount of Debt which was outstanding during and subsequent to the Reference
Period but is not outstanding on the Transaction Date, except for Consolidated
Fixed Charges actually incurred with respect to Debt borrowed (as adjusted
pursuant to clause (4)) (x) under a revolving credit or similar arrangement to
the extent the commitment thereunder remains in effect on the Transaction Date
or (y) pursuant to clause (iv) of Section 4.8(b). For the purpose of making this
computation, Asset Sales and Asset Acquisitions which have been made by any
Person which has become a Restricted Subsidiary of the Company or been merged
with or into the Company or any Restricted Subsidiary of the Company during the
Reference Period or subsequent to the Reference Period and prior to the
Transaction Date shall be calculated on a pro forma basis (including all of the
calculations referred to in clauses (1) through (5) above assuming such Asset
Sales or Asset Acquisitions occurred on the first day of the Reference Period).
"Foreign Asset Disposition" means any Asset Disposition in respect of
the Capital Stock and/or Property of any Restricted Subsidiary of any Person
where such Restricted Subsidiary is organized under the laws of any jurisdiction
other than the U.S. or any state thereof or any Restricted Subsidiary of the
type described in Section 936 of the Internal Revenue Code of 1986, as amended,
to the extent that the proceeds of such Asset Disposition are received by a
Person subject in respect of such proceeds to the tax laws of a jurisdiction
other than the U.S. or any state thereof.
"GAAP" means generally accepted accounting principles in the U.S. as in
effect as of the date of this Indenture applied on a basis consistent with the
principles, methods, procedures and practices employed in the preparation of the
Company's audited financial statements, including, without limitation, those set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession.
"Global Security" means the global security, without coupons,
representing all or a portion of the Securities deposited with DTC,
substantially in the form of Exhibit A attached hereto.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Debt or other obligation of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase
-11-
or payment of) such Debt or other obligation of such other Person (whether
arising by virtue of partnership arrangements, or by agreement to keepwell, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for purposes
of assuring in any other manner the obligee of such Debt or other obligation of
the payment thereof or to protect such obligee against loss in respect thereof
(in whole or in part); provided that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Holder", "holder of Securities", "Securityholder" and other similar
terms mean the registered holder of any Security.
"Incur" means, with respect to any Debt, to incur, create, issue,
assume, Guarantee or otherwise become liable for or with respect to, or become
responsible for, the payment of, contingently or otherwise, such Debt; provided
that neither the accrual of interest (whether such interest is payable in cash
or kind) nor the accretion of original issue discount shall be considered an
Incurrence of Debt.
"Indenture" means this Indenture as originally executed and delivered
or as it may be amended or supplemented from time to time pursuant to the terms
hereof.
"Independent Financial Advisor" means a nationally recognized
investment banking firm (i) which does not (and whose directors, officers,
employees and Affiliates do not) have a direct or indirect material financial
interest in the Company and (ii) which, in the sole judgment of the Board of
Directors, is otherwise independent and qualified to perform the task for which
such firm is being engaged.
"Initial Global Securities" means the Regulation S Global Securities
and the 144A Global Securities, each of which contains a Securities Act Legend.
"Initial Securities" means the Securities containing a Securities Act
Legend.
"Interest Payment Date," when used with respect to any Security, means
the stated maturity of an installment of interest specified in such Security.
"Interest Rate Agreement" means, with respect to any Person, any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate
-12-
collar agreement, interest rate hedge agreement or other similar agreement or
arrangement designed to protect such Person or any of its Restricted
Subsidiaries against fluctuations in interest rates to or under which such
Person or any of its Restricted Subsidiaries is a party or a beneficiary on the
date of the Indenture or becomes a party or a beneficiary thereafter.
"Intermediate Holding Company" means any Restricted Subsidiary of the
Company that serves as a holding company for the Company's direct or indirect
interests in Power Supply Businesses and Unrelated Businesses.
"Investment" in a Person means any investment in, loan or advance to,
Guarantee on behalf of, directly or indirectly, or other transfer of assets to
such Person. For purposes of the definition of "Unrestricted Subsidiary" and
Section 4.13, "Investment" shall include (i) the fair market value of the assets
(net of liabilities) of any Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary and shall exclude
the fair market value of the assets (net of liabilities) of any Unrestricted
Subsidiary at the time that such Unrestricted Subsidiary is designated a
Restricted Subsidiary and (ii) any property transferred to or from any Person
shall be valued at its fair market value at the time of such transfer, in each
case as determined by the Board of Directors in good faith.
"Investment Grade" means, with respect to any security, a rating of
Baa3 or higher of such security by Xxxxx'x Investors Service Inc. together with
a rating of BBB- or higher of such security by Standard & Poor's Corporation.
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
that, as to any such arrangement in corporate form, such corporation shall not,
as to any Person of which such corporation is a Subsidiary, be considered to be
a Joint Venture to which such Person is a party.
"Legal Holiday" means any day other than a Business Day.
"Lien" means, with respect to any Property, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Indenture, the Company shall be deemed to own
subject to a Lien any Property which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such Property.
-13-
"Material AES Entity" means (i) any Subsidiary Guarantor, (ii) any of
AES Connecticut Management Co., Inc., AES Thames, Inc., AES Barbers Point, Inc.
and AES Shady Point, Inc. and (iii) any other Person in which the Company has a
direct or indirect equity Investment if such Person's contribution to
Consolidated EBITDA of the Company for the four most recently completed fiscal
quarters of the Company constitutes 15% or more of the Consolidated EBITDA of
the Company for such period, in each case, other than an Unrestricted
Subsidiary.
"Material Subsidiary" of a Person means, as of any date, any Restricted
Subsidiary that would constitute a "significant subsidiary" within the meaning
of Article 1 of Regulation S-X.
"Maturity Date," when used with respect to any Security, means the date
specified in such Security as the fixed date on which the final installment of
principal of such Security is due and payable (in the absence of any
acceleration thereof pursuant to Section 6.2 or any Change of Control Offer
pursuant to Section 4.11).
"Net Cash Proceeds" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
and when received (including any cash received upon sale or disposition of such
note or receivable), excluding any other consideration received in the form of
assumption by the acquiring Person of Debt or other obligations relating to the
Property disposed of in such Asset Disposition or received in any other noncash
form) therefrom, in each case, net of all legal, title and recording tax
expenses, commissions and other fees and expenses incurred (including, without
limitation, consent and waiver fees and any applicable premiums, earn-out or
working interest payments or payments in lieu or in termination thereof), and
all federal, state, provincial, foreign and local taxes required to be accrued
as a liability under GAAP (i) as a consequence of such Asset Disposition, (ii)
as a result of the repayment of any Debt in any jurisdiction other than the
jurisdiction where the Property disposed of was located or (iii) as a result of
any repatriation to the U.S. of any proceeds of such Asset Disposition, and in
each case net of a reasonable reserve for the after tax-cost of any
indemnification payments (fixed and contingent) attributable to seller's
indemnities to the purchaser undertaken by the Company or any of its Restricted
Subsidiaries in connection with such Asset Disposition (but excluding any
payments, which by the terms of the indemnities will not, under any
circumstances, be made during the term of the Securities), and net of all
payments made on any Debt which is secured by such Property, in
-14-
accordance with the terms of any Lien upon or with respect to such Property or
which must by its terms or by applicable law be repaid out of the proceeds from
such Asset Disposition, and net of all distributions and other payments made to
minority interest holders in Restricted Subsidiaries or Joint Ventures as a
result of such Asset Disposition.
"Net Income" of any Person for any period means the net income (loss)
of such Person for such period, determined in accordance with GAAP, except that
extraordinary and non-recurring gains and losses as determined in accordance
with GAAP shall be excluded.
"Net Worth" of any Person means, as of any date, the aggregate of
capital, surplus and retained earnings (including any cumulative translation
adjustment) of such Person and its Consolidated Subsidiaries as would be shown
on a consolidated balance sheet of such Person and its Consolidated Subsidiaries
prepared as of such date in accordance with GAAP.
"Non-Recourse" to a Person as applied to any Debt (or portion thereof)
means that such Person is not directly or indirectly liable to make any payments
with respect to such Debt (or portion thereof), that no Guarantee of such Debt
(or portion thereof) has been made by such Person and that such Debt (or portion
thereof) is not secured by a Lien on any asset of such Person.
"Offering Memorandum" means the offering memorandum dated July 14, 1997
relating to the Securities.
"Officer" means, with respect to the Company, the chairman of the board
of directors, the president or chief executive officer, any vice president, the
chief financial officer, the treasurer or any assistant treasurer, or the
secretary or any assistant secretary.
"Officers' Certificate" means a certificate signed in the name of the
Company (i) by the chairman of the board of directors, the president or chief
executive officer or a vice president and (ii) by the chief financial officer,
the treasurer or any assistant treasurer, or the secretary or any assistant
secretary, complying with Section 10.5 and delivered to the Trustee. Each such
certificate shall comply with Section 314 of the TIA and include (except as
otherwise expressly provided in this Indenture) the statements provided in
Section 10.5.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Company or who may be other
counsel. Each such opinion shall comply with Section 314 of the TIA and include
the
-15-
statements provided in Section 10.5, if and to the extent required thereby.
"original issue date" of any Security (or portion thereof) means the
earlier of (a) the date of authentication of such Security or (b) the date of
any Security (or portion thereof) for which such Security was issued (directly
or indirectly) on registration of transfer, exchange or substitution.
"Original Issue Discount Security" means any Security that provides for
an amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof pursuant to Section 6.1.
"Participant" means, with respect to DTC, Euroclear or Cedel, a Person
who has an account with DTC, Euroclear or Cedel, respectively (and, with respect
to DTC, it shall include Euroclear or Cedel).
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.
"Payment Blockage Period" shall have the meaning set forth in Section
11.2.
"Permitted Investment" means any Investment of the type specified in
clauses (iv) or (vi) of the definition of Restricted Payment which is made
directly or indirectly by the Company and its Restricted Subsidiaries; provided
that (i) at the time such Investment is made, the Company could Incur at least
$1 of Debt under Section 4.8(a); (ii) at the time such Investment is made, no
Event of Default or event that, after the giving of notice or lapse of time or
both would become an Event of Default, shall have occurred and be continuing;
(iii) after giving effect to the Investment, the aggregate Investments made by
the Company and its Restricted Subsidiaries in the applicable Person and in any
other Persons that have a direct or indirect interest in the same Power Supply
Business or Unrelated Business does not exceed 40% of the Net Worth of the
Company as of the end of its most recently ended fiscal quarter; (iv) the Person
in which the Investment is made is engaged only in the businesses described in
Section 4.4; and (v) the Company directly or through its Restricted Subsidiaries
either (x) controls, under an operating and management agreement or otherwise,
the day to day management and operation of any Power Supply Business or
Unrelated Business of the Person in which the Investment is made or (y) has
significant influence over the management and operation of any such Power Supply
Business or Unrelated Business in connection with such management or operation.
To the extent that an Investment is
-16-
not a Permitted Investment only because the aggregate investment limitation in
clause (iii) above is not satisfied, such Investment shall be treated as a
Permitted Investment to the extent of the limitation and any excess Investment
shall be subject to the other restrictions of Section 4.13.
"Permitted Payments" means with respect to the Company or any of its
Restricted Subsidiaries (i) any dividend on shares of Capital Stock payable (or
to the extent paid) solely in shares of Capital Stock (other than Redeemable
Stock) or in options, warrants or other rights to purchase Capital Stock (other
than Redeemable Stock) and any distribution of Capital Stock (other than
Redeemable Capital Stock) in respect of the exercise of any right to convert or
exchange any instrument (whether Debt or equity and including Redeemable Stock);
(ii) any dividend or other distribution payable to the Company by any of its
Restricted Subsidiaries or by a Restricted Subsidiary to another Restricted
Subsidiary; (iii) the repurchase or other acquisition or retirement for value of
any shares of the Company's Capital Stock, or any option, warrant or other right
to purchase shares of the Company's Capital Stock with additional shares of, or
out of the proceeds of a substantially contemporaneous issuance of, Capital
Stock other than Redeemable Stock (unless the redemption provisions of such
Redeemable Stock prohibit the redemption thereof prior to the date on which the
Capital Stock to be acquired or retired was by its terms required to be
redeemed); (iv) any defeasance, redemption, repurchase or other acquisition for
value of any Debt which by its terms ranks pari passu with, or subordinate in
right of payment to the Securities with the proceeds from the issuance of (x)
Debt which is also pari passu with the Securities or subordinate to the
Securities at least to the extent and in the manner as the Debt to be defeased,
redeemed, repurchased or otherwise acquired is subordinate in right of payment
to, the Securities; provided that such new pari passu or subordinated Debt
provides for no payments of principal by way of sinking fund, mandatory
redemption or otherwise (including defeasance) by the Company (including,
without limitation, at the option of the holder thereof other than an option
given to a holder pursuant to a "change of control" or "limitation on asset
sale" covenant which is no more favorable to the holders of such Debt than the
provisions contained in the Debt being replaced or, if none, Sections 4.11 and
4.15) prior to the maturity of Debt being replaced and the proceeds of such new
pari passu or subordinated Debt are utilized for such purpose within 45 days of
issuance or (y) Capital Stock (other than Redeemable Stock); (v) in respect of
any actual payment on account of an Investment which is not fixed in amount at
the time when made, the amount determined by the Board of Directors to be a
Restricted Payment on the date such Investment was originally deemed to have
been made (the "Original Restricted Payment Charge") plus an amount equal to
-17-
the interest on a hypothetical investment in a principal amount equal to the
Original Restricted Payment Charge assuming interest at the rate of 7% per annum
compounded annually for a period beginning on the date the Investment was
originally deemed to have been made and ending with respect to any portion of
the Original Restricted Payment Charge actually paid on the date of actual
payment, less any actual payments previously made on account of such Investment;
provided that the Permitted Payment under this clause (v) shall in no event
exceed the payment actually made; (vi) the declaration and payment of dividends
to holders, or any payment on account of the purchase, redemption, retirement or
acquisition for value, of any class or series of Redeemable Stock; or (vii) a
Permitted Investment.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Physical Securities" means those Securities issued pursuant to Section
2.6(a).
"Power Supply Business" means an electric power or thermal energy
generation or cogeneration facility or related facilities, or electric power
transmission, distribution, fuel supply or fuel transportation facilities, or
any combination thereof, all subject to related security interests under related
project financing arrangements, together with its or their related power supply,
thermal energy and fuel contracts as well as other contractual arrangements with
customers, suppliers and contractors.
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of preferred or preference stock of such Person
which is outstanding or issued on or after the date of this Indenture.
"Principal" of a Security means the principal amount of, and, unless
the context indicates otherwise, includes any premium payable on, the Security.
"Private Exchange Securities" shall have the meaning set forth in the
Registration Rights Agreement.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person under GAAP.
-18-
"Qualified Capital Stock" means any Capital Stock of a Person that is
not Redeemable Stock.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Redeemable Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Securities, (ii) redeemable at the option of the
holder of such class or series of Capital Stock at any time prior to the Stated
Maturity of the Securities or (iii) convertible into or exchangeable for (unless
solely at the option of the Company) Capital Stock referred to in clause (i) or
(ii) above or Debt having a scheduled maturity prior to the Stated Maturity of
the Securities; provided that any Capital Stock that would not constitute
Redeemable Stock but for provisions thereof giving holders thereof the right to
require the Company to repurchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or a "change of control" occurring prior to the
Stated Maturity of the Securities shall not constitute Redeemable Stock if the
"asset sale" or "change of control" provision applicable to such Capital Stock
is no more favorable to the holders of such Capital Stock than the provisions
contained in Sections 4.11 and 4.15, and such Capital Stock specifically
provides that the Company will not repurchase or redeem any such Capital Stock
pursuant to such provisions prior to the Company's repurchase of Securities
required to be repurchased by the Company under Sections 4.11 and 4.15.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture and such Security.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture and such Security.
"Reference Period" means the four fiscal quarters for which financial
information is available preceding the date of a transaction giving rise to the
need to make a financial calculation.
"Registrar" has the meaning provided in Section 2.3.
"Registration Rights Agreement" means the Registration Rights Agreement
dated the date hereof among the Company, the X.X. Xxxxxx Securities Inc.,
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and Salomon Brothers Inc.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the or
-19-
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
"Regulation S" means Regulation S promulgated under the Securities Act
(including any successor registration thereto) as it may be amended from time to
time.
"Repurchase Date" shall have the meaning provided in Section 4.11.
"Responsible Officer" when used with respect to the Trustee means any
officer of the Trustee assigned by the Trustee to administer its corporate trust
matters.
"Restricted Payment" means, with respect to any Person, (i) any
dividend or other distribution on any shares of such Person's Capital Stock;
(ii) any payment on account of the purchase, redemption, retirement or
acquisition for value of such Person's Capital Stock; (iii) any defeasance,
redemption, repurchase or other acquisition or retirement for value prior to
scheduled maturity of any Debt subordinated in right of payment to the
Securities and having a maturity date after the maturity of the Securities; (iv)
any Investment in a Restricted Subsidiary after the occurrence of an event of
default, as defined in any indenture or instrument evidencing or under which
such Restricted Subsidiary has at the date of this Indenture or shall thereafter
have outstanding any Debt, shall happen and be continuing; (v) any Investment in
an Unrestricted Subsidiary; (vi) any Investment made in an Affiliate (other than
a Person that constitutes an Affiliate solely because of the Company's, or a
Restricted Subsidiary of the Company's, control of such Person) and (vii) the
conversion of such Person's Capital Stock into Debt of such Person or its
Restricted Subsidiaries. Notwithstanding the foregoing, "Restricted Payment"
shall not include any Permitted Payment.
"Restricted Physical Security" means a Physical Security containing a
Securities Act Legend.
"Restricted Subsidiary" means any Subsidiary other than an Unrestricted
Subsidiary.
"Rule 144" shall have the meaning set forth in the Registration Rights
Agreement.
"Rule 144A" shall have the meaning set forth in the Registration Rights
Agreement.
"SEC" means the Securities and Exchange Commission.
-20-
"Security" or "Securities" means any Security or Securities, as the
case may be, authenticated and delivered under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means the principal of (and premium, if any) and interest
on all Debt of the Company whether created, incurred or assumed before, on or
after the date of the issuance of the Securities; provided that Senior Debt
shall not include (i) the Company's 9 3/4% Senior Subordinated Notes due 2000
and 10 1/4% Senior Subordinated Notes due 2006 which rank pari passu to the
Securities, (ii) Debt of the Company to any Affiliate, (iii) Debt that, when
incurred and without respect to any election under Section 1111(b) of Title 11,
United States Code, was without recourse to the Company, (iv) any other Debt of
the Company which by the terms of the instrument creating or evidencing the same
are specifically designated as not being senior in right of payment to the
Securities and (v) Redeemable Stock of the Company.
