Exhibit 4.8
EXECUTION COPY
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DYNEGY HOLDINGS INC.
and each of the Guarantors named herein
SECOND PRIORITY SENIOR SECURED FLOATING RATE NOTES DUE 2008
9.875% SECOND PRIORITY SENIOR SECURED NOTES DUE 2010
10.125% SECOND PRIORITY SENIOR SECURED NOTES DUE 2013
INDENTURE
Dated as of August 11, 2003
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Wilmington Trust Company,
as Trustee
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Xxxxx Fargo Bank Minnesota, N.A.,
as Collateral Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310(a)(1)..................................................... 7.10
(a)(2)..................................................... 7.10
(a)(3)..................................................... N.A.
(a)(4)..................................................... N.A.
(a)(5)..................................................... 7.10
(b)........................................................ 7.10
(c)........................................................ N.A.
311(a)........................................................ 7.11
(b)........................................................ 7.11
(c)........................................................ N.A.
312(a)........................................................ 2.05
(b)........................................................ 14.03
(c)........................................................ 14.03
313(a)........................................................ 7.06
(b)(2)..................................................... 7.06; 7.07
(c)........................................................ 7.06; 12.02
(d)........................................................ 7.06
314(a)........................................................ 4.03;4.04; 14.05
(c)(1)..................................................... 14.04
(c)(2)..................................................... 14.04
(c)(3)..................................................... N.A.
(e)........................................................ 14.05
(f)........................................................ N.A.
315(a)........................................................ 7.01
(b)........................................................ 7.05,14.02
(c)........................................................ 7.01
(d)........................................................ 7.01
(e)........................................................ 6.11
316(a) (last sentence)........................................ 2.09
(a)(1)(A).................................................. 6.05
(a)(1)(B).................................................. 6.04
(a)(2)..................................................... N.A.
(b)........................................................ 6.07
(c)........................................................ 6.10, 9.06
317(a)(1)..................................................... 6.08
(a)(2)..................................................... 6.09
(b)........................................................ 2.04
318(a)........................................................ 14.01
(b)........................................................ N.A.
(c)........................................................ 14.01
N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.....................................................1
Section 1.02 Other Definitions..............................................35
Section 1.03 Incorporation by Reference of Trust Indenture Act..............36
Section 1.04 Rules of Construction..........................................36
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating................................................37
Section 2.02 Execution and Authentication...................................38
Section 2.03 Registrar, Paying Agent and Calculation Agent..................38
Section 2.04 Paying Agent to Hold Money in Trust............................39
Section 2.05 Holder Lists...................................................39
Section 2.06 Transfer and Exchange..........................................39
Section 2.07 Replacement Notes..............................................49
Section 2.08 Outstanding Notes..............................................49
Section 2.09 Treasury Notes.................................................50
Section 2.10 Temporary Notes................................................50
Section 2.11 Cancellation...................................................50
Section 2.12 Defaulted Interest.............................................50
Section 2.13 CUSIP Numbers..................................................50
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.............................................51
Section 3.02 Selection of Notes to Be Redeemed or Purchased.................51
Section 3.03 Notice of Redemption...........................................51
Section 3.04 Effect of Notice of Redemption.................................52
Section 3.05 Deposit of Redemption or Purchase Price........................52
Section 3.06 Notes Redeemed or Purchased in Part............................53
Section 3.07 Optional Redemption............................................53
Section 3.08 Mandatory Redemption...........................................55
Section 3.09 Offer to Purchase by Application of Excess Proceeds............55
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes...............................................57
Section 4.02 Maintenance of Office or Agency................................57
Section 4.03 Reports........................................................58
Section 4.04 Compliance Certificate.........................................59
Section 4.05 Taxes..........................................................59
Section 4.06 Stay, Extension and Usury Laws.................................59
Section 4.07 Restricted Payments............................................60
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Section 4.08 Dividend and Other Payment Restrictions Affecting
Subsidiaries...................................................64
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred
Stock..........................................................66
Section 4.10 Asset Sales....................................................70
Section 4.11 Transactions with Affiliates...................................72
Section 4.12 Liens..........................................................74
Section 4.13 Business Activities............................................74
Section 4.14 Corporate Existence............................................74
Section 4.15 Offer to Repurchase Upon Change of Control.....................74
Section 4.16 Limitation on Sale and Leaseback Transactions..................76
Section 4.17 Additional Note Guarantees.....................................76
Section 4.18 Designation of Restricted and Unrestricted
Subsidiaries...................................................76
Section 4.19 No Amendment to Subordination Provisions.......................76
Section 4.20 Payments for Consent...........................................77
Section 4.21 Changes in Covenants when Notes Rated Investment Grade.........77
Section 4.22 Further Assurances; Collateral Inspections and Reports;
Costs and Indemnification......................................78
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.......................79
Section 5.02 Successor Corporation Substituted..............................80
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default..............................................81
Section 6.02 Acceleration...................................................82
Section 6.03 Other Remedies.................................................83
Section 6.04 Waiver of Past Defaults........................................83
Section 6.05 Control by Majority............................................83
Section 6.06 Limitation on Suits............................................83
Section 6.07 Rights of Holders of Notes to Receive Payment..................84
Section 6.08 Collection Suit by Trustee.....................................84
Section 6.09 Trustee May File Proofs of Claim...............................84
Section 6.10 Priorities.....................................................85
Section 6.11 Undertaking for Costs..........................................85
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee..............................................85
Section 7.02 Rights of Trustee..............................................86
Section 7.03 Individual Rights of Trustee...................................87
Section 7.04 Trustee's Disclaimer...........................................87
Section 7.05 Notice of Defaults.............................................87
Section 7.06 Reports by Trustee to Holders of the Notes.....................87
Section 7.07 Compensation and Indemnity.....................................88
Section 7.08 Replacement of Trustee.........................................88
Section 7.09 Successor Trustee by Merger, etc...............................89
Section 7.10 Eligibility; Disqualification..................................89
Section 7.11 Preferential Collection of Claims Against Company..............90
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ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.......90
Section 8.02 Legal Defeasance and Discharge.................................90
Section 8.03 Covenant Defeasance............................................91
Section 8.04 Conditions to Legal or Covenant Defeasance.....................91
Section 8.05 Deposited Money and Government Securities to be Held
in Trust; Other Miscellaneous Provisions.......................92
Section 8.06 Repayment to the Company.......................................93
Section 8.07 Reinstatement..................................................93
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes............................93
Section 9.02 With Consent of Holders of Notes...............................94
Section 9.03 Compliance with Trust Indenture Act............................96
Section 9.04 Revocation and Effect of Consents..............................96
Section 9.05 Notation on or Exchange of Notes...............................96
Section 9.06 Trustee to Sign Amendments, etc................................97
ARTICLE 10.
NOTE GUARANTEES
Section 10.01 Guarantee......................................................97
Section 10.02 Limitation on Guarantor Liability..............................98
Section 10.03 Execution and Delivery of Note Guarantee.......................98
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms.............99
Section 10.05 Releases of Guarantees.........................................99
ARTICLE 11.
RANKING OF NOTE LIENS
Section 11.01 Agreement for the Benefit of Holders of Priority
and Parity Liens..............................................100
Section 11.02 Lien Sharing with Parity Liens................................101
Section 11.03 Amendment; Waiver.............................................103
Section 11.04 Notes, Note Guarantees and other Note Obligations
not Subordinated..............................................103
Section 11.05 NGL Assets....................................................103
ARTICLE 12.
COLLATERAL AND SECURITY
Section 12.01 Security Documents............................................104
Section 12.02 Collateral Trustee............................................104
Section 12.03 Authorization of Actions to Be Taken..........................105
Section 12.04 Release of Note Liens.........................................106
Section 12.05 Filing, Recording and Opinions................................107
Section 12.06 Compensation and Indemnity....................................108
ARTICLE 13.
SATISFACTION AND DISCHARGE
Section 13.01 Satisfaction and Discharge....................................109
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Section 13.02 Application of Trust Money....................................110
ARTICLE 14.
MISCELLANEOUS
Section 14.01 Trust Indenture Act Controls..................................110
Section 14.02 Notices.......................................................110
Section 14.03 Communication by Holders of Notes with Other Holders
of Notes......................................................111
Section 14.04 Certificate and Opinion as to Conditions Precedent............112
Section 14.05 Statements Required in Certificate or Opinion.................112
Section 14.06 Rules by Trustee and Agents...................................112
Section 14.07 No Personal Liability of Directors, Officers, Employees
and Stockholders..............................................112
Section 14.08 Governing Law.................................................113
Section 14.09 No Adverse Interpretation of Other Agreements.................113
Section 14.10 Successors....................................................113
Section 14.11 Severability..................................................113
Section 14.12 Counterpart Originals.........................................113
Section 14.13 Table of Contents, Headings, etc..............................113
SCHEDULES
Schedule I Guarantors
Schedule II Mortgages
EXHIBITS
Exhibit A1 FORM OF SERIES A NOTE
Exhibit A2 FORM OF SERIES B NOTE
Exhibit A3 FORM OF SERIES C NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF NOTE GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of August 11, 2003 among Dynegy Holdings Inc., a
Delaware corporation, the Guarantors (as defined), Wilmington Trust Company, as
trustee (the "Trustee") and Xxxxx Fargo Bank Minnesota, N.A., as collateral
trustee (the "Collateral Trustee").
The Company , the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders (as
defined) of the Second Priority Senior Secured Floating Rate Notes due 2008 (the
"Series A Notes"), the 9.875% Second Priority Senior Secured Notes due 2010 (the
"Series B Notes") and the 10.125% Second Priority Senior Secured Notes due 2013
(the "Series C Notes" and, together with the Series A Notes and the Series B
Notes, the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the form of the
applicable Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee that shall be issued in a denomination equal
to the outstanding principal amount of the Notes sold in reliance on Rule 144A.
"ACH Obligations" means any and all obligations of the Company or any of
its Subsidiaries owing to any lender under the Credit Agreement or any Affiliate
of any lender under the Credit Agreement under any treasury management services
agreement, any service terms or any service agreements, including electronic
payments service terms and/or automated clearing house agreements, and all
overdrafts on any account which the Company or any of its Subsidiaries maintains
with any lender under the Credit Agreement or any Affiliate of any lender under
the Credit Agreement.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified
Person, whether or not such Indebtedness is incurred in connection with, or
in contemplation of, such other Person merging with or into, or becoming a
Restricted Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Additional Notes" means an unlimited aggregate principal amount of Notes
(other than the Initial Notes) of any series issued under this Indenture in
accordance with Sections 2.02 and 4.09 hereof, as part of the same series, as
the case may be, as the Initial Notes.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person shall be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"Affiliate Guarantors" means:
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(1) Dynegy and BG Holdings, Inc., as the direct parent entities of
the Company; and
(2) Illinova and the following of its Restricted Subsidiaries:
Illinova Energy Partners, Inc.; Illinova Generating Company; IGC Xxxxxx
County, Inc.; IGC Xxxxxx Frontier, Inc.; IPG Ferndale, Inc.; IPG Paris,
Inc.; and Charter Oak (Paris), Inc., in each case, as Affiliates of the
Company, and their respective successors and assigns.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"Alpha Facility" means that certain Amended and Restated Performance
Agreement, effective as of March 27, 2001 (as amended and in effect from time to
time, the "Alpha Guaranty"), entered into by the Company in favor of ABG Gas
Supply, L.L.C. pursuant to which the Company guaranteed the obligations of (1)
DMT Supply LP under that certain Amended and Restated Natural Gas Purchase
Agreement dated as of March 27, 2001 and (2) Dynegy Marketing & Trade under that
certain Nomination Agreement dated as of March 27, 2001 each as amended,
related, modified, renewed, refunded, replaced (whether upon or after
termination or otherwise) or refinanced (including by means of sales of debt
securities to investors) in whole or in part from time to time (the Alpha
Guaranty and the documents referred to in clauses (1) and (2) are collectively
referred to as the "Alpha Facility").
"Applicable Eurodollar Rate" means, for each quarterly period during which
any Series A Note is outstanding subsequent to the initial quarterly period, 650
basis points over the rate determined by the Company (notice of such rate to be
sent to the Trustee by the Company on the date of determination thereof), equal
to the British Bankers' Association LIBOR rate for deposits in U.S. dollars for
a period of three months as reported by any generally recognized financial
information services as of 11:00 a.m. (London time) two Business Days
immediately prior to the first day of such quarterly period; provided that, if
no British Bankers' Association LIBOR rate is available to the Company, the
Applicable Eurodollar Rate for the relevant quarterly period shall instead be
the rate at which Credit Suisse First Boston LLC or one of its affiliate banks
offers to place deposits in U.S. dollars with first-class banks in the London
interbank market for a period of three months at approximately 11:00 a.m.
(London time) two Business Days immediately prior to the first day of such
quarterly period, in amounts equal to $1.0 million. The quarterly periods
referred to in this definition shall commence on January 15, April 15, July 15
and October 15 of each year; provided that the Applicable Eurodollar Rate for
the initial quarterly period commencing upon original issuance of the Series A
Notes shall be determined pursuant to this definition on the date that is two
Business Days immediately prior to the date of this Indenture. Notwithstanding
the foregoing, the Company may delegate the determination of the Applicable
Eurodollar Rate to any Calculation Agent pursuant to Section 2.03 hereof.
"Applicable Premium for Series A Notes" means, with respect to any Series A
Note on any redemption date, the greater of:
(1) 1.0% of the principal amount of the Note; or
(2) the excess of:
(a) the present value at such redemption date of (i) the redemption price
of the Note at July 15, 2006 set forth in Section 3.07(a)(3) plus (ii) all
required interest payments due on the Note through July 15, 2006 based on the
Applicable Eurodollar Rate then in effect, (excluding accrued but unpaid
interest to the redemption date) computed using a discount rate equal to the
Treasury Rate as of such redemption date plus 50 basis points; over
(b) the principal amount of the Note, if greater.