"Shelf Registration Statement" shall have the meaning set forth in the
Registration Rights Agreement.
"Significant Subsidiary" of a Person means, as of any date, any
Restricted Subsidiary which has two or more of the following attributes: (i) it
contributes 20% or more of such Person's Excess Cash Flow for its most recently
completed fiscal quarter or (ii) it contributes 15% or more of Net Income before
tax of such Person and its Consolidated Subsidiaries for such Person's most
recently completed fiscal quarter or (iii) it constitutes 20% or more of
Consolidated Total Assets of such Person at the end of such Person's most
recently completed fiscal quarter.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 2.10.
"Stated Maturity" means, with respect to any debt security or any
installment of interest thereon, the date specified in such debt security as the
fixed date on which any principal of such debt security or any such installment
of interest is due and payable.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which a majority of the Capital Stock or other ownership
interests having ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at the time directly
or indirectly owned by such Person.
-21-
"Subsidiary Guarantors" means (i) prior to the first day, if any, on
which the Company's long-term debt is rated BBB- or higher by Standard & Poor's
Corporation and Baa3 or higher by Xxxxx'x Investors Services, Inc., AES Oklahoma
and AES Hawaii, and (ii) on and after such first day, if any, AES Hawaii.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (0)(0)
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in
Section 9.3.
"Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Restricted
Subsidiaries arising in the ordinary course of business in connection with the
acquisition of goods or services.
"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article VII and thereafter means such successor.
"Unrelated Business" means any business not of the same general type
now conducted by the Company and its Restricted Subsidiaries.
"Unrestricted Global Securities" means one or more Global Securities
that do not and are not required to bear the Securities Act Legend.
"Unrestricted Physical Securities" means one or more Physical
Securities that do not and are not required to bear the Securities Act Legend.
"Unrestricted Securities" means the Securities that do not and are not
required to bear the Securities Act Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Restricted
Subsidiary (including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on any property of, the Company or
any Restricted Subsidiary that is not a Subsidiary of the Subsidiary to be so
designated, provided that (A) any Guarantee by the Company or any Restricted
Subsidiary of any Debt of the Subsidiary being so designated shall be deemed an
"Incurrence" of such Debt and an "Investment" by the Company or such
-22-
Restricted Subsidiary (or both, if applicable) at the time of such designation;
(B) either (I) the Subsidiary to be so designated has total assets of $1,000 or
less or (II) if such Subsidiary has assets greater than $1,000, such designation
would be permitted under Section 4.13 and (C) if applicable, the Incurrence of
Debt and the Investment referred to in clause (A) of this proviso would be
permitted under Sections 4.9 and 4.13. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that immediately
after giving effect to such designation (x) all Liens and Debt of such
Unrestricted Subsidiary outstanding immediately after such designation would, if
Incurred at such time, have been permitted to be incurred for all purposes of
this Indenture and (y) no Default or Event of Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced to
the Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing provisions.
"U.S. Government Obligations" means securities which are (i) direct
obligations of the U.S. for the payment of which its full faith and credit is
pledged or (ii) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the U.S. the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the U.S.,
which, in either case, are not callable or redeemable at the option of the
issuer thereof, and shall also include a depository receipt issued by a bank or
trust company as custodian with respect to any such U.S. Government Obligations
or a specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of interest on or principal
of the U.S. Government Obligation evidenced by such depository receipt.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors
of such Person.
"Wholly-Owned Subsidiary" means, with respect to any Person, any
Restricted Subsidiary of such Person if all the Capital Stock or other ownership
interests in such Restricted Subsidiary having ordinary voting power to elect
the entire board of directors or entire group of other persons performing
similar functions (other than any director's qualifying shares
-23-
or Investments by foreign nationals mandated by applicable law) is owned
directly or indirectly by such Person.
SECTION 1.2 Incorporation by Reference
of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The following
terms used in this Indenture that are defined in the TIA have the following
meanings:
(a) "Commission" means the SEC;
(b) "indenture securities" means the Securities;
(c) "indenture security holder" means a Securityholder;
(d) "indenture to be qualified" means this Indenture;
(e) "indenture trustee" or "institutional trustee" means the Trustee;
and
(f) "obligor" on the indenture securities means the Company or any
other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by reference in the TIA to another statute or defined by the Securities
Act or the Exchange Act and not otherwise defined herein have the meanings so
assigned to them therein.
SECTION 1.3 Rules of Construction.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and words in the plural
include the singular;
(d) provisions apply to successive events and transactions;
(e) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
Subdivision; and
-24-
(f) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP.
ARTICLE II
THE SECURITIES
SECTION 2.1 Form and Dating.
(a) Global Securities. Securities offered and sold to QIBs in reliance
on Rule 144A shall be issued initially substantially in the form of Exhibit A
hereto in the name of Cede & Co. as nominee of DTC, duly executed by the Company
and authenticated by the Trustee as hereinafter provided. Any such Security
shall be referred to herein as the "144A Global Security." Securities offered
and sold in reliance on Regulation S shall be issued initially substantially in
the form of Exhibit A hereto in the name of Cede & Co. as nominee of DTC, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. Any such Security shall be referred to herein as the "Regulation S
Global Security." Unrestricted Global Securities shall be issued initially in
accordance with Sections 2.6(b)(iv), 2.6(c)(ii) and 2.6(e) in the name of Cede &
Co. as nominee of DTC, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount of each Global
Security may from time to time be increased or decreased by adjustments made on
the records of the Trustee as hereinafter provided.
Each Global Security shall represent such of the outstanding Securities
as shall be specified therein and each shall provide that it shall represent the
aggregate principal amount of outstanding Securities from time to time endorsed
thereon and that the aggregate principal amount of outstanding Securities
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and transfers of interests
therein in accordance with the terms of this Indenture. Any change in the
aggregate principal amount of a Global Security to reflect the amount of any
increase or decrease in the principal amount of outstanding Securities
represented thereby shall be made by the Trustee in accordance with reasonable
instructions given by the Holder thereof as required by Section 2.6 hereof and
shall be conclusively reflected on the books and records of the Trustee.
Upon the issuance of the Global Security to DTC, DTC shall credit, on
its internal book-entry registration and transfer system, its Participant's
accounts with the respective interests owned by such Participants. Interests in
the Global
-25-
Securities shall be limited to Participants, including Euroclear and Cedel, and
indirect Participants.
The Participants shall not have any rights either under this Indenture
or under any Global Security with respect to such Global Security held on their
behalf by DTC, and DTC may be treated by the Company, the Trustee and any agent
of the Company or the Trustee as the absolute owner of such Global Security for
the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, interest and Additional Interest,
if any, on the Global Securities and for all other purposes. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by DTC or impair, as between DTC and its
Participants, the operation of customary practices of DTC governing the exercise
of the rights of an owner of a beneficial interest in any Global Security.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel, as in effect from
time to time, shall be applicable to interests in the Regulation S Global
Security that are held by the Participants through Euroclear or Cedel.
(b) Physical Securities. All Securities will initially be issued in the
form of Global Securities pursuant to Section 2.1(a). If Physical Securities are
issued in accordance with Section 2.6(a), the Physical Securities shall be
issued initially substantially in the form of Exhibit A hereto, in certificated
form and issued in the names of the then beneficial holders thereof (or their
nominees), duly executed by the Company and authenticated by the Trustee as
hereinafter provided.
(c) Securities. The provisions of the form of Securities contained in
Exhibit A hereto are incorporated herein by reference. The Securities and the
Trustee's Certificates of Authentication shall be substantially in the form of
Exhibit A hereto. The Securities may have notations, legends or endorsements
required by law, stock exchange rule or usage and provided to the Trustee in
writing by the Company. The Company shall approve the form of the Securities and
any notation, legend or endorsement on them. If required, the Securities may
bear the appropriate legend regarding original issue discount for federal income
tax purposes. Each Security shall be dated the date of its authentication. The
terms and provisions contained in the Securities shall constitute, and are
hereby expressly made, a part of this Indenture.
-26-
SECTION 2.2 Execution and Authentication.
Two Officers of the Company shall sign the Securities for the Company
by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate (i) Initial Securities for issue on the
Issue Date in the aggregate principal amount of $325,000,000, (ii) Private
Exchange Securities from time to time only in exchange for a like principal
amount of Initial Securities and (iii) Unrestricted Securities from time to time
only in exchange for a like principal amount of Initial Securities, in each case
upon a written order signed by an Officer of the Company. The order shall be
based upon a Board Resolution of the Company and shall specify the amount of
Securities to be authenticated and the date on which the original issue of
Securities is to be authenticated. The order shall also provide instructions
concerning registration, legends, if any, pursuant to Section 2.6(f), amounts
for each Holder and delivery. The aggregate principal amount of Securities
outstanding at any time may not exceed $325,000,000 except as provided in
Section 2.7. The Securities shall be issued only in registered form, without
coupons and only in denominations of $1,000 and any integral multiple thereof.
SECTION 2.3 Registrar and Paying Agent.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Securities may be presented for payment ("Paying Agent").
The Company may have one or more additional paying agents. The term "Paying
Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent and shall, if required,
incorporate the provisions of the TIA. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with the provisions of Section 7.7.
-27-
The Company initially appoints the Trustee as Registrar and Paying
Agent. The Company shall give written notice to the Trustee in the event that
the Company decides to act as Registrar.
SECTION 2.4 Paying Agent To Hold Money in Trust.
The Company shall require each Paying Agent to agree in writing to hold
in trust for the benefit of Securityholders or the Trustee all money held by the
Paying Agent for the payment of principal of or interest on the Securities
(whether such money has been paid to it by the Company or any other obligor on
the Securities), and the Company and the Paying Agent shall each notify the
Trustee of any default by the Company (or any other obligor on the Securities)
in making any such payment. The Company at any time may require a Paying Agent
to pay all money held by it to the Trustee and account for any funds disbursed
and the Trustee may at any time during the continuance of any payment default,
upon written request to a Paying Agent, require such Paying Agent to pay all
money held by it to the Trustee and to account for any funds disbursed. Upon
making such payment the Paying Agent shall have no further liability for the
money delivered to the Trustee.
SECTION 2.5 Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee at least five Business Days before each Interest Payment Date and
at such other times as the Trustee may request in writing a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Securityholders.
SECTION 2.6 Transfer and Exchange.
(a) Transfer and Exchange of Global Securities. Transfer of the Global
Securities shall be by delivery. Global Securities may not be transferred as or
exchanged for Physical Securities except (i) if DTC notifies the Company that it
is unwilling or unable to continue to act as depositary with respect to the
Global Securities or ceases to be a clearing agency registered under the
Exchange Act and, in either case, a successor depositary registered as a
clearing agency under the Exchange Act is not appointed by the Company within
120 days, (ii) at any time if the Company in its sole discretion determines that
the Global Securities (in whole but not in part) should be exchanged for
Physical Securities or (iii) if the owner of an interest in the Global
Securities requests such
-28-
Physical Securities, following an Event of Default under this Indenture, in a
writing delivered through DTC to the Trustee.
Upon the occurrence of any of the events specified in the previous
paragraph, Physical Securities shall be issued in such names as DTC shall
instruct the Trustee and the Trustee shall cause the aggregate principal amount
of the applicable Global Security to be reduced accordingly and direct DTC to
make a corresponding reduction in its book-entry system. The Company shall
execute and the Trustee shall authenticate and cause to be delivered to the
Person designated in such instructions a Physical Security in the appropriate
principal amount. The Trustee shall deliver such Physical Securities to the
Persons in whose names such Securities are so registered. Physical Securities
issued in exchange for an Initial Global Security pursuant to this Section
2.6(a) shall bear the Securities Act Legend and shall be subject to all
restrictions on transfer contained therein. Global Securities may also be
exchanged or replaced, in whole or in part, as provided in Sections 2.7 and 2.8.
Every Security authenticated and delivered in exchange for, or in lieu of, a
Global Security or any portion thereof, pursuant to Section 2.7 or 2.8, shall be
authenticated and delivered in the form of, and shall be, a Global Security. A
Global Security may not be exchanged for another Security other than as provided
in this Section 2.6(a).
(b) Transfer and Exchange of Interests in Global Securities. The
transfer and exchange of interests in Global Securities shall be effected
through DTC, in accordance with this Indenture and the procedures of DTC
therefor. Interests in Initial Global Securities shall be subject to
restrictions on transfer comparable to those set forth herein to the extent
required by the Securities Act. The Trustee shall have no obligation to
ascertain DTC's compliance with any such restrictions on transfer. Transfers of
interests in Global Securities shall also require compliance with subparagraph
(i) below, as well as one or more of the other following subparagraphs as
applicable:
(i) All Transfers and Exchanges of Interests in Global Securities. In
connection with all transfers and exchanges of interests in Global
Securities (other than transfers of interests in a Global Security to
Persons who take delivery thereof in the form of an interest in the same
Global Security), the transferor of such interest must deliver to the
Registrar (1) instructions given in accordance with the Applicable
Procedures from a Participant or an indirect Participant directing DTC to
credit or cause to be credited an interest in the specified Global Security
in an amount equal to the interest to be transferred or exchanged, (2) a
written order given in accordance with the Applicable Procedures
-29-
containing information regarding the Participant account to be credited with
such increase and (3) instructions given by the Holder of the Global Security to
effect the transfer referred to in (1) and (2) above.
(ii) Transfer of Interests in the Same Initial Global Security.
Interests in any Initial Global Security may be transferred to Persons who
take delivery thereof in the form of an interest in the same Initial Global
Security in accordance with the transfer restrictions set forth in Section
2.6(f) hereof.
(iii) Transfer of Interests to Another Initial Global Security.
Interests in any Initial Global Security may be transferred to Persons who
take delivery thereof in the form of an interest in another Initial Global
Security if the Registrar receives the following:
(A) if the transferee will take delivery in the form of an
interest in the 144A Global Security, then the transferor must deliver
a certificate in the form of Exhibit B hereto, including the
certifications in item 1 thereof; or
(B) if the transferee will take delivery in the form of an
interest in the Regulation S Global Security, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item 2 thereof.
(iv) Transfer and Exchange of Interests in Initial Global Security for
Interests in an Unrestricted Global Security. Interests in any Initial
Global Security may be exchanged by the holder thereof for an interest in
the Unrestricted Global Security or transferred to a Person who takes
delivery thereof in the form of an interest in the Unrestricted Global
Security if:
(A) such exchange or transfer is effected pursuant to the Exchange
Registration Statement in accordance with the Registration Rights
Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(C) the Registrar receives the following:
(1) if the holder of such an interest in an Initial Global
Security proposes to exchange it for an interest in the
Unrestricted Global Security, a certificate from such Holder
-30-
in the form of Exhibit C hereto, including the certifications in
item 1(a) thereof;
(2) if the holder of such an interest in an Initial Global
Security proposes to transfer it to a Person who shall take
delivery thereof in the form of an interest in an Unrestricted
Global Security, a certificate in the form of Exhibit B hereto,
including the certification in item 4 thereof; and
(3) in each such case set forth in this paragraph (C), an
Opinion of Counsel in form reasonably acceptable to the Company
and the Trustee, to the effect that such exchange or transfer is
in compliance with the Securities Act and, that the restrictions
on transfer contained herein and in Section 2.6(f) hereof are not
required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a time when
an Unrestricted Global Security has not yet been issued, the Company shall issue
and, upon receipt of an authentication order in accordance with Section 2.2, the
Trustee shall authenticate one or more Unrestricted Global Securities in an
aggregate principal amount equal to the principal amount of interests in the
Initial Global Security transferred pursuant to paragraph (B) above, provided
the Company has made appropriate arrangements with DTC prior to delivery of such
an authentication order to the Trustee.
(v) Notation by the Trustee of Transfer of Interests Among Global
Securities. Upon satisfaction of the requirements for transfer of interests
in Global Securities pursuant to clauses (iii) or (iv) above, the Trustee
shall reduce or cause to be reduced the aggregate principal amount of the
relevant Global Security from which the interests are being transferred, and
increase or cause to be increased the aggregate principal amount of the
Global Security to which the interests are being transferred, in each case,
by the principal amount so transferred and shall direct DTC to make
corresponding adjustments in its book-entry system. No transfer of interests
of a Global Security shall be effected until, and any transferee pursuant
thereto shall succeed to the rights of a holder of such interests only when,
the Registrar has made appropriate adjustments to the applicable Global
Security in accordance with this paragraph.
-31-
(c) Transfer or Exchange of Physical Securities for Interests in a
Global Security.
(i) If any Holder of Physical Securities required to contain the
Securities Act Legend proposes to exchange such Securities for an interest
in a Global Security, then, upon receipt by the Registrar of a certificate
from such Holder in the form of Exhibit C hereto, including the
certifications in item 2 thereof which may be submitted by facsimile;
the Trustee shall cancel the Physical Securities, increase or cause to be
increased the aggregate principal amount of, the 144A Global Security or
the Regulation S Global Security, as the case may be, and direct DTC to
make a corresponding increase in its book-entry system.
(ii) A Holder of Physical Securities required to contain the Securities
Act Legend may exchange such Securities for an interest in the Unrestricted
Global Security only:
(A) if such exchange or transfer is effected pursuant to the
Exchange Registration Statement in accordance with the Registration
Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) upon receipt by the Registrar of the following documentation
(all of which may be submitted by facsimile):
(1) if the Holder of such Physical Securities proposes to
exchange such Securities for an interest in the Unrestricted
Global Security, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item 1(b)
thereof;
(2) an Opinion of Counsel in form reasonably acceptable to
the Company, to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in Section 2.6(f) hereof are not
required in order to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a time when
an Unrestricted Global Security has not yet been issued, the Company shall issue
and, upon
-32-
receipt of an authentication order in accordance with Section 2.2, the Trustee
shall authenticate (i) one or more Unrestricted Global Securities in an
aggregate principal amount equal to the principal amount of Physical Securities
transferred pursuant to paragraph (B) above.
-33-
(d) Transfer and Exchange of Physical Securities.
(i) Transfer of a Physical Security to Another Physical Security.
Following the occurrence of one or more of the events specified in Section
2.6(a), a Physical Security may be transferred to Persons who take delivery
thereof in the form of another Physical Security if the Registrar receives
the following:
(A) if the transfer is being effected pursuant to and in
accordance with Rule 144A, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item 3(a) thereof; or
(B) if the transfer is being effected pursuant to and in
accordance with Regulation S, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item 3(b) thereof.
(ii) Transfer and Exchange of Restricted Physical Security for Physical
Security Which Does Not Bear the Securities Act Legend. Following the
occurrence of one or more of the events specified in Section 2.6(a) and the
receipt by the Trustee of an OfficersAE Certificate stating that such events
have occurred, a Restricted Physical Security may be exchanged by the Holder
thereof for a Physical Security or transferred to a Person who takes
delivery thereof in the form of a Physical Security which does not bear the
Securities Act Legend if:
(A) such exchange or transfer is effected pursuant to the Exchange
Registration Statement in accordance with the Registration Rights
Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement; or
(C) the Registrar receives a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item 1(c)
thereof and an Opinion of Counsel in form reasonably acceptable to the
Company, to the effect that such exchange or transfer is in compliance
with the Securities Act and, that the restrictions on transfer
contained herein and in Section 2.6(f) hereof are not required in order
to maintain compliance with the Securities Act.
(iii) Exchange of Physical Securities. Whey Physical
-34-
Securities are presented by a Holder to the Registrar with a request to
register the exchange of such Physical Securities for an equal principal
amount of Physical Securities of other authorized denominations, the
Registrar shall make the exchange as requested only if the Physical
Securities are endorsed or accompanied by a written instrument of transfer
in form satisfactory to the Registrar duly executed by such Holder or by
his attorney duly authorized in writing and shall be issued only in the
name of such Holder or its nominee. The Physical Securities issued in
exchange for Physical Securities shall bear the Securities Act Legend and
shall be subject to all restrictions on transfer contained herein in each
case to the same extent as the Physical Securities so exchanged.
(iv) Return of Physical Securities. In the event of a transfer pursuant
to clauses (i) or (ii) above and the Holder thereof has delivered
certificates representing an aggregate principal amount of Securities in
excess of that to be transferred, the Company shall execute and the Trustee
shall authenticate and make available for delivery to the Holder of such
Security without service charge, a new Physical Security or Securities of
any authorized denomination requested by the Holder, in an aggregate
principal amount equal to the portion of the Security not so transferred.
(e) Exchange Offer. Upon the occurrence of the Exchange Offer (as
defined in the Registration Rights Agreement) in accordance with the
Registration Rights Agreement, the Company shall issue and, upon receipt of an
Officers' Certificate stating that the Exchange Registration Statement has
become effective and that the Exchange Offer has occurred and an authentication
order in accordance with Section 2.2, the Trustee shall authenticate one or more
Unrestricted Global Securities in an aggregate principal amount equal to the
principal amount of the interests in the Initial Global Securities. Concurrently
with the issuance of such Securities, the Trustee shall cause the aggregate
principal amount of the applicable Initial Global Securities to be reduced
accordingly and direct DTC to make a corresponding reduction in its book-entry
system.
In the case that one or more of the events specified in Section 2.6(a)
have occurred, upon the occurrence of such Exchange Offer, the Company shall
issue and, upon receipt of an authentication order in accordance with Section
2.2, the Trustee shall authenticate Unrestricted Physical Securities in an
aggregate principal amount equal to the principal amount of the Restricted
Physical Securities tendered for acceptance by persons participating therein.
-35-
(f) Legends.
Each Initial Global Security and, if applicable, each Restricted
Physical Security shall bear the legend (the "Securities Act Legend") in
substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY
ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT), OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT WITHIN TWO
YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (A) TO AES OR ANY SUBSIDIARY THEREOF, (B)
INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 144A UNDER THE SECURITIES ACT, (C) OUTSIDE THE UNITED STATES IN
AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES
ACT, (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER
OF THIS SECURITY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE
SECURITY, THE HOLDER MUST SUBMIT A CERTIFICATE WITH RESPECT TO SUCH
TRANSFER TO THE TRUSTEE (A FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE);
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO
REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING RESTRICTIONS.
(g) Global Security Legend. Each Global Security shall bear a legend in
substantially the following form:
"UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC") TO A NOMINEE OF
DTC, OR BY ANY SUCH NOMINEE
-36-
OF DTC, OR BY DTC TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC).
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY
SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN SECTION 2..6 OF THE INDENTURE."
(h) Cancellation and/or Adjustment of Global Securities. At such time
as all interests in the Global Securities have been exchanged for Physical
Securities, all Global Securities shall be returned to or retained and
canceledcancelled by the Trustee in accordance with Section 2.9 hereof. At any
time prior to such cancellation, if any interest in a Global Security is
exchanged for an interest in another Global Security or for Physical Securities,
the principal amount of Securities represented by such Global Security shall be
reduced accordingly and all such changes to such Global Security shall be
reflected on the books and records of the Trustee, by the Trustee to reflect
such reduction.
(i) General Provisions Relating to All Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Securities and,
following the occurrence of one or more of the events specified in Section
2.6(a), Physical Securities upon a written order signed by an Officer of the
Company or at the Registrar's request.
(ii) No service charge shall be made to a Holder for any registration
of transfer or exchange, but the Company may require payment of a sum
sufficient to cover any stamp or transfer tax or similar governmental charge
payable in
-37-
connection therewith (other than any such stamp or transfer taxes or
similar governmental charge payable upon exchange or transfer pursuant to
Sections 2.8, 3.8, 4.11 and 4.15 hereof).
(iii) All Global Securities and Physical Securities issued upon any
registration of transfer or exchange of Global Securities or Physical
Securities shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Global Securities or Physical Securities surrendered upon such registration
of transfer or exchange.
(iv) The Company shall not be required (A) to issue, to register the
transfer of or to exchange Securities during a period beginning at the
opening of business 15 days before the day of the mailing of the notice of
redemption of Securities and ending at the close of business such mailing,
(B) to register the transfer of or to exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part or (C) to register the transfer of or to
exchange a Security between a record date and the next succeeding Interest
Payment Date.
(v) Prior to due presentment for the registration of a transfer of any
Security, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Security is registered as the absolute owner of
such Security for the purpose of receiving payment of principal of and
interest on such Securities and for all other purposes, and none of the
Trustee, any Agent or the Company shall be affected by notice to the
contrary.
(vi) The Trustee shall have no obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under
this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among
Participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by the terms of, this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
SECTION 2.7 Replacement Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall
-38-
authenticate and deliver in exchange therefor a new Security of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be reasonably required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount, having endorsed
thereon and bearing a number not contemporaneously outstanding.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.8 Temporary Securities.
Pending the preparation of definitive Securities, the Company may
execute and, upon Company Order, the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued, and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable
-39-
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
10.2, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and make available for delivery in exchange therefor a like
principal amount of definitive Securities of authorized denominations and like
tenor. Until so exchanged the temporary Securities shall in all respects be
entitled to the same benefits under this Indenture as definitive Securities.
SECTION 2.9 Cancellation.
All Securities surrendered for payment, redemption or registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceledcancelled by it. The
Company may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceledcancelled by the Trustee. No Securities shall be authenticated
in lieu of or in exchange for any Securities canceledcancelled as provided in
this Section, except as expressly permitted by this Indenture. All
canceledcancelled Securities held by the Trustee shall be returned to the
Company.
SECTION 2.10 Defaulted Interest.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Security and the
date of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
-40-
arrangements satisfactory to the Trustee for such deposit prior to the date
of the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Company shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days
prior to the date of the proposed payment. The Company shall promptly
notify the Trustee of such Special Record Date and, in the name and at the
expense of the Company, the Trustee shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor to
be mailed, first-class postage prepaid, to each Holder at his address as it
appears in the Security Register, not less than five Business Days prior to
such Special Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid not later than the fifteenth day after
such Special Record Date to the Persons in whose names the Securities (or
their respective Predecessor Securities) are registered at the close of
business on such Special Record Date.
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this clause, such manner of
payments shall be deemed practicable by the Trustee.
SECTION 2.11 CUSIP or CINS Number.
The Company in issuing the Securities may use a "CUSIP" or "CINS"
number, and if so, such CUSIP or CINS number shall be included in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP or CINS number printed in the notice or on the Securities,
and that reliance may be placed only on the other identification numbers printed
on the Securities. The Company will promptly notify the Trustee of any change in
the CUSIP or CINS number.
SECTION 2.12 Payments of Interest.
(a) The Holder of a Physical Security at the close of business on the
Regular Record Date with respect to any Interest Payment Date shall be entitled
to receive the interest and Additional Interest, if any, payable on
-41-
such Interest Payment Date notwithstanding any transfer or exchange of such
Physical Security subsequent to the regular record date and prior to such
Interest Payment Date, except if and to the extent the Company shall default in
the payment of the interest or Additional Interest due on such Interest Payment
Date, in which case such Defaulted Interest and Additional Interest, if any,
shall be paid in accordance with Section 2.10; provided that, in the event of an
exchange of a Physical Security for a beneficial interest in any Global Security
subsequent to a Regular Record Date or any Special Record Date and prior to or
on the related Interest Payment Date or other payment date under Section 2.10,
any payment of the interest and Additional Interest payable on such payment date
with respect to any such Physical Security shall be made to the Person in whose
name such Physical Security was registered on such record date. Payments of
interest on the Global Securities will be made to the Holder of the Global
Security on each Interest Payment Date; provided that, in the event of an
exchange of all or a portion of a Global Security for Physical Security
subsequent to the Regular Record Date or any Special Record Date and prior to or
on the related Interest Payment Date or other payment date under Section 2.10
any payment of interest or Additional Interest payable on such Interest Payment
Date or other payment date with respect to the Physical Security shall be made
to the Holder of the Global Security.
(b) The Trustee shall pay interest and Additional Interest, if any, to
DTC, with respect to any Global Security held by DTC, on the applicable Interest
Payment Date in accordance with instructions received from the Company at least
five Business Days before the applicable Interest Payment Date. The Company
shall deliver such instructions in the form of an Officers' Certificate setting
forth Additional Interest in the aggregate and per $1,000 principal amount of
Securities to be paid on such Interest Payment Date.
SECTION 2.13 Outstanding Securities.
Securities outstanding at any time are all Securities that have been
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Company or one of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee
-42-
receives proof satisfactory to it that the replaced Security is held by a bona
fide purchaser.
If the Paying Agent holds on a redemption date or Maturity Date money
sufficient to pay the principal of, and interest on Securities payable on that
date, then on and after that date such Securities cease to be outstanding and
interest on them ceases to accrue.
SECTION 2.14 Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, any Subsidiary or any of their respective Affiliates shall be
disregarded, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded.
The Trustee may require an Officers' Certificate listing securities
owned by the Company, any Subsidiary or any of their respective Affiliates.
ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.1 Right of Redemption.
The Securities may be redeemed at the election of the Company as
provided by the terms of the Securities, as a whole or from time to time in
part, at the times and at the Redemption Prices specified in the form of
Security set forth in Exhibit A together with any applicable accrued interest to
the Redemption Date.
SECTION 3.2 Applicability of Article.
Redemption of Securities at the election of the Company, as permitted
by the Securities or any provision of this Indenture, shall be made in
accordance with such provision and this Article.
SECTION 3.3 Election To Redeem; Notice to Trustee.
-43-
The election of the Company to redeem any Securities pursuant to
Section 3.1 shall be evidenced by a Board Resolution of the Company delivered to
the Trustee. The Company shall, at least 30 days prior to the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee) notify the Trustee of such Redemption Date and of the principal amount
of Securities to be redeemed.
SECTION 3.4 Selection by Trustee of
Securities To Be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected by the Trustee, from all outstanding
Securities not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of portions (equal to $1,000 or any integral multiple thereof) of the
principal amount of Securities of a denomination larger than $1,000.
The Trustee shall promptly notify the Company and the Registrar in
writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.
For all purposes of this Indenture, all provisions relating to the
redemption of Securities shall relate, in the case of any Securities redeemed or
to be redeemed only in part, to the portion of the principal amount of such
Securities which has been or is to be redeemed.
SECTION 3.5 Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the outstanding Securities are to be redeemed, the
identification including CUSIP
-44-
numbers, (and, in the case of partial redemption, the principal amounts) of the
particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and that, unless the Company
shall default in the payment of the Redemption Price and any applicable accrued
interest, interest thereon will cease to accrue on and after said date, and
(5) the place or places where such Securities are to be surrendered for
payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 3.6 Deposit of Redemption Price.
On or prior to 10:00 a.m. New York City time on any Redemption Date,
the Company shall deposit with the Trustee or with a Paying Agent an amount of
money sufficient to pay the Redemption Price of and accrued interest on all the
Securities which are to be redeemed on that date.
SECTION 3.7 Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and any applicable
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Paying Agent at the Redemption Price, together
with any applicable accrued interest to the Redemption Date.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) and
accrued interest on such unpaid principal shall, until paid, bear interest from
the Redemption Date at the rate provided by the Security.
-45-
SECTION 3.8 Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE IV
COVENANTS
SECTION 4.1 Payment of Securities.
The Company shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities and this Indenture.
An installment of principal or interest shall be considered paid on the
date due if the Trustee or Paying Agent (other than the Company or any
Subsidiary of the Company or any Affiliate of any thereof) holds on such date by
10:00 a.m., New York City time, immediately available funds designated for and
sufficient to pay such installment.
The Company shall pay interest on overdue principal and on overdue
installments of interest, in each case at the rate per annum specified in the
Securities, to the extent lawful.
SECTION 4.2 Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency, where Securities may be surrendered for registration
of transfer or exchange or for presentation for payment and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices
-46-
and demands may be made or served at the address of the Trustee set forth in
Section 10.2.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations,
provided that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes. The Company will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Company hereby initially designates the offices of the Trustee as
set forth in Section 10.2 as an agency of the Company in accordance with Section
2.3.
SECTION 4.3 Corporate Existence.
Subject to Article V hereof, the Company shall do or cause to be done,
at its own cost and expense, all things necessary to preserve and keep in full
force and effect the corporate existence and rights (charter and statutory),
licenses and/or franchises of the Company, provided that the Company shall not
be required to preserve any such right, license or franchise, if in the
reasonable and good faith judgment of the Board of Directors of the Company (i)
such preservation or existence is not desirable in the conduct of business of
the Company and (ii) the loss of such right, license or franchise is not adverse
in any material respect to the Holders or to the Company or the ability of the
Company to satisfy its obligations hereunder.
SECTION 4.4 Limitation on Business.
The Company (a) shall continue, and shall cause each Material AES
Entity to continue, to engage in business of the same general type as now
conducted by the Company and its Restricted Subsidiaries and (b) shall continue,
and shall cause each Material AES Entity to continue, to operate its and their
respective businesses on a basis substantially consistent with the policies and
standards of the Company or such Material AES Entity as in effect on the Closing
Date.
SECTION 4.5 Limitation on Restricted Subsidiary
Investments and Mergers.
The Company shall not permit any Restricted Subsidiary with any direct
or indirect interest in a Power
-47-
Supply Business to make any Investment in, or to consolidate or merge with, any
other Person with a direct or indirect interest in any other Power Supply
Business or any Unrelated Business. In addition, the Company will not permit any
Restricted Subsidiary with any direct or indirect interest in any Unrelated
Business to make any Investment in, or to consolidate or merge with, any other
Person with a direct or indirect interest in any Power Supply Business or any
other Unrelated Business. The Company's obligation to comply with this covenant
shall terminate if and when the Securities become Investment Grade.
The foregoing restrictions shall not apply to any Intermediate Holding
Company; provided that (i) each such Intermediate Holding Company's direct and
indirect interest in any Power Supply Business or Unrelated Business shall be
limited to the ownership of Capital Stock or Debt obligations of a Person with a
direct or indirect interest in such Power Supply Business or Unrelated Business;
(ii) no Intermediate Holding Company shall incur, assume, create or suffer to
exist any Debt (including any Guarantee of Debt) other than Debt to the Company
or Debt permitted under clauses (iii), (viii) and (xi) of Section 4.9(b); and
(iii) no Lien shall exist upon any assets of such Intermediate Holding Company
whether now or hereafter acquired, except for Liens upon the Capital Stock of a
Restricted Subsidiary of an Intermediate Holding Company securing Debt of such
Restricted Subsidiary and Liens securing Debt permitted under clauses (iii) and
(xi) of Section 4.9(b).
SECTION 4.6 Compliance Certificates.
The Company shall furnish to the Trustee annually, on or before a date
not more than four months after the end of its fiscal year (which, on the date
hereof, is a calendar year), a brief certificate (which need not contain the
statements required by Section 10.4) from its principal executive, financial or
accounting officer as to his or her knowledge of the compliance of the Company
with all conditions and covenants under this Indenture (such compliance to be
determined without regard to any period of grace or requirement of notice
provided under this Indenture) which certificate shall comply with the
requirements of the TIA.
SECTION 4.7 Reports.
So long as any Security is outstanding, the Company shall file with the
SEC the annual reports, quarterly reports and the information, documents and
other reports required to be filed by the Company with the SEC pursuant to
Sections 13 and 15(d) of the Exchange Act, whether or not the Company has or is
required to have a class of securities registered under the Exchange Act, at the
time it is or would be required to file
-48-
the same with the SEC and within 15 days after it is or would be required to
file such reports, information or documents with the SEC shall mail such
reports, information and documents to the Holders at their addresses set forth
in the Register of Securities maintained by the Registrar and the Trustee. The
Company also shall comply with the other provisions of TIA (0) 314(a). Delivery
of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).
SECTION 4.8 Limitation on Debt.
(a) The Company shall not Incur any Debt, including Acquisition Debt,
unless after giving effect to the Incurrence of such Debt and the receipt and
application of the proceeds therefrom, the Fixed Charge Ratio of the Company
would be greater than 2 to 1. The Company's obligation to comply with this
covenant will terminate if and when the Notes become Investment Grade.
(b) Notwithstanding the foregoing, the Company may Incur each and all
of the following:
(i) Debt under or in respect of the Bank Credit Agreement in an
aggregate principal amount at any one time outstanding not to exceed $600
million;
(ii) Debt issued in exchange for, or the proceeds of which are used to
refinance, outstanding Securities or other Debt of the Company in an amount
(or, if such new Debt provides for an amount less than the principal amount
thereof to be due and payable upon a declaration of acceleration thereof,
with an original issue price) not to exceed the amount so exchanged or
refinanced (plus accrued interest, premium, if any, and fees and expenses
related to such exchange or refinancing); provided that (A) the date of any
scheduled payment of principal by way of sinking fund, mandatory redemption
or otherwise (including defeasance) on any Debt so refinanced or exchanged
otherwise due after the final scheduled Maturity Date of the Securities
shall not occur prior to such Maturity Date as a result of such exchange or
refinancing and (B) new Debt the proceeds of which are used to exchange or
refinance the Securities or other Debt of the Company that is subordinated
in right of payment to the Securities shall only be permitted under this
clause (ii) if (x) in case the Securities are exchanged or refinanced in
part,
-49-
such new Debt, by its terms or by the terms of any agreement or instrument
pursuant to which such Debt is issued, is expressly made pari passu with,
or subordinate in right of payment to, the remaining Securities, (y) in
case the Debt to be exchanged or refinanced is subordinated in right of
payment to the Securities, such new Debt, by its terms or by the terms of
any agreement or instrument pursuant to which such Debt is issued, is
expressly made subordinate in right of payment to the Securities, at least
to the extent that the Debt to be exchanged or refinanced is subordinated
in right of payment to the Securities and (z) in case the Securities are
exchanged or refinanced in part or the Debt to be exchanged or refinanced
is subordinated in right of payment to the Securities, as of the date the
new Debt is Incurred, the Average Life of the new Debt shall be equal to or
greater than the Average Life of the Securities or Debt to be exchanged or
refinanced;
(iii) Debt of the Company to any of its Consolidated Subsidiaries,
except that any transfer of such Debt by a Consolidated Subsidiary (other
than to another Consolidated Subsidiary) will be deemed to be an Incurrence
of Debt; provided that such Debt is expressly subordinated in right of
payment to the Securities; and
(iv) Debt in an aggregate principal amount not to exceed $50 million at
any one time outstanding.