2
"Applicable Premium for Series B Notes" means, with respect to any Series B
Note on any redemption date, the greater of:
(1) 1.0% of the principal amount of the Note; or
(2) the excess of:
(a) the present value at such redemption date of (i) the redemption price
of the Note at July 15, 2007 set forth in Section 3.07(b)(3) plus (ii) all
required interest payments due on the Note through July 15, 2007 (excluding
accrued but unpaid interest to the redemption date) computed using a discount
rate equal to the Treasury Rate as of such redemption date plus 50 basis points;
over
(b) the principal amount of the note, if greater.
"Applicable Premium for Series C Notes" means, with respect to any Series C
Note on any redemption date, the greater of:
(1) 1.0% of the principal amount of the Note; or
(2) the excess of:
(a) the present value at such redemption date of (i) the redemption price
of the Note at July 15, 2008 set forth in Section 3.07 (c)(3) plus (ii) all
required interest payments due on the Note through July 15, 2008 (excluding
accrued but unpaid interest to the redemption date) computed using a discount
rate equal to the Treasury Rate as of such redemption date plus 50 basis points;
over
(b) the principal amount of the Note, if greater.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depositary, Euroclear and Clearstream that apply to such transfer or exchange.
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any assets or
rights; provided that the sale, conveyance or other disposition of all or
substantially all of the assets of the Company and its Restricted
Subsidiaries taken as a whole shall be governed by Section 4.15 and/or
Section 5.01 hereof; and
(2) the issuance of Equity Interests in any of the Company's
Restricted Subsidiaries or the sale of Equity Interests in any of its
Subsidiaries.
Notwithstanding the preceding, none of the following items shall be deemed to be
an Asset Sale:
(1) any single transaction or series of related transactions that
involves assets having a Fair Market Value of less than $20.0 million;
(2) a transfer of assets between or among the Company and any of its
Restricted Subsidiaries,
3
(3) an issuance of Equity Interests by a Restricted Subsidiary of the
Company to the Company or to a Restricted Subsidiary of the Company
(including any Person that becomes a Restricted Subsidiary of the Company
in connection with such transaction);
(4) (a) the sale or lease of products, services or accounts
receivable in the ordinary course of business, (b) any sale or other
disposition of surplus, damaged, worn-out or obsolete assets or property
(including, without limitation, inventory, immaterial assets and property
no longer commercially viable to maintain and operate) in the ordinary
course of business and (c) the granting of any option or other right to
purchase, or otherwise acquire property in the ordinary course of business;
(5) the sale or disposition by Dynegy and its Restricted Subsidiaries
of assets in connection with (a) the termination, amendment or
restructuring of any tolling agreement and (b) dispositions of property in
connection with settlement of any Litigation, in the case of both clause
(a) and (b), for reasonably equivalent value, as determined by Dynegy or
such Restricted Subsidiary;
(6) the sale or disposition by Dynegy and its Restricted Subsidiaries
of assets in connection with any Discontinued Business Operations of Dynegy
and its Restricted Subsidiaries so long as such disposition is for
reasonably equivalent value, as determined by Dynegy or such Restricted
Subsidiary;
(7) sales or dispositions resulting from the bona fide exercise by a
governmental authority of its claimed or actual power of eminent domain or
dispositions otherwise required by applicable law that would not materially
adversely effect Dynegy and its Restricted Subsidiaries, taken as a whole;
(8) dispositions of property subject to a Permitted Lien that is
transferred to the lienholder or its designee in satisfaction or settlement
of such lienholder's claim or a realization upon any Lien permitted
pursuant to this Indenture;
(9) the sale or other disposition of cash or Cash Equivalents; and
(10) a Restricted Payment that does not violate Section 4.07 hereof or
a Permitted Investment.
"Attributable Debt" in respect of a Sale and Leaseback Transaction means,
at the time of determination, the present value of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
Sale and Leaseback Transaction including any period for which such lease has
been extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of interest
implicit in such transaction, determined in accordance with GAAP; provided,
however, that if such Sale and Leaseback Transaction results in a Capital Lease
Obligation, the amount of Indebtedness represented thereby shall be determined
in accordance with the definition of "Capital Lease Obligation."
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial
4
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only after the passage of time. The terms
"Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of the
corporation or any committee thereof duly authorized to act on behalf of
such board;
(2) with respect to a partnership, the board of directors of the
general partner of the partnership;
(3) with respect to a limited liability company, the managing member
or members or any controlling committee of managing members thereof; and
(4) with respect to any other Person, the board or committee of such
Person serving a similar function.
"Board Resolution" means a resolution duly adopted by the Company's Board
of Directors, a copy of which, certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Company's Board of
Directors and to be in full force and effect on the date of such certification,
shall have been delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination is to be
made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP, and the Stated Maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be prepaid by the lessee without payment of a penalty.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership interests (whether general or limited) or membership interests;
and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person, but excluding from all of the foregoing any
debt securities convertible into Capital Stock, whether or not such debt
securities include any right of participation with Capital Stock.
"Cash Collateral Account" means a deposit account at all times under the
sole dominion and control of the Collateral Trustee (acting on its own or
through its agent) that is being held by the Collateral Trustee or such agent
for the benefit of the holders of Secured Debt.
"Cash Equivalents" means:
5
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality of the United
States government (provided that the full faith and credit of the United
States is pledged in support of those securities) having maturities of not
more than one year from the date of acquisition;
(3) certificates of deposit, demand deposits, and eurodollar time
deposits with maturities of one year or less from the date of acquisition,
bankers' acceptances with maturities not exceeding one year and overnight
bank deposits, in each case, with any lender party to the Credit Agreement
or with any domestic commercial bank having capital and surplus in excess
of $500.0 million and a Thomson Bank Watch Rating of "B" or better;
(4) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clauses (2) and (3)
above entered into with any financial institution meeting the
qualifications specified in clause (3) above;
(5) commercial paper having one of the two highest ratings obtainable
from Xxxxx'x Investors Service, Inc. or Standard & Poor's Rating Services
and in each case maturing within one year after the date of acquisition;
and
(6) money market funds at least 95% of the assets of which constitute
Cash Equivalents of the kinds described in clauses (1) through (5) of this
definition.
"Clearstream" means Clearstream Banking, S.A.
"Change of Control" means the occurrence of any of the following:
(1) the direct or indirect sale, transfer, conveyance or other
disposition (other than by way of merger or consolidation), in one or a
series of related transactions, of all or substantially all of the
properties or assets of Dynegy and its Restricted Subsidiaries, taken as a
whole, to any "person" (as that term is used in Section 13(d) of the
Exchange Act) other than Chevron or a Related Party of Chevron;
(2) the adoption of a plan relating to the liquidation or dissolution
of Dynegy or the Company other than (a) the consolidation with, merger into
or transfer of all or part of the properties and assets of any Restricted
Subsidiary of Dynegy to Dynegy, (b) the consolidation with, merger into or
transfer of all or part of the properties and assets of any Restricted
Subsidiary of the Company to the Company and (c) the merger of Dynegy with
an Affiliate solely for the purpose of reincorporating Dynegy or reforming
Dynegy in another jurisdiction or (d) the merger of the Company with an
Affiliate solely for the purpose of reincorporating the Company or
reforming the Company in another jurisdiction;
(3) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is that any
"person" (as defined above), other than Chevron and its Related Parties,
becomes the Beneficial Owner, directly or indirectly, of more than 50% of
the Voting Stock of Dynegy, measured by voting power rather than number of
shares;
(4) Dynegy consolidates with, or merges with or into, any Person
other than Chevron or a Related Party of Chevron, or any Person other than
Chevron or a Related Party of Chevron consolidates with, or merges with or
into, Dynegy, in any such event pursuant to a transaction in
6
which any of the outstanding Voting Stock of Dynegy or such other Person
other than Chevron or a Related Party of Chevron is converted into or
exchanged for cash, securities or other property, other than any such
transaction where the Voting Stock of Dynegy outstanding immediately prior
to such transaction is converted into or exchanged for Voting Stock (other
than Disqualified Stock) of the surviving or transferee Person constituting
a majority of the outstanding shares of such Voting Stock of such surviving
or transferee Person (immediately after giving effect to such issuance); or
(5) the first day on which Dynegy ceases to own, directly or
indirectly, 100% of the outstanding Equity Interests of the Company.
"Chevron" means Chevron U.S.A., Inc., a Pennsylvania corporation.
"CoGen Lyondell Facility" means that certain Participation Agreement, dated
August 7, 2000, among CoGen Lyondell, Inc. as the lessee, the Company, as
guarantor, Operating Lessor Limited Company, as the lessor, Four Winds Funding
Corp., as tranche A lender, tranche B lender and conduit, the certificate
holders and the liquidity banks party thereto, and Commerzbank AG, New York
Branch, as administrative agent and lease arranger, together with the operative
documents referred to therein, as amended, restated, modified, renewed,
refunded, replaced (whether upon or after termination or otherwise) or
refinanced (including by means of sales of debt securities to investors) in
whole or in part from time to time.
"Collateral" has the meaning assigned to it in the Security Documents.
"Collateral Trustee" means (i) the party named as such in the preamble to
this Indenture until a successor replaces it in accordance with Article 12 of
this Indenture and thereafter means the successor serving hereunder, in such
Person's capacity as the holder of Liens granted to it pursuant to the Security
Documents and any successor in such capacity and (ii) after transfer of the Note
Liens to the Joint Collateral Agent pursuant to Section 12.02, the Joint
Collateral Agent.
"Company" means Dynegy Holdings Inc. and any and all successors thereto.
"Consolidated Cash Flow" means, with respect to any specified Person for
any period, the Consolidated Net Income of such Person for such period plus,
without duplication:
(1) an amount equal to any extraordinary loss plus any net loss
realized by such Person or any of its Restricted Subsidiaries in connection
with (a) an Asset Sale, (b) the disposition of any securities by such
Person or any of its Restricted Subsidiaries or (c) the extinguishment of
any Indebtedness of such Person or any of its Restricted Subsidiaries, in
each case to the extent such losses were deducted in computing such
Consolidated Net Income; plus
(2) provision for taxes based on income or profits of such Person and
its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was deducted in computing such Consolidated Net Income;
plus
(3) the Fixed Charges of such Person and its Restricted Subsidiaries
for such period, to the extent that such Fixed Charges were deducted in
computing such Consolidated Net Income; plus
(4) depreciation, amortization (including amortization of intangibles
but excluding amortization of prepaid cash expenses that were paid in a
prior period) and other non-cash
7
expenses (excluding any such non-cash expense to the extent that it
represents an accrual of or reserve for cash expenses in any future period
or amortization of a prepaid cash expense that was paid in a prior period)
of such Person and its Restricted Subsidiaries for such period to the
extent that such depreciation, amortization and other non-cash expenses
were deducted in computing such Consolidated Net Income; plus
(5) charges associated with fees and expenses, including professional
fees, incurred prior to the date of this Indenture in connection with the
modification or preparation in connection therewith of Indebtedness of the
Company that occurred prior to the date of this Indenture, to the extent
such charges were deducted in computing Consolidated Net Income; plus
(6) the upfront costs of any Hedging Obligations paid prior to the
date of this Indenture, to the extent such costs were deducted in computing
Consolidated Net Income; minus
(7) non-cash items (including, without limitation, the gains realized
upon the repurchase and retirement of any Indebtedness of such Person or
any of its Restricted Subsidiaries), increasing such Consolidated Net
Income for such period, other than an accrual of revenue or the reversal of
an accrued expense, in each case in the ordinary course of business;
in each case, on a consolidated basis and determined in accordance with GAAP.
"Consolidated Net Assets" means total assets minus total liabilities, in
each case as reported on the consolidated balance sheet of the Company prepared
in accordance with GAAP for the most recent fiscal quarter for which financial
statements are publicly available.
"Consolidated Net Income" means, with respect to any specified Person for
any period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:
(1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends
or similar distributions (including intercompany payments) paid in cash to
the specified Person or a Restricted Subsidiary of the Person;
(2) the Net Income of any Restricted Subsidiary shall be excluded to
the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at
the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of
the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders; provided that Net Income shall
not be excluded pursuant to this clause (2) solely by reason of a
restriction contained in any of the Subsidiary Facilities as the same are
in effect on the date of this Indenture;
(3) the cumulative effect of a change in accounting principles shall
be excluded;
(4) cash received or paid during such period related to
xxxx-to-market activities shall be included, but all non-xxxx
xxxx-to-market earnings or losses shall be excluded; and
(5) any losses realized by the Company or any of its Restricted
Subsidiaries resulting from the settlement of any tolling and related
agreements to which the Company or any of its Restricted Subsidiaries is a
party as of the date of this Indenture shall be excluded, and the losses
8
or gains recognized with respect to settled tolling and related agreements
during the twelve-month period immediately preceding the settlement of such
tolling and related agreements also shall be excluded; provided that with
respect to any tolling and related agreements accounted for by using
xxxx-to-market, losses and gains shall be measured in terms of cash paid or
received pursuant to clause (4) of this definition.
"Convertible Debentures" means up to $225.0 million in aggregate principal
amount of the 4.75% Convertible Subordinated Debentures due 2023 of Dynegy that
may be issued concurrently with, or within 30 days following, the issuance of
the Initial Notes.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 14.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Agreement" means that certain Credit Agreement, dated as of April
1, 2003, by and among the Company, as Borrower, Dynegy, as Parent Guarantor, the
other guarantors thereunder and Citibank, N.A. and Bank of America, N.A., as
Administrative Agents and the other lenders thereunder, providing for up to
$1,100.0 million of revolving credit, $200.0 million of Term A Loan borrowings
(all of which shall be repaid with the net proceeds of the Initial Notes), and
$360.0 million of Term B Loan borrowings (all or a portion of which may be
repaid with the net proceeds of the Initial Notes), including any related notes,
guarantees, collateral documents, instruments and agreements executed in
connection therewith, and in each case as amended, restated, modified, renewed,
refunded, replaced (whether upon or after termination or otherwise) or
refinanced (including by means of sales of debt securities to investors) in
whole or in part from time to time.