(c) For purposes of determining any particular amount of Debt under
this Section 4.8, Guarantees of, or obligations with respect to letters of
credit supporting, Debt otherwise included in the determination of such
particular amount shall not be included. For purposes of determining compliance
with this Section 4.8, (A) in the event that an item of Debt meets the criteria
of more than one of the types of Debt described in the above clauses, the
Company, in its sole discretion, shall classify such item of Debt and only be
required to include the amount and type of such Debt in one of such clauses and
(B) the amount of Debt issued at a price that is less than the principal amount
thereof shall be equal to the amount of the liability in respect thereof
determined in conformity with GAAP.
SECTION 4.9 Limitation on Restricted ____________________
Subsidiary Debt.
(a) The Company shall not permit any Restricted Subsidiary to Incur,
directly or indirectly, any Debt, including Acquisition Debt. The Company's
obligation to comply with this covenant will terminate if and when the
Securities become Investment Grade.
-50-
(b) Notwithstanding the foregoing, each and all of the following Debt
may be Incurred by a Restricted Subsidiary:
(i) Debt outstanding as of the Closing Date;
(ii) Debt Incurred for any purpose (including without limitation the
purposes set forth in clause (iii) below) to the extent of the amount
thereof that is also Debt of the Company and is permitted under Section 4.8;
(iii) Debt Incurred to finance the development, acquisition,
construction, maintenance, working capital requirements in the ordinary
course of business consistent with past practice or operation of a Power
Supply Business or Unrelated Business in which the Company or any Restricted
Subsidiary has a direct or indirect interest; provided that (a) such Debt
shall be permitted under this clause (iii) only to the extent of the amount
thereof which (x) is Non-Recourse to the Company and (y) is Non-Recourse to
any other Restricted Subsidiary of the Company other than Restricted
Subsidiaries which represented less than 33% of the Consolidated EBITDA of
the Company for the Reference Period, and (b) upon the commencement of
commercial operations of such Power Supply Business or, in the case of an
acquisition of such Power Supply Business or Unrelated Business, upon the
date of such acquisition, the Company directly or through its Restricted
Subsidiaries either (x) controls, under an operating and management
agreement or otherwise, the day to day management and operation of the Power
Supply Business or Unrelated Business so financed or (y) has significant
influence over the management and operation of such Power Supply Business or
Unrelated Business;
(iv) Debt issued in exchange for, or the proceeds of which are used to
refinance, outstanding Debt of such Restricted Subsidiary otherwise
permitted under the Indenture in an amount (or, if such new Debt provides
for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration thereof, with an original issue price)
not to exceed the amount so exchanged or refinanced (plus accrued interest,
premium, if any, and fees and expenses related to such exchange or
refinancing plus any principal amounts previously repaid); provided that (a)
the new Debt shall be Non-Recourse to the Company to the same extent as the
Debt to be exchanged or refinanced, (b) if such Restricted Subsidiary has a
direct or indirect interest in any Power Supply Business or Unrelated
Business, the new Debt shall be Non-Recourse to any other Restricted
Subsidiary of the Company other than Restricted Subsidiaries which
represented less than 33% of the Consolidated EBITDA of the Company for the
-51-
Reference Period, (c) the date of any scheduled payment of principal by way
of sinking fund, mandatory redemption or otherwise (including defeasance)
on any Debt so refinanced or exchanged otherwise due after the final
scheduled Maturity Date of the Securities shall not occur prior to such
Maturity Date as a result of such exchange or refinancing and (d) if the
new Debt refinances principal amounts previously repaid, (x) such new Debt
shall be permitted only if on the date such new Debt is Incurred, the
Company could incur at least $1 of Debt under Section 4.8(a) and (y) the
proceeds from such new Debt are not to be used to make any Restricted
Payments;
(v) Guarantees of Debt of the Company under the Bank Credit Agreement;
(vi) Debt Incurred to support the performance obligations of a
Restricted Subsidiary engaged in providing construction management or
operating services to a Power Supply Business; provided that (a) such Debt
shall be permitted under this clause (vi) only to the extent of the amount
thereof which is Non-Recourse to the Company and is Non-Recourse to any
other Restricted Subsidiary of the Company other than Restricted
Subsidiaries which represented less than 33% of the Consolidated EBITDA of
the Company for the Reference Period, and (b) upon the commencement of
commercial operation of such Power Supply Business or in the case of an
acquisition of such Power Supply Business, upon the date of such
acquisition, the Company directly or through its Restricted Subsidiaries
either (x) controls, under an operating and management agreement or
otherwise, the day to day management and operation of such Power Supply
Business or (y) has significant influence over the management and operation
of such Power Supply Business;
(vii) Debt in an aggregate amount for all Restricted Subsidiaries at
any one time outstanding of not more than $50 million Incurred to finance
the on-going operation, but not any expansion or improvement, of a Power
Supply Business or Unrelated Business in which such Restricted Subsidiary
has a direct or indirect interest; provided that such Debt shall be
permitted under this clause (vii) only to the extent it is Non-Recourse to
the Company and to any other Restricted Subsidiary of the Company other than
Restricted Subsidiaries which represented less than 33% of the Consolidated
EBITDA of the Company for the Reference Period;
(viii) Debt of any Restricted Subsidiary of the Company owed to (A) the
Company or (B) any Restricted Subsidiary of the Company;
-52-
(ix) Debt in respect of Currency Agreements or Interest Rate
Agreements;
(x) Debt that is Non-Recourse to the Company and Non-Recourse to any
other Restricted Subsidiary of the Company other than Restricted
Subsidiaries which represented less than 33% of the Consolidated EBITDA of
the Company for the Reference Period, only to the extent that the proceeds
of such Debt are received by the Company or an Intermediate Holding Company
as a result of such proceeds being used to pay dividends or make
distributions on the Capital Stock of such Restricted Subsidiary and any
other Restricted Subsidiary in the chain of ownership between the Company or
such Intermediate Holding Company and such Restricted Subsidiary;
(xi) Acquisition Debt and Debt incurred to finance the acquisition of a
Power Supply Business; provided that such Acquisition Debt and other Debt is
Non-Recourse to the Company or any Person that was a Restricted Subsidiary
of the Company immediately prior to such Incurrence; and provided further
that where any Debt is incurred to finance the acquisition of more than one
Power Supply Business, all such acquisitions shall have occurred within 180
days of each other; and
(xii) Debt of the type described in clause (iii) of the definition
thereof the Incurrence of which causes a corresponding reduction in any debt
service or other similar cash reserve required to be maintained in
connection with any Debt of such Restricted Subsidiary permitted by clause
(iii) above and (to the extent that the same constitutes a refinancing of
Debt permitted under such clause (iii)), clause (iv) above, in each case,
only to the extent that the proceeds from such reserve reduction are
received by the Company or an Intermediate Holding Company as a result of
such proceeds being used to pay dividends or make distributions on the
Capital Stock of such Restricted Subsidiary and any other Restricted
Subsidiary in the chain of ownership between the Company or such
Intermediate Holding Company and such Restricted Subsidiary.
(c) For purposes of determining compliance with this Section 4.9, (A)
in the event that an item of Debt meets the criteria of more than one of the
types of Debt described in the above clauses, the Company, in its sole
discretion, shall classify such item of Debt and only be required to include the
amount and type of such Debt in one of such clauses and (B) the amount of Debt
issued at a price that is less than the principal amount thereof shall be equal
to the amount of the
-53-
liability in respect thereof determined in conformity with GAAP.
SECTION 4.10 Limitation on Additional Tiers of
Senior Subordinated Debt.
The Company shall not Incur or suffer to exist any Debt, other than
Debt evidenced by the Securities, that is subordinate in right of payment to any
Senior Debt unless such Debt, by its terms or the terms of the instrument
creating or evidencing it, is pari passu with, or subordinate in right of
payment to, the Securities; provided that any Debt of the Company or any of its
Restricted Subsidiaries which is outstanding on the Closing Date shall be
excluded from the operation of this covenant.
SECTION 4.11 Change of Control.
(a) Upon a Change of Control, each Holder of the Securities shall have,
subject to Article XI, the right to require that the Company repurchase such
Xxxxxx's Securities at a repurchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to the date of
repurchase in accordance with Section 4.11(b) hereof.
(b) Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder of the Securities at their last registered
addresses with a copy to the Trustee stating:
(1) that a Change of Control has occurred and that such Holder has the
right to require the Company to repurchase such Xxxxxx's Securities at a
repurchase price in cash equal to 101% of the principal amount thereof plus
accrued and unpaid interest, if any, to the date of repurchase (the "Change
of Control Offer");
(2) the circumstances and relevant facts regarding such Change of
Control (including information with respect to pro forma historical income,
cash flow and capitalization after giving effect to such Change of Control);
(3) the repurchase date (which shall be not earlier than 30 days or
later than 60 days from the date such notice is mailed) (the "Repurchase
Date");
(4) that any Security not tendered will continue to accrue interest;
-54-
(5) that any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Repurchase Date;
(6) that Holders electing to have a Security purchased pursuant to a
Change of Control Offer will be required to surrender the Security, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent at the address specified in the
notice prior to the close of business on the Repurchase Date;
(7) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day (or such shorter periods as may be required by applicable law)
preceding the Repurchase Date, a facsimile transmission or letter setting
forth the name of the Holder, the principal amount of Securities the Holder
delivered for purchase, and a statement that such Xxxxxx is withdrawing his
election to have such Securities purchased; and
(8) that Holders which elect to have their Securities purchased only in
part will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered.
(c) On the Repurchase Date, the Company shall:
(i) accept for payment Securities or portions thereof tendered
pursuant to the Change of Control Offer;
(ii) deposit by 10:00 a.m., New York City time, with the Trustee
money sufficient to pay the purchase price of all Securities or
portions thereof so tendered; and
(iii) deliver or cause to be delivered to the Trustee Securities
so accepted together with an Officers' Certificate identifying the
Securities or portions thereof tendered to the Company.
The Trustee shall promptly mail to the Holders of the Securities so
accepted payment in an amount equal to the purchase price, and promptly
authenticate and make available for delivery to such Holders a new Security in a
principal amount equal to any unpurchased portion of the Security surrendered.
The Company will publicly announce the results of the Change of Control Offer on
or as soon as practicable after the Repurchase Date.
-55-
The Company shall comply with all applicable tender offer rules,
including without limitation, Rule 14e-1 under the Exchange Act, in connection
with a Change of Control Offer.
SECTION 4.12 Limitation on Transactions
with Affiliates.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly enter into any transaction (including,
without limitation, the sale, purchase or lease of any assets or properties or
the rendering of any services) involving aggregate consideration in excess of $5
million with any Affiliate (other than a Person that constitutes an Affiliate
solely because of the Company's or a Subsidiary of the Company's control of such
Person except for any Unrestricted Subsidiary) or holder of 5% or more of any
class of Capital Stock of the Company except for transactions (including,
subject to Section 4.13, any loans or advances by or to, or Guarantee on behalf
of, any Affiliate or any such holder) made in good faith the terms of which are
fair and reasonable to the Company or such Restricted Subsidiary, as the case
may be, and are at least as favorable as the terms which could be obtained by
the Company or such Restricted Subsidiary, as the case may be, in a comparable
transaction made on an arm's-length basis with Persons who are not such a holder
or Affiliate; provided that any such transaction shall be conclusively deemed to
be on terms which are fair and reasonable to the Company or any of its
Restricted Subsidiaries and on terms which are at least as favorable as the
terms which could be obtained on an arm's-length basis with Persons who are not
such a holder or Affiliate if such transaction is approved by a majority of the
Company's directors (including a majority of the Company's independent
directors); and provided further, that with respect to the purchase or
disposition of assets of the Company or any of its Restricted Subsidiaries
having a net book value in excess of $15 million, in addition to approval of its
Board of Directors, the Company shall obtain a written opinion of an Independent
Financial Advisor stating that the terms of such transaction are fair to the
Company or its Restricted Subsidiary, as the case may be, from a financial point
of view; and provided further that the fairness, reasonableness and arm's-length
nature of the terms of any transaction which is part of a series of related
transactions may be determined on the basis of the terms of the series of
related transactions taken as a whole. This Section 4.12 shall not apply to (a)
transactions between the Company or any of its Restricted Subsidiaries and any
employee of the Company or any of its Restricted Subsidiaries that are approved
by the Board of Directors or any committee of the Board of Directors consisting
of the Company's independent directors, (b) the payment of reasonable and
customary regular fees to directors of the Company or a Restricted Subsidiary,
(c) any transaction
-56-
between the Company and any of its Consolidated Subsidiaries or between any of
its Consolidated Subsidiaries, (d) any Permitted Payment and any Restricted
Payment not otherwise prohibited by Section 4.13 or (e) the provision of general
corporate administrative, operating and management services, including, without
limitation, procurement, construction engineering, construction administration,
legal, accounting, financial, money management, risk management, personnel,
administration and business planning services, in each case, in the ordinary
course.
SECTION 4.13 Limitation on Restricted Payments.
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, make any Restricted Payment if after giving effect
to such Restricted Payment:
(a) an Event of Default or event that, after the giving of notice or
lapse of time or both would become an Event of Default, shall have occurred
and be continuing;
(b) the Company could not Incur at least $1 of Debt under Section
4.8(a); or
(c) the aggregate amount expended by the Company and its Restricted
Subsidiaries for all Restricted Payments (the amount of any single or
related series of Restricted Payments so expended or distributed, if in
excess of $15 million and other than in cash, to be determined in good faith
by the Board of Directors, as evidenced by a Board resolution) after April
1, 1997 shall exceed the sum of:
(1) 50% of the Net Income of the Company and its Consolidated
Subsidiaries for the period (taken as one accounting period) beginning
on April 1, 1997 and ending on the last day of the fiscal quarter for
which financial information is available immediately prior to the date
of such calculation; provided that if Net Income for such period is
less than zero, then minus 100% of such net loss; plus
(2) the aggregate net proceeds (including the fair market value of
proceeds other than cash, as determined in good faith by the Board of
Directors, as evidenced by a Board Resolution if the fair market value
of such non-cash proceeds is in excess of $15 million) received by (A)
the Company from and after April 1, 1997 from the issuance and sale
(other than to a Restricted Subsidiary) of its Capital Stock (excluding
Redeemable Stock, but including Capital Stock other than Redeemable
Stock issued upon
-57-
conversion of, or in exchange for, Redeemable Stock or securities
other than its Capital Stock), and warrants, options and rights to
purchase its Capital Stock (other than Redeemable Stock), but
excluding the net proceeds from the issuance, sale, exchange,
conversion or other disposition of its Capital Stock convertible
(unless solely at the option of the Company) into (x) any security
other than its Capital Stock or (y) its Redeemable Stock or (B) a
Finance Subsidiary of the Company from and after April 1, 1997 from
the issuance and sale (other than to the Company or a Restricted
Subsidiary) of its Qualified Capital Stock; plus
(3) to the extent not included in clause (1) above, the net
reduction in Investments of the type specified in clauses (iv) through
(vi) of the definition of Restricted Payment resulting from payments of
interest on Debt, dividends, repayments of loans or advances, or other
transfers of assets to the Company or other Person that made the
original Investment from the Person in which such Investment was made
or resulting from the sale or disposition of the Investment or other
return of the amount of the Investment or from the redesignation of any
Unrestricted Subsidiary as a Restricted Subsidiary; provided that such
payment, for purposes of the calculation to be made pursuant to this
clause (3), shall not exceed the amount of the original Investment;
plus
(4) any amount previously included as a Restricted Payment on
account of an obligation by the Company or any Restricted Subsidiary to
make a Restricted Payment which has not actually been made by the
Company or any Restricted Subsidiary and which is no longer required to
be paid by the Company or any Restricted Subsidiary; plus
(5) $502 million;
provided that the foregoing clause (c) shall not prevent the payment of any
dividend within 60 days after the date of its declaration if such dividend could
have been made on the date of its declaration without violation of the
provisions of this Section 4.13.
For purposes of clause (c)(2) above, the aggregate net proceeds
received by the Company (x) from the issuance of its Capital Stock upon the
conversion of, or exchange for, securities evidencing Debt of the Company, shall
be calculated on the assumption that the gross proceeds from such issuance
-58-
are equal to the aggregate principal amount (or, if discount Debt, the accreted
principal amount) of the Debt evidenced by such securities converted or
exchanged and (y) upon the conversion or exchange of other securities of the
Company shall be equal to the aggregate net proceeds of the original sale of the
securities so converted or exchanged if such proceeds of such original sale were
not previously included in any calculation for the purposes of clause (c)(2)
above plus any additional sums payable upon conversion or exchange.
The Company's obligation to comply with this covenant shall terminate
if and when the Securities become Investment Grade.
If an Investment which the Company or any Restricted Subsidiary is
obligated to make either in part from time to time or in whole in the future is
fixed in amount by the agreement setting forth such obligation, for purposes of
determining whether such Investment is a Restricted Payment permitted under this
Section 4.13 or is a Permitted Payment, the Investment shall be deemed to have
been made only once, in the amount so fixed, at the time the obligation first
arises (and not when payments in respect thereof are later made). If an
Investment which the Company or any Restricted Subsidiary is obligated to make
either in part from time to time or in whole in the future is not fixed in
amount by the agreement setting forth such obligation, for purposes of
determining whether such Investment is a Restricted Payment permitted under this
Section 4.13 or is a Permitted Payment, the Investment shall be deemed to have
been made at the time the obligation first arises in an amount to be determined
in good faith by the Board of Directors, as evidenced by a Board Resolution, and
any actual payments in respect of such Investment shall be deemed to be
Investments made on the date of payment thereof. Subject to the terms of clause
(v) of the definition of Permitted Payments, such later Investments may be
Permitted Payments.
SECTION 4.14 Limitation on Dividend and other
Payment Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any Restricted Subsidiary
to, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or restriction of any kind on the ability of any
Restricted Subsidiary to (i) pay dividends or make any other distributions
permitted by applicable law on any Capital Stock of such Restricted Subsidiary
owned by the Company or any other Restricted Subsidiary, (ii) make payments in
respect of any Debt owed to the Company or any other Restricted Subsidiary,
(iii) make loans or advances to the Company or any other Restricted Subsidiary
or (iv) transfer any of its Property to
-59-
the Company or any other Restricted Subsidiary. The Company's obligation to
comply with this covenant will terminate if and when the Securities become
Investment Grade.
This Section 4.14 shall not restrict or prohibit any encumbrances or
restrictions existing: (i) in connection with the Incurrence of any Debt
permitted under clauses (iii), (vi), (vii), (x) or (xi) of Section 4.9(b) or
with respect to any portion thereof that is also Debt of the Company and
permitted under Section 4.8; provided that such encumbrances or restrictions are
required in order to effect such financing and are not materially more
restrictive, taken as a whole, on the ability of the applicable Restricted
Subsidiary to make the payments, distributions, loans, advances or transfers
referred to in clauses (i) through (iv) of the preceding paragraph than
encumbrances and restrictions, taken as a whole, customarily accepted (or, in
the absence of any industry custom, reasonably acceptable) in substantially
non-recourse project financing, (ii) in connection with the execution and
delivery of an electric power or thermal energy purchase contract to which such
Restricted Subsidiary is the supplying party or other contracts with customers,
suppliers and contractors to which such Restricted Subsidiary is a party and
where such Restricted Subsidiary is engaged in the development, construction,
acquisition or operation of a Power Supply Business; provided that such
encumbrances or restrictions are required in order to effect such contracts and
are not materially more restrictive, taken as a whole, on the ability of the
applicable Restricted Subsidiary to make the payments, distributions, loans,
advances or transfers referred to in clauses (i) through (iv) in the preceding
paragraph than encumbrances and restrictions, taken as a whole, customarily
accepted (or, in the absence of any industry custom, reasonably acceptable) in
substantially non-recourse project financing, (iii) in connection with the
Incurrence of any Debt permitted under clause (iv) of Section 4.9(b), provided
that such encumbrances or restrictions taken as a whole are not materially more
restrictive on the ability of the applicable Restricted Subsidiary to make the
payments, distributions, loans, advances or transfers referred to in clauses (i)
through (iv) in the preceding paragraph than those that are then in effect,
taken as a whole, in connection with the Debt so exchanged or refinanced, (iv)
in connection with the Bank Credit Agreement and the project financing, electric
power and thermal energy purchase arrangements and other contracts with
customers, suppliers and contractors in effect on the Closing Date, including
extensions, refinancings, renewals or replacements thereof, (v) pursuant to
customary non-assignment provisions in leases, (vi) pursuant to restrictions
imposed pursuant to any stock purchase or asset purchase agreement pending the
consummation of the transactions contemplated thereby, (vii) in connection with
any Acquisition Debt, provided that such encumbrance or restriction was not
-60-
incurred in contemplation of the obligor becoming a Restricted Subsidiary of the
Company, which encumbrance or restriction is not applicable to any Person, or
the Property or assets of any Person, other than the Person, or the Property or
assets, acquired, (viii) customary restrictions on transfers of Property subject
to a Lien which could not materially adversely affect the Company's ability to
satisfy its obligations under the Indenture and the Securities or (ix)
provisions contained in agreements or instruments relating to Debt which
prohibit the transfer of all or substantially all of the assets of the obligor
thereunder unless the transferee shall assume the obligations of the obligor
under such agreement or instrument, in each case; provided that, in the case of
clause (iv) above, such encumbrances and restrictions, taken as a whole, in any
such extensions, refinancings, renewals or replacements are not materially more
restrictive on the ability of the applicable Restricted Subsidiary to make the
payments, distributions, loans, advances or transfers referred to in clauses (i)
through (iv) in the preceding paragraph than those encumbrances or restrictions
taken as a whole in effect immediately before such extension, refinancing,
renewal or replacement. This Section 4.14 shall not prevent the Company from
granting any Liens not expressly prohibited hereby.
SECTION 4.15 Limitation on Asset Dispositions.
(a) The Company shall not make, and shall not permit any of its
Restricted Subsidiaries to make, any Asset Disposition unless the Company (or
the Restricted Subsidiary, as the case may be) receives consideration at the
time of each such Asset Disposition at least equal to the fair market value of
the shares or assets sold or otherwise disposed of (such amounts in excess of
$50 million determined in good faith by the Board of Directors, as evidenced by
a Board Resolution) and either (i) not less than 75% of the consideration
received by the Company (or such Restricted Subsidiary, as the case may be) is
in the form of cash or property or assets used or useful in a Power Supply
Business or Capital Stock of a Person primarily engaged in a Power Supply
Business, provided that any note or other obligation received by the Company (or
such Restricted Subsidiary, as the case may be) that is converted into cash
within 180 days of such Asset Disposition and any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet) of the
Company or any Restricted Subsidiary that are assumed by the transferee of any
such assets shall be deemed to be cash for purposes of this clause (i), and (ii)
first, the Net Cash Proceeds of such Asset Disposition are applied within 90
days from the later of the date of such Asset Disposition or the receipt of Net
Cash Proceeds related thereto, to the payment of the principal of, premium and
interest on any Senior Debt of the Company (including to cash collateralize
letters of credit) and, in
-61-
connection with any such payment, any related loan commitment, standby facility
or the like shall be permanently reduced in an amount equal to the principal
amount so repaid and second, to the extent such Net Cash Proceeds are not
required by the lenders, or the terms, of the Senior Debt to be applied in
accordance with the foregoing or, if after being so applied there remain Net
Cash Proceeds, then at the Company's election, such Net Cash Proceeds are either
(x) invested in the business or businesses of the Company or any of its
Restricted Subsidiaries consistent with Section 4.4; provided that such
investment is made within 365 days from the later of the date of such Asset
Disposition or the receipt of the Net Cash Proceeds related thereto or (y)
applied to the payment of any Senior Debt of the Company or Debt of any
Restricted Subsidiary or any Consolidated Subsidiary (other than Debt owed to
the Company or another Restricted Subsidiary), and, in connection with any such
payment, any related loan commitment, standby facility or the like shall be
permanently reduced in an amount equal to the principal amount so repaid;
provided that such Net Cash Proceeds are so applied within three months after
the expiration of the 365-day period referred to in clause (x) above or (z)
applied to make a tender offer (the "Offer") to purchase Securities and other
Debt of the Company from time to time outstanding with similar provisions
requiring the Company to make an offer to purchase or to redeem such Debt with
the proceeds from assets sales, pro rata in proportion to the respective
principal amounts (or accreted values in the case of Debt issued with an
original issue discount) of the Securities and such other Debt then outstanding
at a purchase price of 100% of their principal amount (or accreted value in the
case of Debt issued with an original issue discount), plus accrued interest
(subject to proration in the event of oversubscription in the manner set forth
below). Notwithstanding the foregoing, to the extent that any or all of the Net
Cash Proceeds of any Foreign Asset Disposition are prohibited or delayed by
applicable local law from being repatriated to the U.S., the Company (or such
Restricted Subsidiary, as the case may be) shall not be required to apply the
portion of such Net Cash Proceeds so affected in accordance with clause (ii)
above (other than to repay Debt of the Restricted Subsidiary making such Asset
Disposition or Debt of a Consolidated Subsidiary of the Company, in each case as
contemplated by clause (ii) above and to the extent the prohibition or delay on
repatriation is not applicable to such repayment and such repayment is not in
violation of the terms of any Senior Debt) (the Company hereby agreeing to cause
the applicable Restricted Subsidiary to promptly take all actions required by
the applicable local law to permit such repatriation); provided that once such
repatriation of any such affected Net Cash Proceeds is permitted under the
applicable local law, such repatriation will be immediately effected and such
repatriated Net Cash Proceeds will be applied in the manner set forth in this
-62-
Section 4.15. To the extent that dividends or distributions of any or all of the
Net Cash Proceeds of any Foreign Asset Disposition would result in a tax
liability greater than that which would be incurred if such Net Cash Proceeds
were not so dividended or distributed, the Net Cash Proceeds so affected may be
retained by the applicable Restricted Subsidiary for so long as such adverse tax
liability would continue to be incurred.
Notwithstanding anything in this covenant to the contrary, the Company
and any Restricted Subsidiary may make the following Asset Dispositions:
(i) a disposition resulting from the bona fide exercise by governmental
authority of its claimed or actual power of eminent domain;
(ii) a realization upon a security interest;
(iii) any Permitted Payment or Restricted Payment that is permitted
hereunder; or
(iv) any sale, transfer, conveyance, lease or other disposition of the
Capital Stock or Property of a Restricted Subsidiary pursuant to the terms
of any power sales agreement or steam sales agreement or other agreement or
contract related to the output or product of, or services rendered by, a
Power Supply Business as to which such Restricted Subsidiary is the
supplying party; provided that to the extent the Company or any Restricted
Subsidiary receives any cash consideration in connection with such Asset
Disposition, the Net Cash Proceeds from such Asset Disposition shall be
applied in accordance with clause (ii) of this Section 4.15.
(b) If the aggregate purchase price of Securities and other Debt
tendered pursuant to an Offer made pursuant to clause (ii)(z) clause (a) above
is less than the Net Cash Proceeds allotted to the purchase of the Securities
and other Debt, the Company may use the remaining Net Cash Proceeds for general
corporate purposes. The Company will not be required to comply with the
provisions of clause (ii) in the first paragraph of this Section 4.15 if the Net
Cash Proceeds from one or more Asset Dispositions occurring on or after the date
of the Indenture are less than $40 million in any one fiscal year. Any lesser
amounts so carried forward and cumulated need not be segregated or reserved and
may be used for general corporate purposes.
(c) (i) Promptly, and in any event within 30 days from the Asset
Disposition and the receipt of the Net Cash Proceeds as to which the Company
must make an Offer, the
-63-
Company shall be obligated to deliver to the Trustee and send, by first-class
mail to each Holder of Securities, a written notice stating that:
(A) an Asset Disposition has occurred and that such Holders may tender all
or any portion of their Securities pursuant to the Offer in integral
multiples of $1,000 principal amount, at the applicable purchase price;
(B) any Security not tendered or accepted for payment will continue to
accrue interest;
(C) any Security accepted for payment pursuant to the Offer shall cease to
accrue interest after the Purchase Date (as defined below); and
(D) holders of Securities will be entitled to withdraw their election in
the manner described in clause (iii) of this Section 4.15(c).
The notice shall specify a purchase date not less than 30 days nor more than 60
days after the date of such notice (the "Purchase Date"), shall include all
instructions and materials necessary to enable each holders of Securities to
tender Securities pursuant to the Offer and shall contain information concerning
the business of the Company which the Company in good faith believes will enable
such holder to make an informed decision (which at a minimum will include (1)
the most recently filed Annual Report on Form 10-K (including audited
consolidated financial statements) of the Company, the most recent subsequently
filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the
Company filed subsequent to such Quarterly Report, other than Current Reports
describing other asset dispositions otherwise described in the offering
materials (or corresponding successor reports or reports otherwise required to
be delivered to holder of Securities if the Company is no longer filing reports
pursuant to the Securities Exchange Act of 1934), (2) a description of material
developments in the Company's business subsequent to the date of the latest of
such Reports, and (3) if material, appropriate pro forma financial information).
(ii) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Company shall deliver to the
Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer
Amount"), (B) the allocation of the Net Cash Proceeds pursuant to which such
Offer is being made and (C) the compliance of such allocation with the
provisions of this Section 4.15. Not later than one Business Day prior to the
Purchase Date, the Company shall also irrevocably deposit with the Trustee or
with the Paying Agent (or, if the Company is acting as its own
-64-
Paying Agent, segregate and hold in trust) in immediately available funds an
amount equal to the Offer Amount to be held for payment in accordance with the
provisions of this Section 4.15. Upon the expiration of the period for which the
Offer remains open (the "Offer Period"), the Company shall deliver to the
Trustee the Securities or portions thereof which have been properly tendered to
and are to be accepted by the Company. The Trustee or the Paying Agent (if any),
or the Company if acting as its own Paying Agent, shall, on the Purchase Date,
mail or deliver payment to each tendering Holder in the amount of the purchase
price. In the event that the aggregate purchase price of the Securities
delivered by the Company to the Trustee or the Paying Agent (if the Company is
not acting as its own Paying Agent) is less than the Offer Amount, the Trustee
or the Paying Agent, as the case may be, shall deliver the excess to the Company
immediately after the expiration of the Offer Period.
(iii) Any holder of Securities electing to have his Securities
purchased will be required to surrender such Securities, with an appropriate
form duly completed, to the Trustee at the address specified in the notice by
the close of business at least one Business Day prior to the Purchase Date.
Holders of Securities will be entitled to withdraw their election if the Trustee
or Paying Agent (if any) receives not later than the close of business on the
Business Day prior to the Purchase Date a facsimile transmission or letter
setting forth the name of the Holder and a statement that such Xxxxxx is
withdrawing his election to have all or a portion of his Securities purchased.
If at the expiration of the Offer Period the aggregate principal amount of
Securities surrendered by holders of Securities exceeds the Offer Amount, the
Company shall select the Securities to be purchased on a pro rata basis (with
such adjustments as may be deemed appropriate by the Company so that only
Securities in denominations of $1,000 or integral multiples thereof, shall be
purchased). Holders whose Securities are purchased only in part will be issued
new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(iv) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company will also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section 4.15. A Security
shall be deemed to have been accepted for purchase at the time the Trustee,
directly or through an agent, or the Company if acting as its own Paying Agent,
mails or makes available for delivery payment therefor to the surrendering
Holder.
(d) In the event the Company is unable to purchase Securities from
Holders thereof in an Offer because such
-65-
purchase is prohibited by any provision of applicable law, the Company need not
make an Offer. The Company shall then be obligated to use such Net Cash Proceeds
in accordance with clause (i)(B)(x) or (y) of this Section 4.15(c).
(e) Whenever Net Cash Proceeds are received by the Company, and prior
to the allocation of such Net Cash Proceeds pursuant to this Section 4.15, such
Net Cash Proceeds shall be set aside by the Company in a separate account
pending allocation.
The Company will comply with all applicable tender offer rules,
including without limitation Rule 14e-1 under the Exchange Act, in connection
with an Offer under the provisions of this covenant.
ARTICLE V
SUCCESSOR CORPORATION
SECTION 5.1 Merger, Consolidation, Etc.
The Company shall not consolidate with, merge with or into, or transfer
all or substantially all of its assets (as an entirety or substantially an
entirety in one transaction or a series of related transactions), to any Person
unless: (i) the Company shall be the continuing Person, or the Person (if other
than the Company) formed by such consolidation or into which the Company is
merged or to which properties and assets of the Company are transferred shall be
a solvent corporation organized and existing under the laws of the United States
or any State thereof or the District of Columbia and shall expressly assume in
writing all the obligations of the Company under the Securities and this
Indenture; (ii) immediately after giving effect to such transaction no Event of
Default or event or condition which through the giving of notice of lapse of
time or both would become an Event of Default shall have occurred and be
continuing; (iii) immediately after giving effect to such transaction on a pro
forma basis, the Company or the surviving entity would be able to incur at least
$1 of Debt under Section 4.8(a) and (iv) the Company or such Person shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture, comply with this provision of this Indenture and that all conditions
precedent in this Indenture relating to such transaction have been satisfied.
Notwithstanding the foregoing, clause (iii) of the preceding sentence shall not
prohibit a transaction, the principal purpose of which is (as
-66-
determined in good faith by the Board of Directors as evidenced by a Board
Resolution) to change the state of incorporation of the Company, and such
transaction does not have as one of its purposes the evasion of the limitations
imposed by this covenant.
SECTION 5.2 Successor Entity Substituted.
Upon any consolidation or merger, or any conveyance, lease or transfer
of all or substantially all of the assets of the Company in accordance with
Section 5.1, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, lease or transfer is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein; and thereafter (except in the case
of a sale, assignment, transfer, conveyance, lease or other disposition) the
Company shall be discharged from all obligations and covenants under this
Indenture and the Securities.
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.1 Events of Default.
An Event of Default, wherever used herein, shall occur with respect to
the Securities if:
(a) the Company defaults in the payment of all or any part of
principal, the Change of Control purchase price or premium, if any, on any
Security when the same becomes due and payable at maturity, upon acceleration,
redemption, mandatory repurchase, or otherwise;
(b) the Company defaults in the payment of interest on any Security
when the same becomes due and payable, and such default continues for a period
of 30 days;
(c) an event of default, as defined in any indenture or instrument
evidencing or under which the Company or any Significant Subsidiary has at the
date of this Indenture or shall hereafter have outstanding any Debt, shall
happen and be continuing and either
(i) such default results from the failure to pay the principal of such
Debt in excess of $50 million at final maturity of such Debt or
-67-
(ii) as a result of such default, the maturity of such Debt shall have
been accelerated so that the same shall be or become due and payable prior
to the date on which the same would otherwise have become due and payable,
and such acceleration shall not be rescinded or annulled within 60 days and
the principal amount of such Debt, together with the principal amount of any
other Debt of the Company or any Significant Subsidiary in default, or the
maturity of which has been accelerated, aggregates $50 million or more;
provided that such default shall not be an Event of Default if such Debt is
Debt of a Significant Subsidiary, is Non-Recourse to the Company in respect
of the amounts not paid or due upon acceleration and the Company could, at
the time of default, incur at least $1 of Debt under Section 4.8(a); and
provided, further, however that, subject to the provisions of Sections 7.1
and 7.2, the Trustee shall not be charged with knowledge of any such default
unless written notice thereof shall have been given to the Trustee by the
Company, by the holder or an agent of the holder of any such Debt, by the
trustee then acting under any indenture or other instrument under which such
default shall have occurred, or by the Holders of not less than 25% in the
aggregate principal amount of the Securities at the time outstanding;
(d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in this Indenture with respect to the
Securities or under the Securities and such default or breach continues for a
period of 60 consecutive days after written notice, specifying such failure and
demanding that the Company remedy the same, shall have been given by registered
mail, return-receipt requested to the Company by the Trustee or by the Holders
of 25% or more in aggregate principal amount of the Securities;
(e) one or more judgments or orders shall be entered by a court against
the Company or any Significant Subsidiary for the payment of money in an amount
which, individually or in the aggregate exceeds $50 million (excluding the
amount thereof covered by insurance or by a bond written by third parties but
treating any deductibles, self insurance or retentions as not so covered by
insurance) and which judgments or orders shall not be discharged or waived, and
shall remain outstanding and there shall be any period of 60 consecutive days
following entry of such judgment or order in excess of $50 million or the
judgment or order which causes the aggregate amount to exceed $50 million during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; provided, that such a judgment or
order shall not be an Event of Default if such judgment or order is against a
Significant Subsidiary and does not require any payment by the
-68-
Company and the Company could, at the expiration of the applicable 60 day
period, incur at least $1 of Debt under Section 4.8;
(f) a court having jurisdiction in the premises enters a decree or
order for (i) relief in respect of the Company or any of its Material
Subsidiaries in an involuntary case under any applicable bankruptcy, insolvency,
or other similar law now or hereafter in effect, (ii) appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator, or similar official of
the Company or any of its Material Subsidiaries or for all or substantially all
of the property and assets of the Company or any of its Material Subsidiaries or
(iii) the winding up or liquidation of the affairs of the Company or any of its
Material Subsidiaries and, in each case, such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(g) the Company or any of its Material Subsidiaries (i) commences a
voluntary case under any applicable bankruptcy, insolvency, or other similar law
now or hereafter in effect, or consents to the entry of an order for relief in
an involuntary case under any such law, (ii) consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator, or similar official of the Company or any of its Material
Subsidiaries or for all or substantially all of the property and assets of the
Company or any of its Material Subsidiaries or (iii) effects any general
assignment for the benefit of creditors.