"Credit Agreement Agent" means at any time, the Person serving at such time
as the "Agent" or "Administrative Agent" under the Credit Agreement or any other
representative of the lenders then most recently designated by a majority of the
lenders, in a written notice delivered to the Trustee and the Collateral
Trustee, as the Credit Agreement Agent for the purposes of this Indenture.
"Credit Facilities" means one or more debt facilities (including, without
limitation, the Credit Agreement), commercial paper facilities, margin account
facilities or overdraft facilities, in each case with banks or other lenders
providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables), lines of
credit, margin accounts, overdraft lines or letters of credit, in each case, as
amended, restated, modified, renewed, refunded, replaced, restructured or
refinanced (including increasing the amount of available borrowings thereunder
and also including by means of sales of debt securities to investors) in whole
or in part from time to time.
"CUSIP" means a security identification number applicable to any of the
Global Notes (or beneficial interests therein) that identifies the series of
such Notes (including any subdivisions thereof in recognition of restrictions
that may be applicable to such Notes), determined in accordance with numbering
system established by the Committee on Uniform Security Identification
Procedures and as administered by S&P.
"Custodian" means the Trustee, as custodian with respect to the Notes in
global form, or any successor entity thereto.
"Default" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
9
"Definitive Note" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of the applicable Exhibit A hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in whole
or in part in global form, the Person specified in Section 2.03 hereof as the
Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Discharge of Parity Lien Debt" means termination of all commitments to
extend credit or purchase debt securities that would constitute Parity Lien Debt
and payment in full in cash of the principal of and interest and premium (if
any) on all Parity Lien Debt and all other Parity Lien Obligations that are due
and payable at the time the Parity Lien Debt is paid in full in cash.
"Discontinued Business Operations" means, with respect to any Person, the
results of operations and any charges, fees, penalties, costs or impairments
associated with (a) lines of business or assets that were wound down,
discontinued or disposed of, or were under contract to be disposed of by such
Person or any of its Subsidiaries, including (to the extent applicable to such
Person) those associated with Dynegy Global Liquids, Inc., Northern Natural Gas
Company, NNGC Holding Company, Inc., MCTJ Holding Co. LLC, Dynegy Onshore
Processing UK Limited, Dynegy Storage Limited, Dynegy Offshore UK Limited,
Dynegy Canada Gas Marketing Ltd. and Dynegy Global Communications, Inc. and
their respective Subsidiaries, (b) lines of business or assets that are wound
down, discontinued or disposed of in connection with the customer risk
management business segment, third party risk management transactions or those
(to the extent applicable to such Person) associated with Dynegy Global
Communications and its respective Subsidiaries or (c) any tolling agreement,
including the termination, disposal or restructuring thereof.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
issuer thereof to repurchase such Capital Stock upon the occurrence of a change
of control or an asset sale shall not constitute Disqualified Stock if the terms
of such Capital Stock provide that the issuer thereof may not repurchase or
redeem any such Capital Stock pursuant to such provisions unless either (1) such
repurchase or redemption complies with Section 4.07 hereof or (2) the issuer of
such Capital Stock, to the extent required, has first complied with Section 4.10
hereof or Section 4.15 hereof. The amount of Disqualified Stock deemed to be
outstanding at any time for purposes of this Indenture shall be the maximum
amount that the Company and its Restricted Subsidiaries may become obligated to
pay upon the maturity of, or pursuant to any mandatory redemption provisions of,
such Disqualified Stock, exclusive of accrued dividends.
"DNE Guarantees" means (a) the Guaranty dated as of May 1, 2001 made by the
Company in respect of certain obligations of Dynegy Danskammer, L.L.C. and (b)
the Guaranty dated as of May 1, 2001 made by the Company in respect of certain
obligations of Dynegy Roseton, L.L.C.
10
"Domestic Subsidiary" means any Subsidiary of any Person that was formed
under the laws of the United States or any state of the United States or the
District of Columbia or that guarantees or otherwise provides direct credit
support for any other Indebtedness of such Person.
"DYN Notes" means $225.0 million in aggregate principal amount of Dynegy's
Junior Subordinated Notes due 2016 together with any additional DYN Notes issued
from time to time as payable-in-kind interest thereon.
"DYN Preferred" means Dynegy's Series C Convertible Preferred Stock issued
in connection with the Series B Restructuring Transaction, substantially on the
terms set forth in the Exchange Agreement dated July 28, 2003 between Dynegy and
Chevron, as amended, modified or replaced on terms no less favorable to the
Holders of the Notes.
"Dynegy" means Dynegy Inc., an Illinois corporation, together with its
successors and permitted assigns hereunder, which owns, directly or indirectly,
100% of the Capital Stock of each of the Company and Illinova.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the Euroclear
system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Assets" means:
(1) any Collateral constituting property that is the subject of or
relating to any contract, agreement or other document to which any
Guarantor is a party on the date of this Indenture or any similar contract,
agreement or other document entered into by such Guarantor after the date
of this Indenture shall, in each case, be excluded from the Lien created by
such Guarantor under the Security Documents to the extent (but only to the
extent) that the assignment thereof, or the creation of a Lien thereon,
would constitute a breach of the terms of such contract, agreement or other
document, or would cause a default or event of default under the terms of
such contract, agreement or other document, or would permit any party to
such contract, agreement or other document to terminate any material
contract right arising under any such contract agreement or other document
or to exercise any put, call, right of refusal, purchase option or other
similar right, or would permit any party to such contract, agreement or
other document to terminate such contract, agreement or other document;
provided, however, that any such Collateral shall automatically cease to be
excluded at such time as (x) the prohibition of assignment or of the
creation of a Lien with respect to such Collateral is no longer in effect
or is rendered ineffective as a matter of law or (y) the applicable
Guarantor has obtained the consent of the other parties to such agreement
to the assignment of, or creation of a Lien with respect to, such
Collateral (which consent such Guarantor shall not be required to obtain
hereunder, except upon a request of the Collateral Trustee after the
occurrence and during the continuance of an event of default under this
Indenture) or (z) the breach, default, event of default or any other
conditions otherwise giving rise to the exclusion of such property under
this clause (1) shall cease to exist;
(2) any contract, agreement or other document (and any contract
rights arising thereunder) to which any of the Guarantors is a party on the
date of this Indenture and any similar contract or agreement entered into
by any Guarantor after the date of this Indenture, in each case, shall be
excluded from the Lien granted by such Guarantor under the Security
Documents to the
11
extent (but only to the extent) that the assignment thereof, or the
creation of a Lien thereon, would constitute a breach of the terms of such
contract, agreement or other document to which any of the Guarantors may
now or hereafter be a party or to which any Guarantor may now or hereafter
be subject, or would cause a default or event of default under the terms of
such contract, agreement or other document, or would permit any party to
such contract, agreement or other document to terminate any material
contract right arising under any such contract agreement or other document
or to exercise any put, call, right of refusal, purchase option or other
similar right, or would permit any party to such contract, agreement or
other document to terminate such contract, agreement or other document (all
such contracts, agreements and other documents being the "Excluded
Agreements"); provided, however, that (x) except as set forth in clause (4)
below, the exclusion from the Lien granted by such Guarantor hereunder of
any contract rights of any of the Guarantors under one or more of the
Excluded Agreements shall not limit, restrict or impair the grant by such
Guarantor of the Lien on any accounts or receivables arising under any such
Excluded Agreement or any payments due or to become due thereunder, and (y)
any of the Excluded Agreements shall automatically cease to be excluded at
such time as, (A) the prohibition of assignment or of the creation of a
Lien with respect to such agreement is no longer in effect or is rendered
ineffective as a matter of law or (B) the applicable Guarantor has obtained
the consent of the other parties to such agreement to the assignment of, or
creation of a Lien with respect to, the contract rights of such Guarantor
thereunder (which consent such Guarantor shall not be required to obtain
hereunder, except upon a request of the Collateral Trustee after the
occurrence and during the continuance of an event of default under this
Indenture);
(3) any license, permit or authorization from any governmental
authority in favor of any Guarantor shall be excluded from the Lien granted
by such Guarantor under the Security Documents to the extent (but only to
the extent) that the assignment thereof or the creation of a Lien thereon
would constitute a breach of or a default or event of default under the
terms of such license, permit or authorization or would require any
separate license, permit or authorization or would otherwise terminate such
license, permit or authorization (all of the licenses, permits and
authorizations referred to herein being the "Excluded Authorizations");
provided, however, that any of the Excluded Authorizations shall cease to
be excluded at such time as (x) the prohibition of assignment or of the
creation of a Lien with respect to such license, permit or authorization is
no longer in effect or is rendered ineffective as a matter of law or (y)
the applicable Guarantor has obtained the consent of the applicable
governmental authority to the assignment of, or creation of a Lien with
respect to, such license, permit or authorization of such Guarantor (which
consent such Guarantor shall not be required to obtain hereunder, except
upon a request of the Collateral Trustee after the occurrence and during
the continuance of an Event of Default under this Indenture);
(4) any Permitted Collateral of any Guarantor from time to time
pledged, assigned, conveyed or transferred, or against which any right of
set-off is granted or in which a Lien is granted, by such Guarantor under
any Permitted Contracts or Netting Agreements shall be excluded from the
Lien granted by such Guarantor under the Security Documents; to the extent
any such Lien is deemed to be granted pursuant to this Agreement in such
Permitted Collateral hereunder notwithstanding the exclusion contemplated
hereby, such Lien shall ipso facto immediately and automatically terminate,
without any further action by any Person, upon any such pledge, assignment,
conveyance, transfer, grant of such right of set-off or grant of such Lien,
provided, however, that any such Permitted Collateral shall cease to be
excluded at such time as (x) the Permitted Contracts or Netting Agreements,
as the case may be, related thereto is terminated and the setoff rights,
Lien granted in such Permitted Collateral are terminated or (y) the
applicable Guarantor has obtained the consent of the applicable
counterparty to such Permitted Contracts or Netting Agreements to the
assignment of, or creation of a Lien in such
12
Permitted Collateral hereunder (which consent such Guarantor shall not be
required to obtain hereunder, except upon a request of the Collateral
Trustees after the occurrence and during the continuance of an Event of
Default under this Indenture);
(5) as to each Guarantor, any outstanding voting stock of any entity
that is a controlled foreign corporation under Section 957 of the Internal
Revenue Code (or any successor provision thereto), except for voting stock
consisting of no more than 66% of the outstanding voting stock of such
entity ("Excluded Equity");
(6) any property or accounts (including without limitation, coal,
power, energy, other energy related products, natural gas, natural gas
liquids, condensate, and sulfur, and including any other products resulting
from generating, gas gathering, processing, fractionating and refining,
marketed by any Guarantor on behalf of third parties and the proceeds
derived therefrom pursuant to processing agreements and/or marketing
arrangements), to the extent (but only to the extent) that any Guarantor
manages, maintains or markets such property on behalf of a third party,
including, without limitation, any Collateral maintained, managed or
marketed by any Guarantor for a joint venture in which third parties
participate or on behalf of third parties;
(7) any policy of insurance, provided, however, that proceeds of
insurance shall be included as Collateral to the extent the Lien granted
hereby in the goods covered by such insurance would continue in accordance
with Section 9-315 of the UCC; and
(8) the shares of Capital Stock or such other Equity Interests of (a)
Illinois Power and Dynegy Global Communications, Inc. and their respective
subsidiaries, (b) non-Domestic Subsidiaries and Immaterial Subsidiaries and
(c) Subsidiaries whose ownership interests may not be pledged due to
existing contractual or legal restrictions;
provided, however, that any proceeds received by any Guarantor from the sale,
transfer or other disposition of Excluded Assets, Excluded Authorizations,
Excluded Agreements, Excluded Equity and any other property excluded under
clauses (1) through (8) above shall constitute Collateral unless any assets or
property constituting such proceeds are themselves subject to the exclusions set
forth in clauses (1) through (8) above.
"Existing Indebtedness" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Credit Agreement and the
Subsidiary Facilities) in existence on the date of this Indenture, until such
amounts are repaid (other than repayment in connection with the incurrence of
Permitted Refinancing Indebtedness with respect thereto).
"Fair Market Value" means the value that would be paid by a willing buyer
to an unaffiliated willing seller in a transaction not involving distress or
necessity of either party, determined in good faith by the chief financial
officer or Board of Directors of the Person required to make such determination
(unless otherwise provided in this Indenture).
"Fixed Charge Coverage Ratio" means with respect to any specified Person
for any period, the ratio of the Consolidated Cash Flow of such Person and its
Restricted Subsidiaries for such period to the Fixed Charges of such Person for
such period. In the event that the specified Person or any of its Restricted
Subsidiaries incurs, assumes, Guarantees, repays, repurchases, redeems, defeases
or otherwise discharges any Indebtedness (other than ordinary working capital
borrowings) or issues, repurchases or redeems preferred stock subsequent to the
commencement of the period for which the Fixed Charge Coverage Ratio is being
calculated and on or prior to the date on which the event for which the
calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Fixed Charge
13
Coverage Ratio shall be calculated giving pro forma effect to such incurrence,
assumption, Guarantee, repayment, repurchase, redemption, defeasance or other
discharge of Indebtedness, or such issuance, repurchase or redemption of
preferred stock, and the use of the proceeds therefrom, as if the same had
occurred at the beginning of the applicable four-quarter reference period. In
addition, for purposes of calculating the Fixed Charge Coverage Ratio:
(1) acquisitions that have been made by the specified Person or any
of its Restricted Subsidiaries, including through mergers or
consolidations, or any Person or any of its Restricted Subsidiaries
acquired by the specified Person or any of its Restricted Subsidiaries, and
including any related financing transactions and including increases in
ownership of Restricted Subsidiaries, during the four-quarter reference
period or subsequent to such reference period and on or prior to the
Calculation Date shall be given pro forma effect (in accordance with
Regulation S-X under the Securities Act) as if they had occurred on the
first day of the four-quarter reference period and Consolidated Cash Flow
for such reference period shall be calculated on a pro forma basis;
(2) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, and operations or
businesses (and ownership interests therein) disposed of prior to the
Calculation Date, shall be excluded;
(3) the Fixed Charges attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses (and
ownership interests therein) disposed of prior to the Calculation Date,
shall be excluded, but only to the extent that the obligations giving rise
to such Fixed Charges shall not be obligations of the specified Person or
any of its Restricted Subsidiaries following the Calculation Date;
(4) any Person that is a Restricted Subsidiary on the Calculation
Date shall be deemed to have been a Restricted Subsidiary at all times
during such four-quarter period;
(5) any Person that is not a Restricted Subsidiary on the Calculation
Date shall be deemed not to have been a Restricted Subsidiary at any time
during such four-quarter period; and
(6) if any Indebtedness bears a floating rate of interest, the
interest expense on such Indebtedness shall be calculated as if the rate in
effect on the Calculation Date had been the applicable rate for the entire
period (taking into account any Hedging Obligation applicable to such
Indebtedness if such Hedging Obligation has a remaining term as at the
Calculation Date in excess of 12 months).
For purposes of this definition, whenever pro forma effect is to be given to an
acquisition or investment, the amount of income or earnings relating thereto and
the amount of Fixed Charges associated with any Indebtedness incurred in
connection therewith, the pro forma calculations shall be determined in good
faith by a responsible financial or accounting Officer of the Company. Any such
pro forma calculations may include operating expense reductions for such period
resulting from the acquisition which is being given pro forma effect that would
be permitted pursuant to Article 11 of Regulation S-X under the Securities Act.
"Fixed Charges" means, with respect to any specified Person for any period,
the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued,
including, without limitation, amortization of debt issuance
14
costs (but excluding (a) amortization of debt issuance costs related to
Indebtedness and (b) charges associated with fees and expenses, including
professional fees, in connection with the modification of any Indebtedness
of the Company or any of its Restricted Subsidiaries, in each case incurred
on or prior to the date of this Indenture) and original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings,
and net of the effect of all payments made or received pursuant to Hedging
Obligations in respect of interest rates; plus
(2) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period; plus
(3) any interest accruing on Indebtedness of another Person that is
Guaranteed by such Person or one of its Restricted Subsidiaries or secured
by a Lien on assets of such Person or one of its Restricted Subsidiaries,
whether or not such Guarantee or Lien is called upon; plus
(4) the product of (A) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred stock of such Person or
any of its Restricted Subsidiaries, other than dividends on Equity
Interests payable solely in Equity Interests of the Company (other than
Disqualified Stock) or to the Company or a Restricted Subsidiary of the
Company, times (B) (x) in the case of trust preferred dividend payments,
one and (y) in the case of all other preferred dividend payments, a
fraction, the numerator of which is one and the denominator of which is one
minus the then current combined federal, state and local statutory tax rate
of such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP; minus
(5) the upfront costs of any Hedging Obligations paid prior to the
date of this Indenture.
"GAAP" means generally accepted accounting principles 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 have been approved by a significant segment of the accounting
profession, which are in effect from time to time.
"Global Notes" means, individually and collectively, each of the Restricted
Global Notes and the Unrestricted Global Notes, substantially in the form of the
applicable Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4) or 2.06(d)(2) hereof.
"Global Note Legend" means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services, to take or pay or to maintain financial statement
conditions or otherwise).
15
"Guarantors" means the Subsidiary Guarantors and the Affiliate Guarantors.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:
(1) interest rate swap agreements (whether from fixed to floating or
from floating to fixed), interest rate cap agreements and interest rate
collar agreements;
(2) other agreements or arrangements designed to manage interest
rates or interest rate risk; and
(3) other agreements or arrangements designed to protect such Person
against fluctuations in currency exchange rates or commodity prices.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a Global Note substantially in the form of the
applicable Exhibit A hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee that shall be issued in a denomination equal to
the outstanding principal amount of the Notes sold or resold to Institutional
Accredited Investors.
"Illinois Power" means Illinois Power Company, an Illinois corporation and
wholly-owned Subsidiary of Illinova, together with its successors and permitted
assigns hereunder.
"Illinova" means Illinova Corporation, an Illinois corporation and
wholly-owned Subsidiary of Dynegy, together with its successors and permitted
assigns hereunder.
"Illinova Asset Sale" means an Asset Sale of the Capital Stock of, or all
or substantially all of the assets of, Illinova or Illinois Power.
"Illinova Senior Notes" means the 7 1/8% senior notes due 2004 issued by
Illinova under that certain indenture dated as of February 1, 1997 between
Illinova and the First National Bank of Chicago, as trustee, issued in an
aggregate principal amount of $100 million.
"Immaterial Subsidiary" means, as of any date, any Restricted Subsidiary
whose total assets, as of that date, are less than $100,000 and whose total
revenues for the most recent 12-month period do not exceed $100,000; provided,
that a Restricted Subsidiary will not be considered to be an Immaterial
Subsidiary if it, directly or indirectly, guarantees or otherwise provides
direct credit support for any other Indebtedness of the Company.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person (excluding accrued expenses and trade payables),
whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations or Attributable Debt in
respect of Sale and Leaseback Transactions;
16
(5) representing the balance deferred and unpaid of the purchase
price of any property or services due more than six months after such
property is acquired or such services are completed; or
(6) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit,
Attributable Debt and Hedging Obligations) would appear as a liability upon a
balance sheet of the specified Person prepared in accordance with GAAP. In
addition, the term "Indebtedness" includes all Indebtedness of others secured by
a Lien on any asset of the specified Person (whether or not such Indebtedness is
assumed by the specified Person) and, to the extent not otherwise included, the
Guarantee by the specified Person of any Indebtedness of any other Person.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Initial Notes" means the first $225.0 million in aggregate principal
amount of Series A Notes, first $525.0 million in aggregate principal amount of
Series B Notes and first $700.0 million in aggregate principal amount of Series
C Notes, in each case issued under this Indenture on the date hereof.
"Initial Purchasers" means Credit Suisse First Boston LLC, Banc of America
Securities LLC, Citigroup Global Markets Inc., Xxxxxx Brothers Inc., X.X.Xxxxxx
Securities Inc., Xxxxxx Xxxxxxx & Co. Incorporated, ABN AMRO Incorporated, Banc
One Capital Markets, Inc., Credit Lyonnais Securities (USA) Inc., Deutsche Bank
Securities Inc., XX Xxxxx Securities Corporation and TD Securities (USA) Inc.
"Insolvency or Liquidation Proceeding" means:
(1) any case commenced by or against the Company or any other Obligor
under any Bankruptcy Law, any other proceeding for the reorganization,
recapitalization or adjustment or marshalling of the assets or liabilities
of the Company or any other Obligor, any receivership or assignment for the
benefit of creditors relating to the Company or any other Obligor or any
similar case or proceeding relative to the Company or any other Obligor or
its creditors, as such, in each case whether or not voluntary;
(2) any liquidation, dissolution, marshalling of assets or
liabilities or other winding up of or relating to the Company or any other
Obligor, in each case whether or not voluntary and whether or not involving
bankruptcy or insolvency; or
(3) any other proceeding of any type or nature in which substantially
all claims of creditors of the Company or any other Obligor are determined
and any payment or distribution is or may be made on account of such
claims.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Intercreditor Agreement" means that certain agreement dated as of August
11, 2003 among Wilmington Trust Company, as First Priority Corporate Trustee,
Xxxx X. Xxxxxx, Xx., as First Priority Individual Trustee, Bank One, NA (Main
Office Chicago), as First Priority Collateral Agent, Xxxxx Fargo
17
Bank Minnesota, N.A., as Second Priority Collateral Trustee, Dynegy Holdings
Inc. as a Grantor and other parties referred to therein as Grantors.
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding payroll, commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or Illinova or any of their respective Subsidiaries sells or otherwise disposes
of any Equity Interests of any direct or indirect Subsidiary of the Company or
Illinova, such that, after giving effect to any such sale or disposition, such
Person is no longer a Subsidiary of the Company or Illinova, as the case may be,
then the Company or Illinova shall be deemed to have made an Investment on the
date of any such sale or disposition equal to the Fair Market Value of the
Company's or Illinova's Investments in such Subsidiary that were not sold or
disposed of in an amount determined as provided in the final paragraph of
Section 4.07(b) hereof. The acquisition by the Company or Illinova or any of
their respective Subsidiaries of a Person that holds an Investment in a third
Person shall be deemed to be an Investment by the Company, Illinova or such
Subsidiary in such third Person in an amount equal to the Fair Market Value of
the Investments held by the acquired Person in such third Person in an amount
determined as provided in the final paragraph of Section 4.07(b) hereof. Except
as otherwise provided in this Indenture, the amount of an Investment shall be
its Fair Market Value at the time the Investment is made and without giving
effect to subsequent changes in value.
"IP Intercompany Note" means that certain promissory note, of approximately
$2,262.1 million in principal amount, dated as of September 30, 2000, made by
Dynegy to Illinova, as payee, as in effect on the date of this Indenture as
renewed, refunded, replaced, restructured or refinanced; provided that such note
is between Dynegy and Illinova at all times.
"Joint Collateral Agent" means a bank or trust company that:
(1) is authorized to exercise corporate trust powers;
(2) is reasonably satisfactory to the Trustee; and
(3) has been appointed by the Company and has agreed, pursuant to a
Joint Collateral Agent Undertaking, to act as collateral agent for the
equal and ratable benefit of all present and future holders of Notes and
Parity Lien Debt, whenever incurred, and also for the benefit of the
present and future holders of all other Note Obligations and Parity Lien
Obligations, in its capacity as such collateral agent, and any successor in
such capacity.
"Joint Collateral Agent Undertaking" means a declaration of trust for a
collateral trust, a collateral trust agreement or a collateral agency agreement
executed and delivered by the Company and the Joint Collateral Agent on
customary terms reasonably satisfactory to the Trustee.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of Wilmington, Delaware (for so long as the Company
maintains an office or agency in such location, or alternatively, in the City of
New York, if at such time the Company maintains an office or agency in the
Borough of Manhattan, the City of New York) or at a place of payment are
authorized by law, regulation or executive order to remain closed. 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 on such payment for the intervening period.
18
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind that, in each case, has the
practical effect of creating a security interest in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Litigation" means any litigation (1) disclosed in the Offering Circular
dated August 1, 2003 prepared in connection with the offering of the Initial
Notes including the financial statements included therein, or (2) relating or
ancillary to or arising from the same subject matter.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Income" means, with respect to any specified Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:
(1) any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with: (a) any
Asset Sale; or (b) the disposition of any securities by such Person or any
of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries; and
(2) any extraordinary gain (but not loss), together with any related
provision for taxes on such extraordinary gain (but not loss);
provided that with respect to the Company, Net Income shall be calculated to
include the aggregate amount of all distributions made pursuant to clauses (11)
and (12) of Section 4.07(b) hereof as if such distributions were interest
expense of the Company recorded as of the dates that each such distribution was
made.
"Net Proceeds" means the aggregate cash proceeds received by Dynegy or any
Restricted Subsidiary in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-cash
consideration received in any Asset Sale), net of the direct costs relating to
such Asset Sale, including, without limitation, legal, accounting and investment
banking fees, and sales commissions, and any relocation expenses incurred as a
result of the Asset Sale, taxes paid or payable as a result of the Asset Sale,
in each case, after taking into account any available tax credits or deductions,
any tax sharing arrangements and amounts reserved for adjustment in respect of
the sale price of such asset or assets established in accordance with GAAP. In
the case of any non-wholly owned Restricted Subsidiary of the Company, "Net
Proceeds" shall be net of any payments required to be made to any minority
interest holder in such Restricted Subsidiary that is not a Restricted
Subsidiary of the Company from the proceeds of any Asset Sales by such
Restricted Subsidiary.
"Netting Agreement" means a Netting Agreement, master Netting Agreement or
other similar document having the same effect as a Netting Agreement or master
Netting Agreement and, as applicable, any collateral annex, security agreement,
or other similar document related to any master Netting Agreement (in each case
entered into in the ordinary course of business) or any Permitted Contract.
"NGL Assets" means, in accordance with the definition of "Principal
Property" contained in the 1996 Indenture and the DNE Guarantees, any natural
gas, natural gas liquids or crude oil pipeline, distribution system, gathering
system, storage facility or processing plant (excluding any such property that
in the good faith opinion of the Company's Board of Directors is not of material
importance to the
19
business conducted by the Company and its consolidated Subsidiaries taken as a
whole) and any equity interests or indebtedness of any Person which owns any of
the foregoing.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (A) provides credit support of any kind (including any
undertaking, agreement or instrument that would constitute Indebtedness),
(B) is directly or indirectly liable as a guarantor or otherwise, or (C)
constitutes the lender;
(2) no default with respect to which (including any rights that the
holders of the Indebtedness may have to take enforcement action against an
Unrestricted Subsidiary) would permit upon notice, lapse of time or both
any holder of any other Indebtedness of the Company or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or
cause the payment of the Indebtedness to be accelerated or payable prior to
its Stated Maturity; and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the stock or assets of the Company or any of
its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Documents" means this Indenture, each Sharing Confirmation, the
Notes, the Note Guarantees and the Security Documents.
"Note Guarantee" means the Guarantee by each Guarantor of the Company's
payment obligations under this Indenture and on the Notes, executed pursuant to
the provisions of this Indenture.
"Note Lien" means, to the extent securing Note Obligations, a Lien granted
by a Security Document as security for Note Obligations or, if held by the Joint
Collateral Agent, as security for Note Obligations and Parity Lien Obligations.
"Note Lien Assignment" means an instrument reasonably satisfactory to the
Trustee assigning to the Joint Collateral Agent, without recourse and without
any representation, warranty or liability whatsoever, the Note Liens and all
rights, interests, powers and benefits of the Collateral Trustee under the
Security Documents.