SECTION 6.2 Acceleration.
(a) If an Event of Default (other than an Event of Default specified in
clauses (f) or (g) of Section 6.1 that occurs with respect to the Company)
occurs with respect to the Securities and is continuing under this Indenture,
then, and in each and every such case either the Trustee or the Holders of not
less than 25% in aggregate principal amount of the Securities then outstanding
by written notice to the Company (and to the Trustee if such notice is given by
the Holders (the "Acceleration Notice")), may, and the Trustee at the request of
such Holders shall, declare the principal of, premium, if any, and accrued
interest on the Securities to be immediately due and payable. Upon a declaration
of acceleration, such principal of, and accrued interest shall be immediately
due and payable.
(b) If an Event of Default specified in clauses (f) or (g) of Section
6.1 occurs with respect to the Company, the principal of, and accrued interest
on the Securities then outstanding shall ipso facto become and be immediately
due and payable, subject to the prior payment in full of all Senior
-69-
Debt, without any declaration or other act on the part of the Trustee or any
Holder. The Holders of at least a majority in principal amount of the
outstanding Securities may, by written notice to the Company and to the Trustee,
waive all past defaults with respect to the Securities and rescind and annul a
declaration of acceleration with respect to the Securities and its consequences
if (i) all existing Events of Default applicable to the Securities, other than
the nonpayment of the principal of, Change in Control purchase price or premium,
if any, and interest on the Securities that have become due solely by such
declaration of acceleration, have been cured or waived and (ii) the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction.
SECTION 6.3 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
SECTION 6.4 Waiver of Past Default.
Subject to Sections 6.2, 6.7 and 9.2, the Holders of, in the aggregate,
at least a majority in principal amount of the then outstanding Securities by
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default or Event of Default specified in Section 6.1(a)
or (b) or a Default or Event of Default in respect of any provision hereof which
cannot be modified or amended without the consent of the Holder so affected
pursuant to Section 9.2. When a Default or Event of Default is so waived, it
shall be deemed cured and cease to exist; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereto.
SECTION 6.5 Control by Majority.
The Holders of at least a majority in aggregate principal amount of the
outstanding the Securities may direct
-70-
the time, method, and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture, that may involve the Trustee in personal liability,
or that the Trustee determines in good faith may be unduly prejudicial to the
rights of Holders of the Securities not joining in the giving of such direction
and may take any other action it deems proper that is not inconsistent with any
such direction received from Holders of the Securities.
SECTION 6.6 Limitation on Suits.
A Holder may not pursue any remedy with respect to this Indenture or
the Securities unless:
(a) the Holder has previously given to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount of the
then outstanding Securities make a written request to the Trustee to pursue a
remedy;
(c) such Holder or Holders offer and, if requested, provide to the
Trustee indemnity reasonably satisfactory to the Trustee against any costs,
liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and offer of indemnity; and
(e) during such 60-day period the Holders of at least a majority in
aggregate principal amount of the then outstanding Securities do not give the
Trustee a direction which is inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another
Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.7 Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of and interest on a Security, on or
after the respective due dates expressed in the Security, or to bring suit for
the enforcement of any such payment on or after such respective dates, is
absolute and unconditional and shall not be impaired or affected without the
consent of such Holder.
-71-
SECTION 6.8 Collection Suit by Trustee.
If an Event of Default specified in Section 6.1(a) or (b) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or any other obligor on the Securities for
the whole amount of principal and accrued interest remaining unpaid, together
with interest overdue on principal and, to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the Interest Rate and such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.9 Trustee May File Proofs of Claim.
The Trustee shall be entitled and empowered to file such proofs of
claim and other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders allowed in any judicial proceedings relative to the
Company or any of its Subsidiaries (or any other obligor upon the Securities),
its creditors or its property and shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same, and any Custodian in any such judicial proceedings
is hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agent and counsel, and any other amounts due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 6.10 Priorities.
If the Trustee collects any money pursuant to this Article VI, it
shall, subject to the provisions of Article XI hereof, pay out such money in the
following order:
First: to the Trustee for amounts due under Section 7.7;
Second: subject to Article XI, to Holders for interest accrued on the
Securities, ratably, without preference or
-72-
priority of any kind, according to the amounts due and payable on the
Securities for interest; and
Third: subject to Article XI, to Holders for principal amounts owing
under the Securities, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for
principal.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.7, or a suit by any Holder, or group of Holders,
holding in the aggregate more than 10% in principal amount of the outstanding
Securities.
SECTION 6.12 Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and
every remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.13 Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article 6 or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
-73-
SECTION 6.14 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
SECTION 7.1 Duties of Trustee.
(a) If an Event of Default actually known to a Responsible Officer of
the Trustee has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties as are specifically set
forth in this Indenture or the TIA and no others and no implied covenants or
obligations shall be read into this Indenture against the Trustee.
(ii) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
in the case of any such certificate or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall examine such certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for
-74-
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) This paragraph does not limit the effect of paragraph (b) of this
Section 7.1.
(ii) The Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts.
(iii) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received
by it pursuant to Sections 6.2, 6.4 and 6.5.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.1.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.2 Rights of Trustee.
Subject to Section 7.1:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any document reasonably believed by it to be genuine and to
have been signed or presented by the proper Person. The Trustee shall not be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit, and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled during normal business hours and upon
reasonable
-75-
advance notice to the Company to examine the books, records and premises of the
Company, personally or by agent or attorney.
(b) Before the Trustee acts or refrains from acting with respect to any
matter contemplated by this Indenture, it may require an Officers' Certificate
or an Opinion of Counsel, which shall conform to the provisions of Section 10.5.
The Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent (other than the
negligence or willful misconduct of an agent who is an employee of the Trustee)
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith and without negligence which it reasonably believes to be
authorized or within its rights or powers conferred upon it by this Indenture or
the TIA.
(e) The Trustee may consult with counsel of its selection and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection from liability in respect of any action
taken, omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
(f) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture.
SECTION 7.3 Individual Rights of Trustee.
The Trustee in its individual capacity or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company, or
its Subsidiaries and Affiliates with the same rights it would have if it were
not Trustee. Any Agent may do the same with like rights. However, the Trustee is
subject to Sections 7.10 and 7.11.
-76-
SECTION 7.4 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, and it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Company in this Indenture, or any statement
in the Securities other than the Trustee's certificate of authentication.
SECTION 7.5 Notice of Defaults.
If a Default or an Event of Default with respect to the Securities
occurs and is continuing and a Responsible Officer of the Trustee receives
written notice of such Default or Event of Default, the Trustee shall mail to
each Securityholder notice of the Default or Event of Default within 90 days
after the occurrence thereof in accordance with TIA (0) 313(c). Except in the
case of a Default or an Event of Default in payment of principal of or interest
on any Security, including on acceleration, and the failure to make payment when
required by Section 4.11, and except in the case of a failure to comply with
Article V hereof, the Trustee may withhold the notice to the Securityholders for
a period not to exceed 60 days if and so long as a committee of its Trust
Officers in good faith determines that withholding the notice is in the interest
of Securityholders.
SECTION 7.6 Reports by Trustee to Holders.
To the extent required by XXX (0) 313(a), within 60 days after July 1
of each year commencing with 1998 and for as long as there are Securities
outstanding hereunder, the Trustee shall mail to each Holder the Company's brief
report dated as of such date that complies with TIA (0) 313(a). The Trustee also
shall comply with TIA (0) 313(b) and TIA (0) 313(c) and (d). A copy of such
report at the time of its mailing to Securityholders shall be filed with the
SEC, if required, and each stock exchange, if any, on which the Securities are
listed.
The Company shall promptly notify the Trustee if the Securities become
listed on any stock exchange and the Trustee shall comply with TIA (0) 313(d).
SECTION 7.7 Compensation and Indemnity.
The Company shall pay to the Trustee, the Paying Agent and the
Registrar from time to time such compensation as shall be agreed in writing with
the Company from time to time for their respective services rendered hereunder.
The Trustee's, the Paying Agent's and the Registrar's compensation shall not be
limited by any law in regard to the compensation of a trustee of an express
trust. The Company shall reimburse
-77-
the Trustee, the Paying Agent and the Registrar upon request for all reasonable
out-of-pocket disbursements, expenses and advances (including reasonable fees
and expenses of counsel) incurred or made by each of them in connection with
entering into this Indenture and the performance of its duties under this
Indenture, in addition to the compensation for their respective services under
this Indenture. Such expenses shall include the reasonable compensation,
out-of-pocket disbursements and expenses of the Trustee's, the Paying Agent's
and the Registrar's agents and counsel.
The Company shall indemnify the Trustee, the Paying Agent and the
Registrar for, and hold each of them harmless against, any and all claims,
demands, expenses (including but not limited to attorneys' fees and expenses),
loss or liability incurred by each of them arising out of or in connection with
the acceptance or administration of this Indenture and their respective duties
hereunder. Each of the Trustee, the Paying Agent and the Registrar shall notify
the Company promptly of any claim asserted against it for which it may seek
indemnity. However, failure by the Trustee, the Paying Agent or the Registrar to
so notify the Company shall not relieve the Company of its obligations
hereunder. The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee, the Paying Agent or the Registrar
through the Trustee's, the Paying Agent's or the Registrar's, as the case may
be, own willful misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section 7.7, each
of the Trustee, the Paying Agent and the Registrar shall have a lien prior to
the Securities on all money or property held or collected by it, in its capacity
as Trustee, Paying Agent or Registrar, as the case may be, except money or
property held in trust to pay principal of or interest on particular Securities.
When any of the Trustee, the Paying Agent and the Registrar incurs
expenses or renders services after an Event of Default specified in Section
6.1(f) or (g) occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any Bankruptcy Law. The
provisions of the Section shall survive the termination of this Indenture.
SECTION 7.8 Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company in
writing, such resignation to be effective upon the appointment of a successor
Trustee. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Trustee in writing and
-78-
xxx appoint a successor Trustee with the Company's consent which consent shall
not be unreasonably withheld. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent;
(c) a receiver or other public officer takes charge of the Trustee or
its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee (subject to the lien provided in Section 7.7), the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Xxxxxxx does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 25% in principal amount of then outstanding Securities may
petition, at the expense of the Company, any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
-79-
SECTION 7.9 Successor Trustee by Xxxxxx, Etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another corporation
or national banking association, the resulting, surviving or transferee
corporation or national banking association without any further act shall be the
successor Trustee, provided such corporation or national banking association
shall be otherwise qualified and eligible under this Article VII.
SECTION 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (0) 310(a)(1) and (2). There shall at all times be a Trustee
hereunder which shall be a Person that is eligible pursuant to the TIA to act as
such and has combined capital and surplus of at least $150,000,000. If such
Person publishes reports of condition at least annually, pursuant to law or to
the requirements of any supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. The Trustee shall comply with TIA (0) 310(b),
provided that there shall be excluded from the operation of TIA (0) 310(b)(1)
any indenture or indentures under which other securities, or certificates of
interest or participation in other securities, of the Company are outstanding if
the requirements for such exclusion set forth in TIA (0) 310(b)(1) are met. The
provisions of TIA (0) 310 shall apply to the Company, as obligor of the
Securities.
SECTION 7.11 Preferential Collection of
Claims Against Company.
The Trustee shall comply with TIA (0) 311(a), excluding any creditor
relationship listed in TIA (0) 311(b). A Trustee who has resigned or been
removed shall be subject to TIA (0) 311(a) to the extent indicated therein. The
provisions of TIA (0) 311 shall apply to the Company as obligor on the
Securities.
ARTICLE VIII
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
SECTION 8.1. Satisfaction and Discharge of Indenture.
If at any time (a) the Company shall have paid or caused to be paid the
principal of and interest on all the Securities outstanding hereunder (other
than Securities which
-80-
have been destroyed, lost or stolen and which have been replaced or paid as
provided in Section 2.7) as and when the same shall have become due and payable,
or (b) the Company shall have delivered to the Trustee for cancellation all
securities theretofore authenticated (other than any Securities which shall have
been destroyed, lost or stolen and which shall have been replaced or paid as
provided in Section 2.7) or (c) (i) all the securities not theretofore delivered
to the Trustee for cancellation shall have become due and payable, or are by
their terms to become due and payable within one year or are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption, and (ii) the Company shall have irrevocably
deposited or caused to be deposited with the Trustee as trust funds the entire
amount in cash (other than moneys repaid by the Trustee or any paying agent to
the Company in accordance with Section 8.4) or U.S. Government Obligations,
maturing as to principal and interest in such amounts and at such times as will
insure the availability of cash sufficient to pay at maturity or upon redemption
all Securities (other than those Securities which shall have been destroyed,
lost or stolen and which shall have been replaced or paid as provided in Section
2.7) not theretofore delivered to the Trustee for cancellation, including
principal and interest due or to become due on or prior to such date of maturity
as the case may be, and if, in any such case, the Company shall also pay or
cause to be paid all other sums payable hereunder by the Company with respect to
Securities, then this Indenture shall cease to be of further effect with respect
to Securities (except as to (i) rights of registration of transfer and exchange
of Securities, and the Company's right of optional redemption, if any, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen Securities, (iii)
rights of holders to receive payments of principal thereof and interest thereon,
upon the original stated due dates therefor (but not upon acceleration), (iv)
the rights, obligations and immunities of the Trustee hereunder and (v) the
rights of the Securityholders as beneficiaries hereof with respect to the
property so deposited with the Trustee payable to all or any of them, and the
Trustee, on demand of the Company accompanied by an Officers' Certificate and an
Opinion of Counsel and at the cost and expense of the Company, shall execute
proper instruments acknowledging such satisfaction of and discharging this
Indenture with respect to Securities; provided, that the rights of Holders of
the Securities to receive amounts in respect of principal of and interest on the
Securities held by them shall not be delayed longer than required by
then-applicable mandatory rules or policies of any securities exchange upon
which the Securities are listed. The Company agrees to reimburse the Trustee for
any costs or expenses thereafter reasonably and properly incurred and to
compensate the Trustee for any services
-81-
thereafter reasonably and properly rendered by the Trustee in connection with
this Indenture or the Securities.
SECTION 8.2. Application by Trustee of Funds
Deposited for Payment of Securities.
Subject to Section 8.4 and to the subordination provisions of Article
XI hereof, all moneys deposited with the Trustee pursuant to Section 8.1 shall
be held in trust and applied by it to the payment, either directly or through
any paying agent (including the Company acting as its own paying agent), to the
Holders of the particular Securities of such series for the payment or
redemption of which such moneys have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest; but such money
need not be segregated from other funds except to the extent required by law.
SECTION 8.3. Repayment of Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture
with respect to the Securities, all moneys then held by any paying agent under
the provisions of this Indenture with respect to the Securities shall, upon
demand of the Company, be repaid to it or paid to the Trustee and thereupon such
paying agent shall be released from all further liability with respect to such
moneys.
SECTION 8.4. Return of Moneys Held by Trustee and
Paying Agent Unclaimed for Two Years.
Any moneys deposited with or paid to the Trustee or any paying agent
for the payment of the principal of or interest on any Security and not applied
but remaining unclaimed for two years after the date upon which such principal
or interest shall have become due and payable, shall, upon the written request
of the Company and unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property law, be repaid to the
Company by the Trustee for such Securities or such paying agent, and the Holder
of the Security shall, unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property laws, thereafter look only
to the Company for any payment which such Holder may be entitled to collect, and
all liability of the Trustee or any paying agent with respect to such moneys
shall thereupon cease.
SECTION 8.5. Defeasance and Discharge of Indenture.
The Company shall be deemed to have paid and shall be discharged from
any and all obligations in respect of the
-82-
Securities of any series, on the 123rd day after the deposit referred to in
clause (A) hereof has been made, and the provisions of this Indenture shall no
longer be in effect with respect to the Securities (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except as to: (a) rights of registration of transfer and exchange, and
the Company's right of optional redemption, (b) substitution of apparently
mutilated, defaced, destroyed, lost or stolen Securities, (c) rights of holders
to receive payments of principal thereof and interest thereon, upon the original
stated due dates therefor (but not upon acceleration), (d) the rights,
obligations and immunities of the Trustee hereunder and (e) the rights of the
Securityholders as beneficiaries hereof with respect to the property so
deposited with the Trustee payable to all or any of them; provided that the
following conditions shall have been satisfied:
(A) with reference to this provision the Company has deposited or
caused to be irrevocably deposited with the Trustee (or another trustee
satisfying the requirements of Sections 7.8 and 7.10) as trust funds in
trust, specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of the Securities, (i) money in an amount,
or (ii) U.S. Government Obligations which through the payment of
interest and principal in respect thereof in accordance with their
terms will provide not later than one day before the due date of any
payment referred to in this clause (A) money in an amount, or (iii) a
combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge without consideration of the reinvestment of such interest
and after payment of all federal, state and local taxes or other
charges and assessments in respect thereof payable by the Trustee the
principal of, premium, if any, and each installment of interest on the
outstanding Securities on the due dates thereof or earlier redemption;
(B) the Company has delivered to the Trustee (i) either (x) an
Opinion of Counsel to the effect that Holders of Securities of such
series will not recognize income, gain or loss for federal income tax
purposes as a result of the Company's exercise of its option under this
Section 8.5 and will be subject to federal income tax on the same
amount and in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge had not occurred,
which Opinion of Counsel must be based upon a ruling of the Internal
Revenue Service to the same effect or a change in applicable federal
income tax law or related treasury regulations after the date of this
Indenture or (y) a
-83-
ruling directed to the Trustee received from the Internal Revenue
Service to the same effect as the aforementioned Opinion of Counsel
and (ii) an Opinion of Counsel to the effect that the creation of the
defeasance trust does not violate the Investment Company Act of 1940
and after the passage of 123 days following the deposit, the trust
fund will not be subject to the effect of Section 547 of the U.S.
Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law;
(C) immediately after giving effect to such deposit on a pro forma
basis, no Event of Default, or event that after the giving of notice or
lapse of time or both would become an Event of Default, shall have
occurred and be continuing on the date of such deposit or during the
period ending on the 123rd day after the date of such deposit, and such
deposit shall not result in a breach or violation of, or constitute a
default under, any other agreement or instrument to which the Company
is a party or by which the Company is bound;
(D) the Company is not prohibited from making payments in respect
of the Securities by Article XI hereof; and
(E) if at such time the Securities are listed on a national
securities exchange, the Company has delivered to the Trustee an
Opinion of Counsel to the effect that the Securities will not be
delisted as a result of such deposit, defeasance and discharge.
SECTION 8.6 Defeasance of Certain Obligations.
The Company may omit to comply with any term, provision or condition
set forth in, and this Indenture will no longer be in effect with respect to,
any covenant in Article V or Sections 4.5 through 4.15 and clauses (c) and (e)
of Section 6.1 shall not be deemed to be an Event of Default, if
(A) with reference to this Section 8.6, the Company has deposited
or caused to be irrevocably deposited with the Trustee (or another
trustee satisfying the requirements of Section 7.8) as trust funds in
trust, specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of the Securities and this Indenture with
respect to the Securities, (i) money in an amount or (ii) U.S.
Government Obligations which through the payment of interest and
principal in respect thereof in accordance with their terms will
provide not later than one day before the due dates thereof or earlier
redemption (irrevocably provided for under agreements satisfactory to
the Trustee), as the case may be, of any payment referred
-84-
to in this clause (A) money in an amount, or (iii) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge without
consideration of the reinvestment of such interest and after payment
of all federal, state and local taxes or other charges and assessments
in respect thereof payable by the Trustee the principal of, premium,
if any, and each installment of interest on the outstanding Securities
on the due date thereof or earlier redemption (irrevocably provided
for under arrangements satisfactory to the Trustee), as the case may
be;
(B) the Company has delivered to the Trustee (i) an Opinion of
Counsel to the effect that Holders of Securities will not recognize
income, gain or loss for federal income tax purposes as a result of the
Company's exercise of its option under this Section 8.6 and will be
subject to federal income tax on the same amount and in the same manner
and at the same times as would have been the case if such deposit and
defeasance had not occurred and (ii) an Opinion of Counsel to the
effect that the creation of the defeasance trust does not violate the
Investment Company Act of 1940 and after the passage of 123 days
following the deposit, the trust fund will not be subject to the effect
of Section 547 of the U.S. Bankruptcy Code or Section 15 of the New
York Debtor and Creditor Law;
(C) immediately after giving effect to such deposit on a pro forma
basis, no Event of Default, or event that after the giving of notice or
lapse of time or both would become an Event of Default, shall have
occurred and be continuing on the date of such deposit or during the
period ending on the 123rd day after the date of such deposit, and such
deposit shall not result in a breach or violation of, or constitute a
default under, any other agreement or instrument to which the Company
is a party or by which the Company is bound;
(D) the Company is not prohibited from making payments in respect
of the Securities by Article XI hereof; and
(E) if at such time the Securities are listed on a national
securities exchange, the Company has delivered to the Trustee an
Opinion of Counsel to the effect that the Securities will not be
delisted as a result of such deposit, defeasance and discharge.
-85-
SECTION 8.7 Reinstatement.
If the Trustee or paying agent is unable to apply any monies or U.S.
Government Obligations in accordance with Article 8 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article until
such time as the Trustee or paying agent is permitted to apply all such monies
or U.S. Government Obligations in accordance with this Article VIII; provided,
however, that if the Company has made any payment of principal of or interest on
any Securities because of the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Securities to receive
such payment from the monies or U.S. Government Obligations held by the Trustee
or paying agent.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by
resolutions of its Board of Directors (copies of which shall be delivered to the
Trustee) and the Trustee may amend, waive or supplement this Indenture or the
Securities without notice to or consent of any Holder for any of the following
purposes:
(a) to cure any ambiguity, defect or inconsistency in the Indenture,
provided that such amendments or supplements do not adversely affect the
interests of the Holders in any material respect;
(b) to provide for uncertificated Securities in addition to or in place
of certificated Securities;
(c) to comply with any requirements of the SEC under the TIA;
(d) to evidence the succession in accordance with Article V hereof of
another Person to the Company and the assumption by any such successor of the
covenants of the Company herein and in the Securities;
(e) to evidence and provide for the acceptance of appointment hereunder
by a separate or successor Trustee with respect to the Securities; or
-86-
(f) to make any other change that does not materially and adversely
affect the rights of any Holder;
provided, however, that in making such change, the Trustee may rely upon an
Opinion of Counsel stating that such change does not adversely affect the rights
of any Holder.
SECTION 9.2 With Consent of Holders.
Subject to Section 6.7 and the provisions of this Section 9.2, the
Company, when authorized by resolution of its Board of Directors (copies of
which shall be delivered to the Trustee) and the Trustee may amend or supplement
this Indenture, the Securities with the written consent of the Holders of at
least a majority in principal amount of the Securities then outstanding. Subject
to Section 6.7 and the provisions of this Section 9.2, the Holders of, in the
aggregate, at least a majority in principal amount of the then outstanding
Securities affected may waive compliance by the Company with any provision of
this Indenture, the Securities without notice to any other Securityholder.
However, without the consent of each Securityholder affected, an amendment,
supplement or waiver, including a waiver pursuant to Section 6.4, may not:
(a) reduce the principal amount of Securities the Holders of which must
consent to an amendment, supplement or waiver of any provision of or with
respect to this Indenture or the Securities; or
(b) reduce the principal amount of, premium, if any, or interest, on
any Security; or
(c) change the Stated Maturity of or any installment of interest on,
any Security; or
(d) make the principal of, or interest on, any Security payable in
money other than as provided herein, or
(e) make any change in provisions relating to waivers of defaults, the
ability of Holders to enforce their rights under this Indenture or in the
matters discussed in clauses (a) through (h); or
(f) adversely affect the ranking of the Securities this Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form
-87-
of any proposed amendment, supplement or waiver, but it shall be sufficient if
such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.2 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
Notwithstanding the foregoing, no amendment shall modify any provision of this
Indenture so as to affect adversely the rights of any holder of Senior
Indebtedness of the Company or Guarantor Senior Indebtedness to the benefits of
the subordination provisions under this Indenture without the consent of such
holder.
SECTION 9.3 Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Securities
shall be set forth in a supplemental indenture that complies with the TIA as
then in effect.
SECTION 9.4 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of that Security or portion of that Security that evidences the same debt
as the consenting Holder's Security, even if notation of the consent is not made
on any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security. Such revocation shall be
effective only if the Trustee receives the notice of revocation before the date
the amendment, supplement or waiver becomes effective. Notwithstanding the
above, nothing in this paragraph shall impair the right of any Securityholder
under (0) 316(b) of the TIA.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver which record date shall be at least 10 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the second and third sentences of the immediately preceding
paragraph, those Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date. Such
consent shall be effective only for actions taken within 90 days after such
record date.
-88-
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder unless it makes a change described in any of clauses
(a) through (h) of Section 9.2. In that case the amendment, supplement or waiver
shall bind each Holder of a Security who has consented to it.
SECTION 9.5 Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee shall (in accordance with the specific written direction of the
Company) request the Holder of the Security to deliver it to the Trustee. The
Trustee shall (in accordance with the specific direction of the Company) place
an appropriate notation on the Security about the changed terms and return it to
the Holder. Alternatively, if the Company or the Trustee so determines, the
Company in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms. Failure to make the
appropriate notation or issue a new Security shall not affect the validity and
effect of such amendment, supplement or waiver.
SECTION 9.6 Trustee to Sign Amendments, Etc.
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article IX if the amendment, supplement or waiver does not
adversely affect the rights, duties or immunities of the Trustee. If it does,
the Trustee may, but need not, sign it. In signing any amendment, supplement or
waiver, the Trustee shall be entitled to receive, if requested, an indemnity
reasonably satisfactory to it and to receive, and shall be fully protected in
relying upon, an Officers' Certificate and an Opinion of Counsel stating that
the execution of any amendment, supplement or waiver authorized pursuant to this
Article IX is authorized or permitted by this Indenture and that it constitutes
the legal, valid and binding obligation of the Company and subject to the
customary exceptions.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Trust Indenture Act Controls.
The provisions of TIA (0)(0) 310 through 317 that impose duties on any
person (including the provisions automatically deemed included unless expressly
excluded by this Indenture) are a part of and govern this Indenture, whether or
not physically contained herein.
-89-
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by the above paragraph, the imposed duties shall control.
SECTION 10.2 Notices.
Any notice or communication shall be sufficiently given if in writing
and delivered in person or mailed by first-class mail or by telecopier, followed
by first-class mail, or by overnight service guaranteeing next-day delivery,
addressed as follows:
(a) if to the Company:
The AES Corporation
0000 Xxxxx 00xx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopier Number: (000) 000-0000
with a copy to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx, Xx.
Telecopier Number: (000) 000-0000
(b) if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Trustee Administration
Telecopier Number: (000) 000-0000
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder, including any
notice delivered in connection with TIA (0) 310(b), TIA (0) 313(c), TIA (0)
314(a) and TIA (0) 315(b), shall be mailed to such Holder, first-class postage
prepaid, at his address as it appears on the registration books of the Registrar
and shall be sufficiently given to such Holder if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its
-90-
sufficiency with respect to other Securityholders. Except for a notice to the
Trustee, which is deemed given only when received by an officer in the corporate
trust department of the Trustee, if a notice or communication is mailed in the
manner provided above, it is duly given, whether or not the addressee receives
it. In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.
SECTION 10.3 Communications by Holders with
Other Holders.
Securityholders may communicate pursuant to TIA (0) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA (0) 312(c).
SECTION 10.4 Certificate and Opinion of Counsel
as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee at the
request of the Trustee (a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with (which officer signing
such certificate may rely, as to matters of law, on an Opinion of Counsel), (b)
an Opinion of Counsel in form and substance reasonably satisfactory to the
Trustee stating that, in the opinion of counsel, all such conditions have been
complied with (which counsel, as to factual matters, may rely on an Officers'
Certificate) and (c) where applicable, a certificate or opinion by an
independent certified public accountant satisfactory to the Trustee that
complies with TIA (0) 314(c).
SECTION 10.5 Statements Required in Certificate
and Opinion of Counsel.
Each certificate and Opinion of Counsel with respect to compliance with
a condition or covenant provided for in this Indenture shall include:
(a) a statement that the Person making such certificate or rendering
such Opinion of Counsel has read such covenant or condition;
-91-
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or Opinion of Counsel are based;
(c) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
SECTION 10.6 Rules by Trustee, Paying Agent,
Registrar.
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Securityholders. The Paying
Agent or Registrar may make reasonable rules for its functions.
SECTION 10.7 Legal Holidays.
If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period.
SECTION 10.8 Governing Law.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. THE COMPANY AGREES
TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND THE
SECURITIES.
SECTION 10.9 No Recourse Against Others.
A trustee, director, officer, employee, stockholder or beneficiary, as
such, of the Company shall not have any liability for any obligations of the
Company under the Securities or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each Security
holder by accepting a Security waives and releases all such liability.
-92-
SECTION 10.10 Successors.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 10.11 Counterparts.
The parties may sign any number of counterparts of this Indenture. Each
such counterpart shall be an original, but all of them together represent the
same agreement.
SECTION 10.12 Severability.
In case any provision in this Indenture or the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby,
and a Holder shall have no claim therefor against any party hereto.
SECTION 10.13 Table of Contents, Headings, Etc.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, and are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 10.14 No Adverse Interpretation
of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
SECTION 10.15 Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture or the Securities.
SECTION 10.16 Independence of Covenants.
All covenants and agreements in this Indenture and the Securities shall
be given independent effect so that if any particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or otherwise be within the limitations of, another covenant
-93-
shall not avoid the occurrence of a Default or an Event of Default if such
action is taken or condition exists.
ARTICLE XI
SUBORDINATION OF SECURITIES
SECTION 11.1 Agreement to Subordinate.
The Company covenants and agrees, and each Holder of Securities issued
hereunder by his acceptance thereof likewise covenants and agrees, that all
Securities shall be issued subject to the provisions of this Article; and each
person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof accepts and agrees that the Principal of and
interest on all Securities issued hereunder shall, to the extent and in the
manner herein set forth, be subordinated and subject in right to the prior
payment in full of all Senior Debt.
SECTION 11.2 Payments to Securityholders.
No payments on account of Principal of, Change of Control purchase
price, or interest on the Securities shall be made if at the time of such
payment or immediately after giving effect thereto there shall exist a default
in any payment with respect to any Senior Debt, and such event of default shall
not have been cured or waived or shall not have ceased to exist. In addition,
during the continuance of any other event of default (other than a payment
default) with respect to Designated Senior Debt pursuant to which the maturity
thereof may be accelerated, from and after the date of receipt by the Trustee of
written notice from the holders of such Designated Senior Debt or from an agent
of such holders, no payments on account of Principal, Change of Control purchase
price, or interest in respect of the Securities may be made by the Company for a
period ("Payment Blockage Period") commencing on the date of delivery of such
notice and ending 179 days thereafter (unless such Payment Blockage Period shall
be terminated by written notice to the Trustee from the holders of such
Designated Senior Debt or from an agent of such holders, or such event of
default has been cured or waived or has ceased to exist). Only one Payment
Blockage Period may be commenced with respect to the Securities during any
period of 360 consecutive days. No event of default which existed or was
continuing on the date of the commencement of any Payment Blockage Period with
respect to the Designated Senior Debt initiating such Payment Blockage Period
shall be or be made the basis for the commencement of any subsequent Payment
Blockage Period by the holders of such Designated Senior Debt, unless
-94-
such event of default shall have been cured or waived for a period of not less
than 90 consecutive days.
Upon any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to creditors upon any
liquidation, dissolution, winding up, receivership, reorganization, assignment
for the benefit of creditors, marshalling of assets and liabilities or any
bankruptcy, insolvency or similar proceedings of the Company, all amounts due or
to become due upon all Senior Debt shall first be paid in full, in cash or cash
equivalents, or payment thereof provided for in accordance with its terms,
before any payment is made on account of the Principal of, Change of Control
purchase price, or interest on the indebtedness evidenced by the Securities, and
upon any such liquidation, dissolution, winding up, receivership,
reorganization, assignment, marshalling or proceeding, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to which the Holders of the Securities or the Trustee
under this Indenture would be entitled, except for the provisions hereof, shall
be paid by the Company or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other Person making such payment or distribution, or by the
Holders of the Securities or by the Trustee under this Indenture if received by
them or it, directly to the holders of Senior Debt (pro rata to such holders on
the basis of the respective amounts of Senior Debt held by such holders) or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any of such Senior Debt
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Debt in full (including, without limitation, except
to the extent, if any, prohibited by mandatory provisions of law, post-petition
interest, in any such proceedings), after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt, before any payment
or distribution is made to the holders of the indebtedness evidenced by the
Securities or to the Trustee under this Indenture.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee under this Indenture or the holders of the Securities before all Senior
Debt is paid in full or provision is made for such payment in accordance with
its terms, such payment or distribution shall be held in trust for the benefit
of and shall be paid over or delivered to the holders of such Senior Debt or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any of such Senior Debt
may have been issued, as their respective
-95-
interests may appear, for application to the payment of all Senior Debt
remaining unpaid until all such Senior Debt shall have been paid in full in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Debt.
For purposes of this Article, the words, "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of arrangement, reorganization or readjustment, the payment of which
is subordinated (at least to the extent provided in this Article with respect to
the Securities) to the payment of all Senior Debt which may at the time be
outstanding; provided, that (i) the Senior Debt is assumed by the new
corporation, if any, resulting from any such arrangement, reorganization or
readjustment, and (ii) the rights of the holders of the Senior Debt are not,
without the consent of such holders, altered by such arrangement, reorganization
or readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided in Article V shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section if such other
corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article V. Nothing in this
Section shall apply to claims of, or payments to, the Trustee under or pursuant
to Article VII, except as provided therein. This Section shall be subject to the
further provisions of Section 11.5.
SECTION 11.3 Subrogation of Securities.
Subject to the payment in full of all Senior Debt, the holders of the
Securities shall be subrogated to the rights of the holders of Senior Debt to
receive payments or distributions of cash, property or securities of the Company
applicable to the Senior Debt until the principal of and interest on the
Securities shall be paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of the Senior Debt of any cash,
property or securities to which the holders of the Securities or the Trustee on
their behalf would be entitled except for the provisions of this Article, and no
payment over pursuant to the provisions of this Article to the holders of Senior
Debt by holders of the Securities or the Trustee on their behalf shall, as
between the Company, its creditors other than holders of Senior Debt and the
holders of the Securities, be deemed to be a payment by the Company to or on
account of the Senior Debt;
-96-
and no payments or distributions of cash, property or securities to or for the
benefit of the Securityholders pursuant to the subrogation provision of this
Article, which would otherwise have been paid to the holders of Senior Debt
shall be deemed to be a payment by the Company to or for the account of the
Securities. It is understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights of the holders
of the Securities, on the one hand, and the holders of the Senior Debt, on the
other hand.
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Debt, and the holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Securities the principal of and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the
holders of the Securities and creditors of the Company other than the holders of
the Senior Debt, nor shall anything herein or therein prevent the holder of any
Security or the Trustee on his behalf from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article of the holders of Senior Debt in respect of
cash, property or securities of the Company received upon the exercise of any
such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Sections 7.1 and 7.2,
and the holders of the Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which such liquidation,
dissolution, winding up, receivership, reorganization, assignment or marshalling
proceedings are pending, or a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, delivered to the Trustee or to the holders of the Securities, for
the purpose of ascertaining the persons entitled to participate in such
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 11.4 Authorization by Securityholders.
Each holder of a Security by his acceptance thereof authorizes the
Trustee in his behalf to take such action as may be necessary or appropriate to
effectuate the subordination
-97-
provided in this Article and appoints the Trustee his attorney-in-fact for any
and all such purposes.
SECTION 11.5 Notice to Trustee.