"Note Obligations" means the Notes, the Note Guarantees and all other
Obligations of any Obligor under the Note Documents.
"Notes" has the meaning assigned to it in the preamble to this Indenture.
The Initial Notes of any series and the Additional Notes of the same series
shall be treated as a single class for all purposes under this Indenture, and
unless the context otherwise requires, all references to the Notes shall include
the Initial Notes and any Additional Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Obligor" means the Company, each of the Subsidiary Guarantors, each of the
Affiliate Guarantors and any other Person that at any time guarantees or
provides collateral security or credit support for any of the Notes (including
any Additional Notes issued hereunder) and all other Obligations
20
of the Company and any Guarantor under this Indenture, the Notes (including any
Additional Notes issued hereunder) and the Security Documents.
"Officers' Certificate" means a certificate signed on behalf of the Company
by two Officers of the Company, one of whom must be the principal executive
officer, the principal financial officer, the treasurer, assistant treasurer or
the principal accounting officer of the Company, that meets the requirements of
Section 14.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 14.05 hereof.
The counsel may be an employee of or counsel to the Company, any Guarantor or
the Trustee.
"Parents" means Dynegy and BG Holdings, Inc. and their successors and
assigns.
"Parity Lien" means a Lien granted by a Security Document to the Collateral
Trustee upon any property of the Company or any other Obligor to secure Parity
Lien Obligations.
"Parity Lien Debt" means:
(1) the Notes; and
(2) any other Indebtedness (including Additional Notes) that (A) is
permitted to be incurred pursuant to Section 4.09 hereof; or (B) is permitted to
be secured by Parity Liens by clauses (2) or (3) of the definition of Permitted
Liens; provided, in the case of each issue or series of Indebtedness referred to
in this clause (2), that:
(A) on or before the date on which such Indebtedness was incurred by
the Company such Indebtedness is designated by the Company, in an Officers'
Certificate delivered to each Parity Debt Representative and the Collateral
Trustee on or before such date, as Parity Lien Debt for the purposes of
this Indenture and the Intercreditor Agreement;
(B) such Indebtedness is governed by an indenture or other agreement
that includes a Sharing Confirmation; and
(C) all requirements set forth in the Intercreditor Agreement as to
the confirmation, grant or perfection of the Collateral Trustee's Liens to
secure such Indebtedness or Obligations in respect thereof are satisfied,
(and the satisfaction of such requirements and the other provisions of this
clause (2) shall be conclusively established, for purposes of entitling the
holders of such Indebtedness to share equally and ratably with the other holders
of Parity Lien Debt in the benefits and proceeds of the Collateral Trustee's
Liens on the Collateral, if the Company delivers to the Collateral Trustee an
Officers' Certificate stating that such requirements and other provisions have
been satisfied and that such Indebtedness is Parity Lien Debt, together with an
Opinion of Counsel stating that such Officers' Certificate has been duly
authorized by the Board of Directors of the Company and has been duly executed
and delivered, and the holders of such Indebtedness and Obligations in respect
thereof shall be entitled to rely conclusively thereon).
"Parity Lien Obligations" means Parity Lien Debt and all other Obligations
in respect thereof.
"Parity Debt Representative" means:
21
(1) in the case of the Notes, the Trustee; or
(2) in the case of any other Series of Parity Lien Debt, the Trustee,
agent or representative of the holders of such Series of Parity Lien Debt
who maintains the transfer register for such Series of Parity Lien Debt and
is appointed as a Parity Debt Representative (for purposes related to the
administration of the Security Documents) pursuant to this Indenture or
other agreement governing such Series of Parity Lien Debt.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Permitted Business" means the business substantially similar to the lines
of business conducted by the Company and its Restricted Subsidiaries as of the
date of this Indenture or any business or activity that is reasonably related,
ancillary or complementary thereto or a reasonable extension, development or
expansion thereof.
"Permitted Collateral" means any of the following property: (1) receivables
(together with general intangibles, and payment intangibles related thereto or
arising therefrom and all proceeds and products of any of the foregoing), (2)
cash and short-term investments, and (3) all dividends, interest, distributions,
and other proceeds from time to time received, receivable or otherwise
distributed in respect of, or in exchange for, any or all of the foregoing.
"Permitted Contract" means (1) any contracts and transactions for the
purchase, sale, exchange of, or the option (whether physical or financial) to
purchase, sell or exchange (a) natural gas, (b) electricity, (c) coal, (d)
petroleum-based liquids, (e) oil, (f) emissions, (g) waste byproducts, (h)
weather, or (i) any other energy-related commodity or derivative; (2) any
contracts or transactions for the processing, transmission, transportation, or
storage of, or any other services related to any commodity identified in
subparts (1)(a) through (i) above, including any capacity agreement; (3) any
financial derivative agreement (including but not limited to swaps, options or
swaptions) related to any commodity identified in subparts (1)(a) through (i)
above, or to any interest rate or currency rate management activities; (4) any
agreement for membership or participation in an organization that facilitates or
permits the entering into or clearing of any Netting Agreement or any agreement
described in this definition; (5) any agreement combining part or all of a
Netting Agreement or part or all of any of the agreements described in this
definition; or (6) any document relating to any agreement described in this
definition that is filed with a governmental body and any related service
agreements.
"Permitted Investments" means:
(1) any Investment in the Company or in a Restricted Subsidiary of
the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary of the
Company in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of the Company;
or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or
is liquidated into, the Company or a Restricted Subsidiary of the
Company;
22
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with Section 4.10 hereof;
(5) any Investment in any Person solely in exchange for the issuance
of Equity Interests (other than Disqualified Stock) of the Company;
(6) any Investments received (a) in compromise or resolution of
obligations of trade creditors or customers that were incurred in the
ordinary course of business of the Company or any of its Restricted
Subsidiaries, including (i) obligations of financially troubled account
debtors to the extent reasonably necessary in order to prevent or limit
loss and (ii) pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of any trade creditor or customer, (b) in
compromise or resolution of litigation, arbitration or other disputes, or
(c) on account of any claim against, or an interest in, any other Person
(i) acquired in good faith in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of such other
Person or (ii) as a result of a bona fide foreclosure by the Company or any
of its Restricted Subsidiaries with respect to any claim against any other
Person;
(7) Investments represented by Hedging Obligations;
(8) any Investment consisting of extensions of credit including,
without limitation, accounts receivables or notes receivables owing to the
Company or any of its Restricted Subsidiaries arising from the grant of
trade credit or prepayments or similar transactions, if created or acquired
in the ordinary course of business;
(9) any Investment existing on the date of this Indenture;
(10) Investments in the form of, or pursuant to, operating agreements,
joint ventures, partnership agreements, working interests, royalty
interests, mineral leases, processing agreements, farm-out agreements,
contracts for the sale, transportation or exchange of oil and natural gas,
unitization agreements, pooling agreements, area of mutual interest
agreements, production sharing agreements or other similar or customary
agreements, transactions, properties, interests or arrangements, and
Investments and expenditures in connection therewith or pursuant thereto,
in each case, made or entered into in the ordinary course of business;
(11) Investments in Affiliates of the Company resulting from the
drawings under, or renewals or extensions of, letters of credit, surety
bonds, guarantees, or performance bonds supporting obligations of such
Affiliates, and Investments in Subsidiaries of the Company to cash
collateralize obligations supported by such letters of credit, bonds or
guarantees if they expire or are cancelled undrawn to be made by the
Company or any of its Subsidiaries in order to avoid a default pursuant to
contracts or agreements;
(12) Investments made in connection with any Discontinued Business
Operations or Litigation so long as (a) in the case of any Discontinued
Business Operations other than as described in clause (b) below, the
aggregate amount of such Investments shall not exceed $30.0 million since
the date of this Indenture and (b) in the case of tolling agreements,
Litigation or the wind-down, settlement or disposition of third party risk
management transactions, (i) the Company or its Subsidiaries shall have
received reasonably equivalent value for such Investment, or (ii) (in the
case of tolling agreements) the liabilities, if any, in respect of such
Investment shall not be any greater than the liabilities associated with
the applicable tolling agreement;
23
(13) Investments in any (a) Person in which the Company or any of its
Subsidiaries, directly or indirectly, owns Equity Interests, to provide for
the operation, maintenance or working capital of such Person or pursuant to
contractually required capital commitments, or (b) Proportionally
Consolidated Interests resulting from variances from prior periods in the
volume of natural gas processed or the volumes of natural gas liquids
produced pursuant to applicable construction and operation agreements, in
the case of clauses (a) and (b) above on a combined basis in an aggregate
amount not to exceed $20.0 million in any calendar year;
(14) Investments in Proportionally Consolidated Interests consisting
of the payment of the proportional share of operating expenses through
joint interest xxxxxxxx pursuant to applicable construction and operating
agreements;
(15) any Guarantees permitted to be incurred under this Indenture;
(16) Investments in CoGen Lyondell, Inc. or DGPI Inc. consisting of
loans or advances in the ordinary course of business consistent with past
practices relating to CoGen Lyondell, Inc. and DGPI Inc.;
(17) Investments (or distributions to allow Illinois Power to make
such payments) made by the Company or any or its Restricted Subsidiaries in
satisfaction of the obligations of Illinois Power pursuant to the Xxxxxx
Lease, in an aggregate amount, in the case of the Purchase Amount, not to
exceed $81 million (a) plus accrued rent, break costs (if applicable) and
similar amounts and (b) less any amounts outstanding pursuant to clause
(16) of Section 4.09(b) hereof; and
(18) other Investments in any Person having an aggregate Fair Market
Value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value) not to exceed $20.0 million
incurred in any calendar year.
"Permitted Liens" means:
(1) Priority Liens securing Indebtedness under one or more Credit
Facilities that was permitted by the terms of this Indenture to be incurred
and/or securing Hedging Obligations related thereto and/or ACH Obligations,
in an aggregate principal amount at any time outstanding not to exceed the
Priority Lien Cap as of the date of incurrence thereof;
(2) Parity Liens and other Liens securing Indebtedness and related
Obligations (but excluding Priority Liens) not otherwise permitted by this
definition having an aggregate principal amount not to exceed:
(a) the greater of (x) $1.5 billion or (y) the gross proceeds
from the Initial Notes, plus
(b) 10% of Consolidated Net Assets of the Company as of the date
of incurrence thereof; plus
(c) an amount equal to the aggregate amount of additional
Indebtedness that could be secured by Priority Liens under the
Priority Lien Cap as of the date of determination; provided that any
Parity Liens securing Indebtedness in an aggregate amount in excess of
the amount permitted by clauses (a) and (b) above shall be deemed to
be Priority Liens for purposes of calculating total Priority Liens at
any time outstanding under the Priority Lien Cap.
24
(3) Liens in favor of the Company or the Guarantors;
(4) Liens on property of a Person existing at the time such Person is
merged with or into or consolidated with the Company or any Subsidiary of
the Company; provided that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend to any
assets other than those of the Person merged into or consolidated with the
Company or the Subsidiary;
(5) Liens on property (including Capital Stock) existing at the time
of acquisition of the property by the Company or any Subsidiary of the
Company, provided that any Indebtedness secured by such Lien was not
incurred in contemplation of such acquisition;
(6) Liens to secure the performance of bids, trade contracts, leases
(other than Indebtedness), public or statutory obligations, surety or
appeal bonds, performance bonds or other obligations of a like nature
incurred in the ordinary course of business;
(7) Liens securing judgments for the payment of money not
constituting an Event of Default or securing appeal or other surety bonds
related to such judgments;
(8) Liens to secure Indebtedness (including in the Capital Lease
Obligations) permitted by clause (5) of Section 4.09(b) hereof covering
only the assets acquired, designed, constructed, installed or improved with
or financed by such Indebtedness;
(9) Liens existing on the date of this Indenture;
(10) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded,
provided that any reserve or other appropriate provision as is required in
conformity with GAAP has been made therefor;
(11) Liens imposed by law, such as carriers', warehousemen's,
landlord's, mechanics' materialmen's, repairmen's, employee's, lessor's,
contractor's, operator's or other like Liens, in each case, incurred in the
ordinary course of business;
(12) survey exceptions, servitudes, permits, encroachments,
exceptions, conditions, covenants, easements or reservations of, or
restrictions or rights of others for, including, without limitation,
licenses, rights-of-way, sewers, electric lines, telegraph and telephone
lines and other similar purposes, or zoning or other restrictions as to the
use of real property that were not incurred in connection with Indebtedness
and that do not in the aggregate materially adversely affect the value of
said properties or materially impair their use in the operation of the
business of such Person;
(13) Liens created for the benefit of (or to secure) the Notes (or
Note Guarantees);
(14) Pledges or deposits made under workers' compensation,
unemployment insurance, other social security benefits, insurance laws or
similar legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for payment of Indebtedness) or leases to
which such Person is a party;
25
(15) Liens in respect of "true leases", and not in respect of
Indebtedness, arising from Uniform Commercial Code financing statements for
information purposes with respect to leases incurred in the ordinary course
of business and not otherwise prohibited by this Indenture;
(16) Liens arising under Section 9.343 of the Texas Uniform Commercial
Code or similar statutes of states other than Texas;
(17) Liens arising under obligations or duties affecting any of the
property of any Person to any municipality or public authority with respect
to any franchise, grant, license or permit which do not materially impair
the use of such property for the purposes for which it is held;
(18) inchoate statutory Liens arising under ERISA;
(19) Liens (a) to secure obligations with respect to (i) contracts for
commercial and trading activities in the ordinary course of business and
contracts (including, without limitation, physical delivery, option
(whether cash or financial), exchange, swap and future contracts) for the
purchase, transmission, distribution, sale, lease or hedge of any
energy-related commodity or service, (ii) interest rate, commodity price or
currency rate management contracts or derivatives, and (iii) customary oil,
gas and/or mineral leases for bonus or rental payments and for compliance
with the terms of such leases, and (b) encumbering accounts or receivables
arising out of Netting Agreements and contracts or agreements relating to
the generation, distribution or transmission of energy;
(20) Liens on cash and short-term investments deposited by the Company
or any of its Restricted Subsidiaries with or on behalf of brokers,
credit-clearing organizations, independent system operators, regional
transmission organizations, pipelines, futures contract brokers, customers,
trading counterparties or any other parties, or pledged by the Company or
any of its Restricted Subsidiaries to secure the Obligations of the Company
or any of its Restricted Subsidiaries with respect to or arising under
Permitted Contracts, Netting Agreements and letters of credit supporting
Permitted Contracts and Netting Agreements;
(21) Liens granted by Dynegy or any of its Restricted Subsidiaries on
its or their rights under any insurance policy, but only to the extent that
such Lien is granted to the insurers under such insurance policies or any
insurance premium finance company to secure payment of the premiums and
other amounts owed to the insurers or such premium finance company with
respect to such insurance policy;
(22) Liens securing reimbursement obligations with respect to letters
of credit that encumber documents and other property relating to such
letters of credit and the proceeds and products thereof;
(23) Liens on cash deposits in the nature of a right of setoff,
banker's lien, counterclaim or netting of cash amounts owed arising in the
ordinary course of business on deposit accounts;
(24) Liens arising out of property presently existing and future
division and transfer orders, advance payment agreements, processing
contracts, gas processing plant agreements, operating agreements, gas
balancing agreements, pooling, unitization or communitization agreements,
pipeline, gathering or transportation agreements, platform agreements,
drilling contracts, injection or repressuring agreements, cycling
agreements, construction agreements, salt water or other disposal
agreements, leases or rental agreements, farm-out or farm-in agreements,
exploration and development agreements, and any and all other contracts or
agreement (including
26
agreements related to Proportionally Consolidated Interests) covering,
arising out of, used or useful in connection with or pertaining to the
exploration, development, operation, production, sale, use, purchase,
exchange, storage, separation, dehydration, treatment, compression,
gathering, transportation, processing, improvement, marketing, disposal or
handling of any property of a Person, provided such agreements are entered
into in the ordinary course of business and are consistent with past
practices and contain terms customary for such agreements in the industry;
(25) Liens to secure any refinancing, refunding, extension, renewal or
replacement (or successive refinancings, refundings, extensions, renewals
or replacements) as a whole, or in part, of any Indebtedness secured by a
Lien referred to in the foregoing clauses (1), (2), (3), (8), (9), (13) and
(26); provided that (A) such new Lien shall be limited to all or part of
the same property or assets that secured the original Lien (plus repairs,
improvements and additions to such property or assets and Liens on the
stock or other ownership interest in one or more Restricted Subsidiaries
beneficially owning such property or assets) and (B) the amount of the
Indebtedness secured by such Lien at such time is no greater than the
principal amount or, if greater, the maximum commitment of such
Indebtedness at the time such Lien was permitted hereunder (other than
increases in an amount necessary to pay fees and expenses, including
premiums, related to the refinancing, refunding, extension, renewal or
replacement of such Indebtedness); and
(26) other Liens to secure Indebtedness in an aggregate amount not to
exceed $50.0 million at any time outstanding.
"Permitted Payments to Parents" means, without duplication as to amounts:
(1) payments to the Parents to permit the Parents to pay their
operating costs and expenses in the ordinary course consistent as to scope,
character and amount with past practices and otherwise maintain their
existence, including, without limitation, all reasonable accounting,
general corporate overhead, legal and administrative expenses, directors'
fees and expenses and SEC filing fees, of the Parents when due;
(2) for so long as the Company is a member of a group filing a
consolidated or combined tax return with the Parents, payments to the
Parents in respect of an allocable portion of the tax liabilities of such
group that is attributable to the Company and its Subsidiaries ("Tax
Payments"). The Tax Payments shall not exceed the lesser of (a) the amount
of the relevant tax (including any penalties and interest) that the Company
would owe if the Company were filing a separate tax return (or a separate
consolidated or combined return with its Subsidiaries that are members of
the consolidated or combined group), taking into account any carryovers and
carrybacks of tax attributes (such as net operating losses) of the Company
and its Subsidiaries from other taxable years and (b) the net amount of the
relevant tax that the Parents actually owe to the appropriate taxing
authority. Any Tax Payments received from the Company shall be paid over to
the appropriate taxing authority within 30 days of the Parents' receipt of
such Tax Payments or refunded to the Company; and
(3) payments by Illinova or Illinois Power, directly or indirectly,
to the Parents pursuant to that certain Services & Facilities Agreement,
dated as of June 27, 2000, among Dynegy, Illinois Power and the other
parties thereto, providing for central management of certain services,
facilities and properties, as in effect on the date of this Indenture, as
amended, modified or replaced on terms no less favorable to the Holders of
the Notes.
27
"Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, renew, refund, refinance, replace, defease
or discharge other Indebtedness of the Company or any of its Restricted
Subsidiaries (other than intercompany Indebtedness); provided that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness extended, refinanced,
renewed, replaced, defeased or refunded (plus all accrued interest on the
Indebtedness and the amount of all expenses and premiums incurred in
connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of,
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the
Notes, such Permitted Refinancing Indebtedness has a final maturity date
equal to or later than the final maturity date of, and is subordinated in
right of payment to, the Notes on terms at least as favorable to the
Holders of Notes as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded, as reasonably determined by the Company and its Restricted
Subsidiaries;
(4) such Indebtedness is incurred either by the Company or by the
Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and
(5) if incurred by the Company, such Indebtedness may be guaranteed
by the Guarantors.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other agency.
"Priority Collateral Documents" means the "Collateral Documents" (as
defined in the Credit Agreement) and any other collateral documents executed in
connection with the granting of security pursuant to the Credit Agreement or the
other "Loan Documents" (as defined in the Credit Agreement).
"Priority Collateral Trustees" means Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as corporate
trustee (together with any successor corporate trustee), and Xxxx X. Xxxxxx,
Xx., an individual residing in the State of Minnesota, not in his individual
capacity but solely as individual trustee (together with any successor
individual trustee), together being trustees for the holders of Priority Lien
Debt.
"Priority Debt Agent" means the Credit Agreement Agent or any other agent
for holders of Priority Lien Debt.
"Priority Lien" means a Lien on the Collateral that secures Indebtedness on
a first priority basis effectively senior to the comparable Lien securing the
Notes.
"Priority Lien Cap" means an amount equal to the Indebtedness outstanding
under the Credit Agreement or any other Credit Facility in an aggregate
principal amount not to exceed $2,078 million,
28
which amount shall be permanently reduced from time to time by (1) an amount
equal to the aggregate amount of all Net Proceeds from Asset Sales in excess of
the first $250.0 million of such Net Proceeds that are applied by the Company or
any Restricted Subsidiary since the date of this Indenture to repay any Priority
Lien Debt and, if to repay any revolving credit Indebtedness thereunder, to
effect a corresponding commitment reduction thereunder, in each case pursuant to
clause (1) of Section 4.10 hereof; and (2) an amount equal to the aggregate
amount of all repayments of principal of the Term B Loan made within 30 days
from the date of this Indenture. For purposes of this definition of Priority
Lien Cap, (A) any interest, penalties, premiums, fees, costs, expenses or other
Obligations in respect of any Priority Lien Debt shall not be subject to the
cap, (B) all letters of credit shall be valued at face amount, whether or not
drawn and (C) any Indebtedness outstanding under Hedging Obligations and ACH
Obligations shall be disregarded in calculating the total Priority Liens at any
time outstanding. In addition, Parity Liens incurred and existing in reliance on
clause (2)(c) of the definition of Permitted Liens shall be deemed to be
Priority Liens for purposes of calculating the total Priority Liens at any time
outstanding.
"Priority Lien Debt" means Indebtedness under (1) the Credit Agreement, (2)
the Subsidiary Facilities or (3) any other Credit Facility that is secured by a
Priority Lien that was permitted to be incurred under clause (1) of the
definition of "Permitted Liens" but only if on or before the day on which such
Indebtedness is incurred by the Company or any of its Restricted Subsidiaries
such Indebtedness is designated by the Company, in an Officer's Certificate
delivered to each Parity Debt Representative and the Collateral Trustee on or
before such date, as Priority Lien Debt for the purposes of this Indenture and
the Intercreditor Agreement.
"Priority Lien Obligations" means Priority Lien Debt and all other
Obligations in respect thereof.
"Private Placement Legend" means the legend set forth in Section 2.06(g)(1)
to be placed on all Notes issued under this Indenture except where otherwise
permitted by the provisions of this Indenture.
"Proportionally Consolidated Interest" means undivided ownership interests
in plants and gathering systems that are (1) co-owned by the Company (or its
Subsidiaries) and third parties and (2) consolidated on a proportional basis in
the financial statements of Dynegy.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Global Note bearing the Private
Placement Legend and deposited with or on behalf of the Depositary and
registered in the name of the Depositary or its nominee, issued in a
denomination equal to the outstanding principal amount of the Notes of any
series initially sold in reliance on Rule 903 of Regulation S.
"Related Party" means:
(1) any controlling stockholder or 80% (or more) owned Subsidiary of
Chevron; or
(2) any trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons beneficially
holding an 80% or more controlling interest of which consist of Chevron
and/or such other Persons referred to in the immediately preceding clause
(1).
"Replacement Assets" means (1) any property or capital assets (other than
Indebtedness and Capital Stock) to be used by Dynegy or any of its Restricted
Subsidiaries in a Permitted Business or any improvement to any property or
capital assets that are used by Dynegy or any of its Restricted
29
Subsidiaries in a Permitted Business; (2) Capital Stock of a Person that is a
Restricted Subsidiary of Dynegy or that becomes a Restricted Subsidiary of
Dynegy as a result of the acquisition of such Capital Stock by Dynegy or another
Restricted Subsidiary (including by means of merger, consolidation or other
business combination permitted under this Indenture); or (3) Capital Stock
constituting a minority interest in any Person that at such time is a Restricted
Subsidiary of Dynegy; provided, however, that any such Restricted Subsidiary
described in clauses (2) or (3) above is primarily engaged in a Permitted
Business.
"Required Parity Debtholders" means, at any time in respect of any action
or matter, holders of a majority in aggregate outstanding principal amount of
all Parity Lien Debt then outstanding, voting together as a single class. For
this purpose, Parity Lien Debt registered in the name of, or beneficially owned
by, the Company or any of its Affiliates will be deemed not to be outstanding.
"Required Priority Debtholders" means, at any time in respect of any action
or matter, (1) holders of the outstanding principal amount of the applicable
Priority Lien Debt then outstanding required pursuant to the terms of the
applicable Credit Agreement, voting as a single class, to approve such action or
matter or (2) the Priority Debt Agent acting upon the authorization or consent
of the holders referred to in the immediately preceding clause (1). For this
purpose, Priority Lien Debt registered in the name of, or beneficially owned by,
the Company or any of its Affiliates will be deemed not to be outstanding.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private Placement
Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary. All of the Company's Subsidiaries
as of the date of this Indenture shall be deemed to be Restricted Subsidiaries
of the Company. As of the date of this Indenture, the Restricted Subsidiaries of
Dynegy shall be deemed to be (1) the Company and its Restricted Subsidiaries,
(2) Illinova and its Restricted Subsidiaries and (3) BG Holdings, Inc, a
Delaware corporation. As of the date of this Indenture, the Restricted
Subsidiaries of Illinova shall be deemed to be all Subsidiaries of Illinova
other than Illinois Power Company and its Subsidiaries.
"Riverside Facility" means that certain Participation Agreement, dated
March 10, 2000, among Riverside Generating Company, L.L.C., as the lessee and
construction agent, the Company, as guarantor, Xxxxxxxx County Riverside Trust
2000, as the lessor, Atlantic Asset Securitization Corp., as tranche A lender,
the Liquidity Purchasers, the tranche B lenders and the certificate holder party
thereto, Commerzbank AG, New York and Grand Cayman Branches, as syndication
agent, Credit Agricole Indosuez, as documentation agent, and Canadian Imperial
Bank of Commerce, Bayerische Landesbank Girozentrale and KBC Bank N.V., as
co-agents, and Credit Lyonnais New York Branch, as administrative agent and lead
arranger and the operative documents referred to therein, as amended, restated,
modified, renewed, refunded, replaced (whether upon or after termination or
otherwise) or refinanced (including by means of sales of debt securities to
investors) in whole or in part from time to time.
30
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"S&P" means Standard & Poor's Ratings Group.
"Sale and Leaseback Transaction" means any arrangement relating to any
asset now owned or hereafter acquired by the Company or any of its Restricted
Subsidiaries whereby the Company or a Restricted Subsidiary of the Company
transfers such asset to a Person who is not an Affiliate of the Company and the
Company or such Restricted Subsidiary leases it from such Person, other than
leases between the Company and any of its Restricted Subsidiaries or between
Restricted Subsidiaries.
"SEC" means the Securities and Exchange Commission.
"Secured Debt" means any and all Priority Lien Debt and Parity Lien Debt.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Documents" means:
(1) that certain Second-Lien Shared Security Agreement dated as of August
11, 2003, among the Company, the additional grantors party thereto and Xxxxx
Fargo Bank Minnesota, N.A. as Collateral Trustee;
(2) that certain Second-Lien Non-Shared Security Agreement dated as of
August 11, 2003, among the Company, the additional grantors party thereto and
Xxxxx Fargo Bank Minnesota, N.A. as Collateral Trustee;
(3) those certain mortgages dated as of August 11, 2003, listed on
Schedule II to this Indenture.
(4) one or more other security agreements, pledge agreements, collateral
assignments, mortgages, deed of trust or other grants or transfers for security
executed and delivered by the Company or any other Obligor creating a Lien upon
property owned or to be acquired by the Company or such other Obligor in favor
of the Collateral Trustee for the benefit of the holders of Note Obligations or,
if held by the Joint Collateral Agent, for the equal and ratable benefit of all
present and future holders of Notes and Parity Lien Debt, whenever incurred, and
also for the benefit of the present and future holders of all other Note
Obligations and Parity Lien Obligations.