The Company shall give prompt written notice to the Trustee and to any
paying agent of any fact known to the Company which would prohibit the making of
any payment of moneys to or by the Trustee or any paying agent in respect of the
Securities pursuant to the provisions of this Article. Regardless of anything to
the contrary contained in this Article or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any Senior Debt
or of any default or event of default with respect to any Senior Debt or of any
other facts which would prohibit the making of any payment of moneys to or by
the Trustee, unless and until the Trustee shall have received notice in writing
at its principal Corporate Trust Office to that effect signed by an officer of
the Company, or by a holder or agent of a holder of Senior Debt who shall have
been certified by the Company or otherwise established to the reasonable
satisfaction of the Trustee to be such holder or agent, or by the trustee under
any indenture pursuant to which Senior Debt shall be outstanding, and, prior to
the receipt of any such written notice, the Trustee shall, subject to Sections
7.1 and 7.2, be entitled to assume that no such facts exist; provided that if on
a date at least three Business Days prior to the date upon which by the terms
hereof any such moneys shall become payable for any purpose (including, without
limitation, the payment of the principal of, or interest on any Security) the
Trustee shall not have received with respect to such moneys the notice provided
for in this Section, then, regardless of anything herein to the contrary, the
Trustee shall have full power and authority to receive such moneys and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or after such prior
date.
Regardless of anything to the contrary herein, nothing shall prevent
(a) any payment by the Company or the Trustee to the Securityholders of amounts
in connection with a redemption of Securities if (i) notice of such redemption
has been given pursuant to Article III prior to the receipt by the Trustee of
written notice as aforesaid, and (ii) such notice of redemption is given not
earlier than 60 days before the redemption date, or (b) any payment by the
Trustee to the Securityholders of amounts deposited with it pursuant to Section
8.1.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a person representing himself to be a holder of Senior Debt
(or a trustee on behalf of such
-98-
holder) to establish that such notice has been given by a holder of Senior Debt
or a trustee on behalf of any such holder. In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any person as a holder of Senior Debt to participate in any payment or
distribution pursuant to this Article, the Trustee may request such person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Debt held by such person, the extent to which such person is entitled
to participate in such payment or distribution and any other facts pertinent to
the rights of such person under this Article, and if such evidence is not
furnished the Trustee may defer any payment to such person pending judicial
determination as to the right of such person to receive such payment.
SECTION 11.6 Trustee's Relation to Senior Debt.
The Trustee and any agent of the Company or the Trustee shall be
entitled to all the rights set forth in this Article with respect to any Senior
Debt which may at any time be held by it in its individual or any other capacity
to the same extent as any other holder of Senior Debt and nothing in this
Indenture shall deprive the Trustee or any such agent, of any of its rights as
such holder. Nothing in this Article shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 7.7.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article, and no implied covenants or obligations
with respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Debt and, subject to the provisions of Sections 7.1 and
7.2, the Trustee shall not be liable to any holder of Senior Debt if it shall
pay over or deliver to holders of Securities, the Company or any other person
moneys or assets to which any holder of Senior Debt shall be entitled by virtue
of this Article or otherwise.
SECTION 11.7 No Impairment of Subordination.
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with.
S-1
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
THE AES CORPORATION,
as Issuer
By:
---------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By: ---------------------------------
Name:
Title:
EXHIBIT A
(FORM OF FACE OF SECURITY)
No. [ ] $ CUSIP NO.:
8 3/8% SENIOR SUBORDINATED NOTE DUE 2007
THE AES CORPORATION promises to pay
to [ ] or registered assigns the
principal sum of[ ] Dollars on
August 15, 2007.
Interest Payment Dates: February 15, August 15 and at maturity
Record Dates: February 1 or August 1 as the case may be, next preceding such
Interest Payment Date
By:
---------------------------------
Authorized Signature
By:
---------------------------------
Authorized Signature
Dated: July 17, 1997
Certificate of Authentication
This is one of the 8 3/8% Senior Subordinated Notes due 2007 referred
to in the within-mentioned indenture.
The Bank of New York, as Trustee
By: ---------------------------------
Authorized Signatory
A-1
THE AES CORPORATION
8 3/8% SENIOR SUBORDINATED NOTE DUE 2007
1. Interest. THE AES CORPORATION, a Delaware corporation (the
"Company," which definition shall include any successor thereto in accordance
with the Indenture (as defined below)), promises to pay, until the principal
hereof is paid or made available for payment, interest on the principal amount
set forth on the reverse side hereof at a rate of 8 3/8% per annum. Interest on
the Securities will accrue from and including the most recent date to which
interest has been paid or, if no interest has been paid, from July 17, 1997
through but excluding the date on which interest is paid. Interest shall be
payable in arrears on February 15, August 15 and at the stated maturity (each an
"Interest Payment Date"), commencing February 15, 1998. Interest will be
computed on the basis of a 360 day year of twelve 30 day months.
2. Method of Payment. The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are registered Holders of
Securities at the close of business on February 1 and August 1 next preceding
the Interest Payment Date. Holders must surrender Securities to a Paying Agent
to collect principal payments. The Company will pay principal, premium, if any,
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. At the Company's option,
interest may be paid by check mailed to the registered address of the Holder of
this Security.
3. Paying Agent and Registrar. Initially, The Bank of New York (the
"Trustee") will act as Paying Agent and Registrar. The Company may change any
Paying Agent, Registrar or co-Registrar without notice. Neither the Company nor
any of its Subsidiaries may act as Paying Agent, Registrar or co-Registrar.
4. Indenture. The Company issued the Securities under an Indenture
dated as of July 17, 1997 (the "Indenture") between the Company and the Trustee.
This Security is one of an issue of Securities of the Company issued under the
Indenture. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code (0)(0) 77aaa-77bbbb) as amended from time to time. The Securities
are subject to all such terms, and Securityholders are referred to the Indenture
and such Act for a statement of them.
A-2
Capitalized terms used herein and not otherwise defined have the meanings set
forth in the Indenture. The Securities are general unsecured obligations of the
Company subordinated in right of payment to all Senior Debt of the Company,
limited in aggregate principal amount to $325,000,000. The Indenture limits,
among other things, the ability of the Company and its Restricted Subsidiaries
to incur certain Debt; pay dividends and make other distributions; make certain
investments; engage in unrelated businesses; dispose of certain Assets; engage
in transactions with certain Affiliates; and merge with or into another entity.
The limitations are subject to a number of important qualifications and
exceptions. The Company must report to the Trustee annually whether it is in
compliance with the limitations contained in the Indenture.
5. Optional Redemption.
The Securities are subject to redemption upon not less than 30 nor more
than 60 days' notice by mail, at any time on or after August 15 ______________,
2002, as a whole or in part, at the election of the Company, at the following
Redemption Prices (expressed as percentages of the principal amount): If
redeemed during the 12-month period beginning on or after August 15___________
of the years set forth below,
Redemption
Year Price
---- ----------
2002 104.188_______
___%
2003 102.094_______
___%
and after August 15, 2004 at a Redemption Price equal to 100% of the principal
amount, together in the case of any such redemption with accrued interest to the
Redemption Date.
In addition prior to August 15, 2000, in the event that the Company
consummates one or more offerings of its Qualified Capital Stock, the Company
may at its option, use all or a portion of the proceeds therefrom to redeem up
to 33% of the original aggregate principal amount at maturity of the Securities
at a cash redemption price equal to 108.375% of the principal amount thereof,
plus accrued and unpaid interest thereon through the date of repurchase;
provided that at least $100 million of the original aggregate principal amount
of the Securities remains outstanding thereafter.
6. Offers to Purchase. Section 4.11 of the Indenture provides upon the
occurrence of a Change of Control and subject to further limitations contained
therein, the
A-3
Company shall make an offer to purchase the Securities in accordance with the
procedures set forth in the Indenture.
7. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay to it any taxes and
fees required by law or permitted by the Indenture. The Registrar need not
transfer or exchange any Security or portion of a Security selected for
redemption, or transfer or exchange any Securities for a period of 15 days
before the mailing of a notice of redemption of Securities to be redeemed.
8. Persons Deemed Owners. The registered holder of a Security may be
treated as the owner of it for all purposes.
9. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Company at its written request. After that, Holders entitled to the
money must look to the Company for payment as general creditors unless an
"abandoned property" law designates another Person.
10. Amendment, Supplement, Waiver. The Company and the Trustee may,
without the consent of the holders of any outstanding Securities, amend, waive
or supplement the Indenture, the Securities for certain specified purposes,
including, among other things, curing ambiguities, defects or inconsistencies,
maintaining the qualification of the Indenture under the Trust Indenture Act of
1939 or making any other change that does not adversely affect the rights of any
Holder. Other amendments and modifications of the Indenture or the Securities
may be made by the Company and the Trustee with the consent of the Holders of
not less than a majority of the aggregate principal amount of the outstanding
Securities, subject to certain exceptions requiring the consent of the Holders
of the particular Securities to be affected.
11. Successor Corporation. When a successor corporation assumes all the
obligations of its predecessor under the Securities and the Indenture and the
transaction complies with the terms of Article V of the Indenture, the
predecessor corporation, subject to certain exceptions, will be released from
those obligations.
12. Defaults and Remedies. Events of Default are set forth in the
Indenture. Subject to certain limitations in the Indenture, if an Event of
Default (other than an Event of Default specified in Section 6.1(f) or (g) of
the Indenture
A-4
with respect to the Company) occurs and is continuing, then the holders of not
less than 25% in aggregate principal amount of the outstanding Securities may,
or the Trustee may, declare the principal of, premium, if any, plus accrued
interest, if any, to be due and payable immediately. If an Event of Default
specified in Section 6.1(f) or (g) of the Indenture with respect to the Company
occurs and is continuing, the principal of, premium, if any, and accrued
interest on all of the Securities shall ipso facto become and be immediately due
and payable subject to the prior payment in full of Senior Debt without any
declaration or other act on the part of the Trustee or any Holder.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may require indemnity reasonably
satisfactory to it before it enforces the Indenture or the Securities. Subject
to certain limitations, Holders of a majority in principal amount of the then
outstanding Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
default (except a default in payment of principal or interest or a failure to
comply with Article V of the Indenture) if it determines that withholding notice
is in their interests. The Company must furnish an annual compliance certificate
to the Trustee.
13. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not Trustee.
14. No Recourse Against Others. A director, officer, employee,
stockholder or beneficiary, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of, such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
15. Defeasance. The Indenture contains provisions (which provisions
apply to this Security) for defeasance at any time of (a) the entire
indebtedness of the Company or this Security and (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon
compliance by the Company with certain conditions set forth therein.
16. Authentication. This Security shall not be valid until the Trustee
signs the certificate of authentication on the other side of this Security.
17. Abbreviations. Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as:
A-5
TEN COM (= tenants in common), TENANT (= tenants by the entireties), JT TEN (=
joint tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
18. Subordination. The Company's payment of principal of, premium, if
any, and interest on the Securities is subordinated in right of payment, to the
extent and in the manner provided in Article XI of the Indenture, to the prior
payment in full of the Senior Debt of the Company. Each Holder of the
Securities, by his acceptance hereof, covenants and agrees that all payments of
the principal of, premium, if any, and interest on the Securities by the Company
shall be subordinated in accordance with the provisions of Article XI of the
Indenture, and each Holder accepts and agrees to be bound by such provisions.
19. GOVERNING LAW. THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture. Requests may be made to:
THE AES CORPORATION
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: General Counsel
A-6
ASSIGNMENT FORM
If you the holder want to assign this Security, fill in the form below and have
your signature guaranteed:
I or we assign and transfer this Security to
_______________________________________________________________________________
(Insert assignee's social security or tax ID number)___________________________
________________________________________________________________________________
________________________________________________________________________________
_____________________________
(Print or type assignee's name, address and zip code) and irrevocably appoint
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
_____________________________
_____________________________
Date: _______________________
Your signature:
_____________________________
(Sign exactly as your
name appears on the
other side of this
Security)
Signature Guarantee:____________________________________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant to
Section 4.11 or 4.15 of the Indenture, check the Box: [ ]
If you wish to have a portion of this Security purchased by the Company
pursuant to Section 4.11 or 4.15 of the Indenture, state the amount: $
Date:________________________
Your signature:
_____________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:___________________________________________________
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
The AES Corporation
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
[Name and Address of Registrar]
Re: 8 3/8% Senior Subordinated Notes due 2007
Reference is hereby made to the Indenture, dated as of July 17, 1997
(the "Indenture"), between The AES Corporation (the "Issuer") and The Bank of
New York, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
________________, (the "Transferor") owns and proposes to transfer the
Security[s] specified in Annex A hereto in the principal amount of $___ in such
Security[s] (the "Transfer"), to ________ (the "Transferee"), as further
specified in Annex A hereto. In the event that Transferor holds Physical
Securities, this Certificate is accompanied by one or more certificates
aggregating at least the principal
B-1
amount of Securities proposed to be Transferred. In connection with the
Transfer, the Transferor hereby certifies that:
1. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE 144A GLOBAL SECURITY.
The Transfer is being effected pursuant to and in accordance with Rule 144A
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
Securities are being transferred to a Person that the Transferor reasonably
believes is purchasing the Securities for its own account, or for one or more
accounts with respect to which such Person exercises sole investment discretion,
and such Person and each such account is a "qualified institutional buyer"
within the meaning of Rule 144A in a transaction meeting the requirements of
Rule 144A and such Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
Security will be subject to the restrictions on transfer enumerated in the
Securities Act Legend and in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE REGULATION S GLOBAL
SECURITY PURSUANT TO REGULATION S. The Transfer is being effected pursuant to
and in accordance with Rule 904 under the Securities Act and, accordingly, the
Transferor hereby further certifies that (i) the Transfer is
B-2
not being made to a person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 904(b) of Regulation S under the Securities Act and (iii) the transaction
is not part of a plan or scheme to evade the registration requirements of the
Securities Act. Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the Security will be subject to the restrictions on
Transfer enumerated in the Securities Act Legend printed on the Regulation S
Global Security and in the Indenture and the Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A RESTRICTED
PHYSICAL SECURITY PURSUANT TO RULE 144A OR REGULATION S. One or more of the
events specified in Section 2.6(a) of the Indenture have occurred and the
Transfer is being effected in compliance with the transfer restrictions
applicable to Securities bearing the Securities Act Legend and pursuant to and
in accordance with the Securities Act, and
B-3
accordingly the Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144A under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 1 above; or
(b) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 904 under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 2 above.
4. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE UNRESTRICTED GLOBAL
SECURITY The Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture, and the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transfer Securities will no
longer be subject to the restrictions on transfer enumerated in the Securities
Act Legend and in the Indenture and the Securities Act.
B-4
5. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE PHYSICAL GLOBAL SECURITY
THAT DOES NOT BEAR THE SECURITIES ACT LEGEND One or more of the events specified
in Section 2.6(a) of the Indenture have occurred and the Transfer is being
effected pursuant to and in accordance with Rule 144 under the Securities Act
and in compliance with the transfer restrictions contained in the Indenture, and
the restrictions on transfer contained in the Indenture and the Securities Act
Legend are not required in order to maintain compliance with the Securities Act.
Upon consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred Securities will no longer be subject to the
restrictions on transfer enumerated in the Securities Act Legend and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Guarantors.
----------------------------------
[Insert Name of Transferor]
By:
----------------------------------
Name:
Title:
Dated:_________________
B-5
FORM OF ANNEX A TO CERTIFICATE
OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] Interests in the
(i) [ ] 144A Global Security (CUSIP _____), or
(ii) [ ] Regulation S Global Security (CINS _____).
(b) oPhysical Security.
2. That the Transferee will hold:
[CHECK ONE]
(a) [ ] Interests in the:
(i) o144A Global Security (CUSIP _____), or
(ii) oRegulation S Global Security (CINS _____), or
(iii) oUnrestricted Global Security (CUSIP _____); or
(b) [ ] Physical Securities that bear the Securities Act Legend;
(c) [ ]Physical Securities that do not bear the Securities Act Legend;
B-6
in accordance with the terms of the Indenture.
B-7
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
The AES Corporation
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
[Name and Address of Registrar]
Re: 8 3/8% Senior Subordinated Notes due 2007
(CUSIP _______________)
Reference is hereby made to the Indenture, dated as of July 17, 1997
(the "Indenture"), between The AES Corporation (the "Issuer") and The Bank of
New York, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
__________, (the "Holder") owns and proposes to exchange the
Security[s] specified herein, in the principal amount of $___ in such
Security[s] (the "Exchange"). In the event Holder holds Physical Securities,
this Certificate is accompanied by one or more certificates aggregating at least
the principal amount of Securities proposed to be Exchanged.
C-1
In connection with the Exchange, the Holder hereby certifies that:
1. EXCHANGE OF RESTRICTED PHYSICAL SECURITIES OR INTERESTS IN THE INITIAL GLOBAL
SECURITY FOR PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT LEGEND OR
UNRESTRICTED GLOBAL SECURITIES
(a [ ] CHECK IF EXCHANGE IS FROM INITIAL GLOBAL SECURITIES TO THE
UNRESTRICTED GLOBAL SECURITY. In connection with the Exchange of the Holder's
Initial Global Security to the Unrestricted Global Security in an equal
principal amount, the Holder hereby certifies (i) the Unrestricted Global
Securities are being acquired for the Holder's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Initial Global Securities and pursuant to and in
accordance with the Securities Act of 1933, as amended (the "Securities Act")
and (iii) the restrictions on transfer contained in the Indenture and the
Securities Act Legend are not required in order to maintain compliance with the
Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO AN
INTEREST IN THE UNRESTRICTED GLOBAL SECURITY. In connection with the Holder's
Exchange of Restricted Physical Securities for Interest in the Unrestricted
Global Security, (i) the Interest in the Unrestricted Global Security are being
acquired for the Holder's own account without transfer,
C-2
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to Restricted Physical Securities and pursuant to and in
accordance with the Securities Act and (iii) the restrictions on transfer
contained in the Indenture and the Securities Act Legend are not required in
order to maintain compliance with the Securities Act.
(C) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO
PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT LEGEND. In connection
with the Holder's Exchange of a Restricted Physical Security for Physical
Securities that do not bear the Securities Act Legend, the Holder hereby
certifies (i) the Physical Securities that do not bear the Securities Act Legend
are being acquired for the Holder's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Physical Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act and (iv) one or more of the events specified
in Section 2.6(a) of the Indenture have occurred.
2. [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO INTERESTS IN
AN INITIAL GLOBAL SECURITY. In connection with the Exchange of the Holder's
Restricted
Physical Security for interests in the Initial Global Security in the [CHECK
ONE] [ ] 144A Global Security, [ ] Regulation S Global Security, with an equal
principal amount, (i) the interests in the Initial Global Security are being
acquired for the Holder's own account without transfer and (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Restricted Physical Security and pursuant to and in accordance with the
Securities Act. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Initial Global Security issued will be subject
to the restrictions on transfer enumerated in the Securities Act Legend printed
on the Initial Global Securities and in the Indenture and the Securities Act.
C-4
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
---------------------------------
[Insert Name of Holder]
By:
---------------------------------
Name:
Title:
Dated:_________________
C-5