"Series B Restructuring Transaction" means the exchange of the Series B
Mandatorily Redeemable Preferred Stock of Dynegy held by Chevron and the other
transactions contemplated thereby, pursuant to the Exchange Agreement dated July
28, 2003 between Dynegy and Chevron, as amended, modified or replaced on terms
no less favorable to the Holders of Notes.
"Series of Parity Lien Debt" means, severally, the Notes and each other
issue or series of Parity Lien Debt for which a single transfer register is
maintained.
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"Series of Secured Debt" means, severally, the Notes, each other issue or
series of Parity Lien Debt for which a single transfer register is maintained
and each issue or series of Priority Lien Debt for which a single transfer
register is maintained.
"Sharing Confirmation" means, as to any Series of Parity Lien Debt, the
written agreement of the holders of such Series of Parity Lien Debt, as set
forth in the indenture or agreement governing such Series of Parity Lien Debt,
for the enforceable benefit of all holders of each other existing and future
Series of Parity Lien Debt and each existing and future Parity Debt
Representative, that all Parity Lien Obligations shall be and are secured
equally and ratably by all Liens (or will share proceeds in respect of their
Liens on NGL Assets on an equal and ratable basis) at any time granted by the
Company or any other Obligor to secure any Obligations in respect of such Series
of Parity Lien Debt, whether or not upon property otherwise constituting
Collateral, that all such Liens shall be enforceable by the Collateral Trustee
for the benefit of all holders of Parity Lien Obligations equally and ratably,
and that the holders of Obligations in respect of such Series of Parity Lien
Debt are bound by the provisions in the Intercreditor Agreement relating to the
order of application of proceeds from enforcement of the Collateral Trustee's
Liens upon the Collateral, and consent to and direct the Collateral Trustee to
perform its obligations under the Intercreditor Agreement.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date of
this Indenture.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness, and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subordinated Debenture Indenture" means the Subordinated Debenture
Indenture for Subordinated Deferrable Interest Debentures dated May 28, 1997
between NGC Corporation (as predecessor of the Company), The First National Bank
of Chicago, as trustee, and the other parties thereto, with respect to the
Subordinated Debentures.
"Subordinated Debentures" means the $200.0 million in aggregate principal
amount of the Company's 8.316% Subordinated Debentures due 2027.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of which
more than 50% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees of the corporation, association
or other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or
(b) the only general partners of which are that Person or one or more
Subsidiaries of that Person (or any combination thereof).
"Subsidiary Facilities" means any of the Alpha Facility, the CoGen Lyondell
Facility and the Riverside Facility.
32
"Subsidiary Guarantees" means the Guarantees of the Notes by the Subsidiary
Guarantors.
"Subsidiary Guarantors" means:
(1) the following Restricted Subsidiaries of the Company (subject to
Section 10.05 hereof): Dynegy Power Corp.; DPC II Inc.; Black Mountain
CoGen, Inc.; Bluegrass Generation, Inc.; Bluegrass Generation Company,
L.L.C.; Calcasieu Power, Inc.; Parish Power, Inc.; Calcasieu Power, LLC;
Delta Cogen, Inc.; Chesapeake Power, Inc.; Xxxxx River Energy Corp.; DPC
Power Resources Holding Company; Dry Creek Power, Inc.; Rockingham Power,
L.L.C.; Dynegy Power Development Company; Dynegy Power Holdings, Inc.;
CoGen Power, Inc.; CoGen Power, L.P.; Dynegy Engineering, Inc.; Dynegy
Management, Inc.; Dynegy Services, Inc.; Dynegy Power Management Services,
L.P.; Dynegy Operating Company; Dynegy Parts and Technical Services, Inc.;
Dynegy Power Management Services, Inc.; HEP CoGen, Inc.; Xxxxxxxx XxXxx,
Inc.; Dynegy Power Investments, Inc.; Dynegy Power Services, Inc.; Dynegy
Power Nevada, Inc.; Dynegy Cabrillo II LLC; Blue Ridge Generation Inc.;
Blue Ridge Generation LLC; Chickahominy Generating Company; Chickahominy
Power, LLC; Florida Mercantile Power, Inc.; Palmetto Power, L.L.C.;
Gasification Services, Inc.; Georgia Mercantile Power, Inc.; Heard County
Power, L.L.C.; Xxxx County IPP, Inc.; Hartwell Independent Power Partners,
Inc.; Hartwell Power Company; Michigan CoGen, Inc.; Michigan Power, Inc.;
Michigan Power Holdings, Inc.; OCG CoGen, Inc.; Oyster Creek CoGen, Inc.;
RRP Company; DPC Colombia-Opon Power Resources Company; Termo Santander
Holding, LLC; Riverside Generation, Inc.; Riverside Generating Company,
L.L.C.; Rolling Hills Generation, Inc.; Dynegy Renaissance Power, Inc.;
Dynegy Northeast Generation, Inc.; Xxxxxx Power, L.L.C.; Dynegy Danskammer,
L.L.C.; Dynegy Roseton, L.L.C.; Dynegy Xxxxxx Power Retail, L.L.C.; DMS LP,
Inc.; Dynegy Midstream G.P., Inc.; Dynegy Midstream Services, Limited
Partnership; Midstream Barge Company, L.L.C.; Dynegy Liquids G.P., L.L.C.;
Dynegy Liquids Marketing and Trade; Dynegy Regulated Holdings, LLC; Dynegy
OPI, LLC; Dynegy NGL Pipeline Company, LLC; Dynegy Intrastate Pipeline,
LLC; Dynegy Energy Pipeline Company LLC; Dynegy Global Energy, Inc.; Dynegy
Upper Holdings, L.L.C.; Dynegy Holding Company, L.L.C.; DMG Enterprises,
Inc.; Havana Dock Enterprises, LLC; DMT Holdings, Inc.; DMT L.P. L.L.C.;
DMT G.P., L.L.C.; DMT Holdings, L.P.; Dynegy Broadband Marketing and Trade;
Dynegy GP Inc.; Dynegy Marketing and Trade; Dynegy Coal Trading and
Transportation, L.L.C.; NGC Storage, Inc.; Dynegy Technology Capital Corp.;
Dynegy Strategic Investments LP, Inc.; Dynegy Strategic Investments, LP;
Dynegy Strategic Investments GP, L.L.C.; Dynegy Energy Services, Inc.;
Illinois Power Energy, Inc.; DES Northeast, Inc.; DEM GP, LLC; DEM LP LLC;
Dynegy Energy Marketing, LP; Dynegy Administrative Services Company; NIPC,
Inc.; Dynegy I.T., Inc.; DFS LP, LLC; DFS General Partner, LLC; Dynegy
Financial Services, LP; Dynegy Xxxxxx Member, Inc.; Dynegy Midwest
Generation, Inc.; Dynegy Power Marketing, Inc.; Renaissance Power, L.L.C.;
Rolling Hills Generating, L.L.C.; and Black Thunder Member, Inc.; and
(2) any other Subsidiary of the Company that executes a Subsidiary
Guarantee in accordance with the provisions of this Indenture,
and their respective successors and assigns.
"Term B Loan" means the $360 million in aggregate principal amount of the
term B loan under the Credit Agreement.
"Termination Date" means the earlier to occur of (a) the date on which the
notice from the holder of the DYN Notes to terminate the mandatory prepayment
obligations thereunder has become effective in
33
accordance with and pursuant to the terms and procedures set forth in the DYN
Notes or (b) the third anniversary of the date of this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of this Indenture.
"Xxxxxx Lease" means that certain Amended and Restated Participation
Agreement, dated October 30, 2002, among Illinois Power and the other parties
thereto.
"Treasury Rate" means, as of any redemption date, the yield to maturity as
of such redemption date of United States Treasury securities with a constant
maturity (as compiled and published in the most recent Federal Reserve
Statistical Release H.15 (519) that has become publicly available at least two
Business Days prior to the redemption date (or, if such Statistical Release is
no longer published, any publicly available source of similar market data) most
nearly equal to the period from the redemption date to (1) July 15, 2006, in the
case of the Series A Notes, (2) July 15, 2007, in the case of the Series B
Notes, or (3) July 15, 2008, in the case of the Series C Notes; provided,
however, that if the period from the redemption date to (1) July 15, 2006, in
the case of the Series A Notes, (2) July 15, 2007, in the case of the Series B
Notes, or (3) July 15, 2008, in the case of the Series C Notes, in each case is
less than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year will be used.
"Trustee" means the party named as such in the preamble to this Indenture
until a successor replaces it in accordance with the applicable provisions of
this Indenture and thereafter means the successor serving hereunder.
"Unasserted Contingent Obligations" means, at any time, Obligations for
taxes, costs, indemnifications, reimbursements, damages and other liabilities
(except (i) the principal of and interest and premium (if any) on, and fees
relating to, any Indebtedness and (ii) contingent obligations to reimburse the
issuer of an outstanding letter of credit for amounts that may be drawn or paid
thereunder) in respect of which no claim or demand for payment has been made at
such time.
"Unrestricted Global Note" means a permanent global Note substantially in
the form of the applicable Exhibit A attached hereto that bears the Global Note
Legend and that has the "Schedule of Exchanges of Interests in the Global Note"
attached thereto, and that is deposited with or on behalf of and registered in
the name of the Depositary, representing a series of Notes that do not bear the
Private Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes that do
not bear and are not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means any Subsidiary of the Company that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a
Board Resolution, but only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) except as permitted pursuant to Section 4.11, is not party to any
agreement, contract, arrangement or understanding with the Company or any
Restricted Subsidiary of the Company unless the terms of any such agreement,
contract, arrangement or understanding are no less favorable to the Company or
such Restricted Subsidiary than those that might be obtained at the time from
Persons who are not Affiliates of the Company;
34
(3) is a Person with respect to which neither the Company nor any of its
Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe
for additional Equity Interests or (b) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results; and
(4) has not guaranteed or otherwise directly or indirectly provided credit
support for any Indebtedness of the Company or any of its Restricted
Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.07 hereof. If, at any time,
any Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date pursuant to Section 4.09 hereof, the Company will be in
default of such covenant. The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if (1) such
Indebtedness is permitted pursuant to Section 4.09 hereof calculated on a pro
forma basis as if such designation had occurred at the beginning of the
four-quarter reference period; and (2) no Default or Event of Default would be
in existence following such designation. Upon any such designation of an
Unrestricted Subsidiary as a Restricted Subsidiary, the redesignated Subsidiary
will: (a) become a Guarantor and execute a supplemental indenture and deliver an
opinion of counsel satisfactory to the Trustee within 10 Business Days of the
date on which it was acquired or created; provided, that any redesignated
Restricted Subsidiary that constitutes an Immaterial Subsidiary need not become
a Guarantor until such time as it ceases to be an Immaterial Subsidiary, and (b)
become a party to the Security Documents.
"U.S. Person" means a U.S. Person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other
required payments of principal, including payment at final maturity, in
respect of the Indebtedness, by (b) the number of years (calculated to the
nearest one-twelfth) that shall elapse between such date and the making of
such payment; by
(2) the then outstanding principal amount of such Indebtedness.
Section 1.02 Other Definitions.
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Defined
in
Term Section
---- --------
"Affiliate Transaction" ..............................................4.11
"Asset Sale Offer" ...................................................3.09
"Authentication Order" ...............................................2.02
"Calculation Agent" ..................................................2.03
"Change of Control Offer" ............................................4.15
"Change of Control Payment" ..........................................4.15
"Change of Control Payment Date" .....................................4.15
"Covenant Defeasance" ................................................8.03
"Event of Default" ...................................................6.01
"Excess Proceeds" ....................................................4.10
"incur" ..............................................................4.09
"Legal Defeasance" ...................................................8.02
"Offer Amount" .......................................................3.09
"Offer Period" .......................................................3.09
"Paying Agent" .......................................................2.03
"Permitted Debt" .....................................................4.09
"Permitted Illinova Subsidiary Contracts" ............................4.07
"Purchase Date" ......................................................3.09
"Registrar" ..........................................................2.03
"Restricted Payments" ................................................4.07
Section 1.03 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 TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Note Guarantees means the Company and the
Guarantors, respectively, and any successor obligor upon the Notes and the Note
Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
36
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) "will" shall be interpreted to express a command;
(6) the "date of this Indenture" or "date hereof" means the date of
original issuance of the Initial Notes;
(7) provisions apply to successive events and transactions; and
(8) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Series A Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A1 hereto. The
Series B Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A2 hereto. The Series C Notes and the
Trustee's certificate of authentication shall be substantially in the form of
Exhibit A3 hereto. The Notes may have notations, legends or endorsements
required by law, stock exchange rule or usage. Each Note shall be dated the date
of its authentication. The Notes shall be in denominations of $1,000 and
integral multiples thereof.
The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Indenture and the Company, the Guarantors
and the Trustee, by their execution and delivery of this Indenture, expressly
agree to such terms and provisions and to be bound thereby. However, to the
extent any provision of any Note conflicts with the express provisions of this
Indenture, the provisions of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form shall be substantially in
the form of Exhibits A1, A2 or A3, as applicable, attached hereto (including the
Global Note Legend thereon and the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Notes issued in definitive form shall be
substantially in the form of Exhibits A1, A2 or A3, as applicable, attached
hereto (but without the Global Note Legend thereon and without the "Schedule of
Exchanges of Interests in the Global Note" attached thereto). Each Global Note
shall represent such of the outstanding Notes as shall be specified thereon and
each shall provide that it represents the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Any endorsement of a Global Note to reflect the amount of any increase or
decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as required
by Section 2.06 hereof.
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(c) Euroclear and Clearstream Procedures Applicable. 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 Clearstream
Banking" and "Customer Handbook" of Clearstream shall be applicable to transfers
of beneficial interests in the Regulation S Global Notes that are held by
Participants through Euroclear or Clearstream.
Section 2.02 Execution and Authentication.
At least one Officer must sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that office at
the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee shall, upon receipt of a written order of the Company signed by
two Officers (an "Authentication Order"), authenticate Notes for original issue
in unlimited aggregate principal amount, subject to the provisions of this
Indenture, including without limitation Section 4.09 hereof. Each such
Authentication Order shall specify the series of Notes being issued, the amount
of Notes to be authenticated, the date on which the Notes are to be
authenticated and, in the case of Additional Notes, the issue price of the
Notes.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Notes. An authenticating agent may authenticate Notes whenever
the Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with Holders, the Company or an Affiliate of the
Company.
Section 2.03 Registrar, Paying Agent and Calculation Agent.
The Company shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may appoint one or more co-registrars and one or more additional paying
agents. The term "Registrar" includes any co-registrar and the term "Paying
Agent" includes any additional paying agent. The Company may change any Paying
Agent or Registrar without notice to any Holder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to act
as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
In addition, the Company may delegate the responsibility for determining
the Applicable Eurodollar Rate with respect to the Series A Notes to the Trustee
as calculation agent (the "Calculation Agent"), on such terms and conditions as
are reasonably acceptable to the Trustee; provided that under all
38
circumstances the Calculation Agent shall determine the Applicable Eurodollar
Rate pursuant to the formulation set forth in the definition thereof in Section
1.01 hereof.
The Calculation Agent will, upon the request of the Holder of any Series A
Note, provide the interest rate then in effect with respect to the Series A
Notes. All calculations made by the Calculation Agent in the absence of manifest
error shall be conclusive for all purposes and binding on the Company and the
Holders of Series A Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that subject to Articles 8 and 13, the Paying Agent shall hold in
trust for the benefit of Holders or the Trustee all money held by the Paying
Agent for the payment of principal, premium, if any, or interest on the Notes,
and shall notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may upon written request
to a Paying Agent require such Paying Agent to pay all money held by it to the
Trustee and account for any amounts paid. The Company at any time may require
such Paying Agent to pay all money held by it to the Trustee. Upon payment over
to the Trustee, the Paying Agent (if other than the Company or a Subsidiary)
shall have no further liability for the money. If the Company or a Subsidiary
acts as Paying Agent, it shall segregate and hold in a separate trust fund for
the benefit of the Holders all money held by it as Paying Agent. Upon any
bankruptcy or reorganization proceedings relating to the Company, the Trustee
shall serve as Paying Agent for the Notes.
Section 2.05 Holder 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
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
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 the Holders of
Notes and the Company shall otherwise comply with TIA Section 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes shall be exchanged
by the Company for Definitive Notes if:
(1) the Company delivers to the Trustee notice from the Depositary
that it is unwilling or unable to continue to act as Depositary or that it
is no longer a clearing agency registered under the Exchange Act and, in
either case, a successor Depositary is not appointed by the Company within
120 days after the date of such notice from the Depositary; or
(2) the Company in its sole discretion determines that the Global
Notes (in whole but not in part) should be exchanged for Definitive Notes
and delivers a written notice to such effect to the Trustee.
In addition, Holders of any series of Notes may request the Trustee to exchange
Global Notes of such series for Definitive Notes if there has occurred and is
continuing a Default or Event of Default with
39
respect to such series of Notes. Upon the occurrence of any of the events in (1)
or (2) above or the preceding sentence, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b) or (c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth hereof to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Restricted Period, transfers of
beneficial interests in the Regulation S Global Note may not be made to a
U.S. Person or for the account or benefit of a U.S. Person (other than an
Initial Purchaser). Beneficial interests in any Unrestricted Global Note
may be transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(1) above, the transferor
of such beneficial interest must deliver to the Registrar either:
(A) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to credit or cause
to be credited a beneficial interest in another Global Note
pursuant to Section 2.06(b)(3) or (4) hereof in an amount equal
to the beneficial interest to be transferred or exchanged; and
(ii) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant
account to be credited with such increase; or
(B) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note pursuant to Section 2.06(c) hereof in an
amount equal to the beneficial interest to be transferred or
exchanged; and
40
(ii) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (i) above.
Upon satisfaction of all of the requirements for transfer or exchange
of beneficial interests in Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities Act, the Trustee shall
adjust the principal amount of the relevant Global Note(s) pursuant to
Section 2.06(h) hereof.
(3) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2)(A) above and the
Registrar receives the following:
(A) if the transferee shall take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transferee shall take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof; and
(C) if the transferee shall take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications and certificates required by item (3) thereof, if
applicable.
(4) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in an Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(2)(A) above and
the Registrar receives the following:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Note, a certificate from
such holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(B) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a Person
who shall take delivery thereof in the form of a beneficial interest
in an Unrestricted Global Note, a certificate from such holder in the
form of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case, if the Registrar so requests or if the Applicable
Procedures so require, an Opinion of Counsel in form reasonably acceptable
to the Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on transfer
contained hereof and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.
41
If any such transfer is effected above at a time when an Unrestricted
Global Note has not yet been issued, the Company shall issue and, upon receipt
of an Authentication Order in accordance with Section 2.02 hereof, the Trustee
shall authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the aggregate principal amount of beneficial interests
transferred pursuant to this Section 2.06(b)(4).
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(1) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If, pursuant to Section 2.06(b)(2)(B) hereof, any holder
of a beneficial interest in a Restricted Global Note proposes to exchange
such beneficial interest for a Restricted Definitive Note or to transfer
such beneficial interest to a Person who takes delivery thereof in the form
of a Restricted Definitive Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications and
certificates required by item (3) thereof, if applicable; or
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof;
the Trustee shall cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and the
Company shall execute and the Trustee shall authenticate and deliver to the
Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Xxxxxxxxx
00
through instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons in
whose names such Notes are so registered. Any Definitive Note issued in exchange
for a beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c)(1) shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained thereof.
(2) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. Pursuant to Section 2.06(b)(2)(B) hereof, a holder of a
beneficial interest in a Restricted Global Note may exchange such
beneficial interest for an Unrestricted Definitive Note or may transfer
such beneficial interest to a Person who takes delivery thereof in the form
of an Unrestricted Definitive Note only if the Registrar receives the
following:
(i) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(ii) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case if the Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act and that
the restrictions on transfer contained hereof and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(3) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If, pursuant to Section 2.06(b)(2)(B) hereof, any holder
of a beneficial interest in an Unrestricted Global Note proposes to
exchange such beneficial interest for a Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form of a
Definitive Note, then, upon satisfaction of the conditions set forth in
Section 2.06(b)(2) hereof, the Trustee shall cause the aggregate principal
amount of the applicable Global Note to be reduced accordingly pursuant to
Section 2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest pursuant to this Section
2.06(c)(3) shall be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest
requests through instructions to the Registrar from or through the
Depositary and the Participant or Indirect Participant. The Trustee shall
deliver such Definitive Notes to the Persons in whose names such Notes are
so registered. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(3) shall not bear the Private
Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(1) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Notes to a Person who takes
43
delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following
documentation:
(A) if the Holder of such Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to a
QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such Restricted Definitive Note is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144, a certificate to the
effect set forth in Exhibit B hereto, including the certifications in
item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to
an Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications and
certificates required by item (3) thereof, if applicable; or
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof;
the Trustee shall cancel the Restricted Definitive Note, increase or
cause to be increased the aggregate principal amount of, in the case
of clause (A) above, the appropriate Restricted Global Note, in the
case of clause (B) above, the 144A Global Note, in the case of clause
(C) above, the Regulation S Global Note, and in all other cases, the
IAI Global Note.
(2) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global Note
only if the Registrar receives the following:
(i) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(c)
thereof; or
(ii) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof
in the form of a beneficial interest in the Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
44
and, in each such case if the Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that such
exchange or transfer is in compliance with the Securities Act and that
the restrictions on transfer contained hereof and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(2), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(3) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any
time. Upon receipt of a request for such an exchange or transfer, the
Trustee shall cancel the applicable Unrestricted Definitive Note and
increase or cause to be increased the aggregate principal amount of one of
the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B), (2)(D) or
(3) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of Definitive Notes so
transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
provisions of this Section 2.06(e), the Registrar shall register the transfer or
exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(1) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name
of Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following:
(A) if the transfer shall be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transfer shall be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer shall be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications and certificates required by
item (3) thereof, if applicable.
45
(2) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if the
Registrar receives the following:
(i) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive
Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(d) thereof; or
(ii) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note,
a certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case, if the Registrar so requests, 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 hereof and in the
Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(3) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a Person
who takes delivery thereof in the form of an Unrestricted Definitive Note.
Upon receipt of a request to register such a transfer, the Registrar shall
register the Unrestricted Definitive Notes pursuant to the instructions
from the Holder thereof.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and deliver to the Persons designated by the Holders of Definitive
Notes so accepted Unrestricted Definitive Notes in the appropriate principal
amount.
(f) [Reserved].
(g) Legends. The following legends shall appear on the face of all Global
Notes and Definitive Notes issued under this Indenture unless specifically
stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each Global
Note and each Definitive Note (and all Notes issued in exchange
therefor or substitution thereof) shall bear the legend in
substantially the following form
"THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, RESOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS NOTE IS NOTIFIED THAT THE SELLER OF THIS NOTE
MAY BE RELYING ON THE EXEMPTION FROM THE
46
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF DYNEGY HOLDINGS INC. THAT (A)
THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)
INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904
UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 (IF AVAILABLE), (IV) IN THE UNITED
STATES TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (A)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT), IN A MINIMUM PRINCIPAL AMOUNT OF NOT
LESS THAN $100,000, THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ANOTHER INSTITUTIONAL ACCREDITED INVESTOR FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION THEREOF IN VIOLATION OF THE SECURITIES ACT AND THAT, PRIOR TO SUCH
TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO
THE TRUSTEE A SIGNED LETTER IN THE FORM SET FORTH ON THE REVERSE HEREOF
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO RESTRICTIONS ON
TRANSFER OF THIS SECURITY (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, OR (VI) TO THE ISSUER, ITS SUBSIDIARIES OR ITS DIRECT
OR INDIRECT PARENT, IN EACH OF CASES (I) THROUGH (VI) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global Note or Definitive
Note issued pursuant to subparagraphs (b)(4), (c)(2), (c)(3), (d)(2),
(d)(3), (e)(2) or (e)(3) of this Section 2.06 (and all Notes issued in
exchange therefor or substitution thereof) shall not bear the Private
Placement Legend.
(2) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE
47
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), 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 MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE 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 HEREOF."
(h) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who shall take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who shall take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate Global Notes and
Definitive Notes upon receipt of an Authentication Order in accordance with
Section 2.02 or at the Registrar's request.
(2) No service charge shall be made to a Holder of a Global Note or
to a Holder of a Definitive Note for any registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental
charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06,
3.09, 4.10, 4.15 and 9.05 hereof).
(3) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except
the unredeemed portion of any Note being redeemed in part.
(4) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global Notes
or Definitive Notes surrendered upon such registration of transfer or
exchange.
(5) Neither the Company nor the Registrar shall be required:
(A) to issue, to register the transfer of or to exchange any
Notes during a period beginning at the opening of business 15 days
before the day of any selection of Notes for
48
redemption under Section 3.02 hereof and ending at the close of
business on the day of selection;
(B) to register the transfer of or to exchange any Note selected
for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part; or
(C) to register the transfer of or to exchange a Note between a
record date and the next succeeding interest payment date.
(6) Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any Agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of such
Note for the purpose of receiving payment of principal of and interest on
such Notes and for all other purposes, and none of the Trustee, any Agent
or the Company shall be affected by notice to the contrary.
(7) All certifications, certificates and Opinions of Counsel required
to be submitted to the Registrar pursuant to this Section 2.06 to effect a
registration of transfer or exchange may be submitted by facsimile.
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order, shall authenticate a replacement Note if the requirements
of Section 8-405 of the Uniform Commercial Code of the State of New York (or any
successor statute thereto) are met, such that the Holder (a) satisfies the
Company or the Trustee within a reasonable time after such Holder has notice of
such loss, destruction or theft and the Registrar does not register a transfer
prior to receiving such notification, (b) makes such request to the Company or
the Trustee prior to the Note being acquired by a protected purchaser as defined
in Section 8-303 of the Uniform Commercial Code (or any successor statute
thereto) and (c) satisfies any other reasonable requirements of the Trustee. If
required by the Trustee or the Company, an indemnity bond must be supplied by
the Holder that is sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent and any authenticating agent from
any loss that any of them may suffer if a Note is replaced. The Company may
charge for its expenses in replacing a Note, including fees and expenses of
counsel and of the Trustee.
Every replacement Note is an additional obligation of the Company and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section as
not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note; however, Notes held by the Company or a Subsidiary of the Company
shall not be deemed to be outstanding for purposes of Section 3.07(a)(1),
3.07(b)(1) or 3.07(c)(1) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a protected purchaser.
49
If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an Affiliate
of any thereof) holds, on a redemption date or maturity date, money sufficient
to pay Notes payable on that date, then on and after that date such Notes shall
be deemed to be no longer outstanding and shall cease to accrue interest.
Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the Company
may prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes. Temporary Notes shall be substantially in the form
of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate definitive Notes in exchange for temporary Notes. Until such
exchange, Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee (or at the prior written direction of the Trustee, the Registrar or
Paying Agent) and no one else shall cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy canceled Notes (subject to the record retention requirement of the
Exchange Act). Certification of the destruction of all canceled Notes shall be
delivered to the Company. The Company may not issue new Notes to replace Notes
that it has paid or that have been delivered to the Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it shall pay
the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
may be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
Section 2.13 CUSIP Numbers.
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The Company in issuing the Notes may use a CUSIP number, and if so, the
Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to the Holders; provided, however, that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Notes, and that reliance may be placed
only on the other identification numbers printed on the Notes. The Company will
promptly notify the Trustee of any change in the CUSIP numbers.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, it must furnish to the Trustee, at least 30
days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth:
(1) the clause of this Indenture pursuant to which the redemption
shall occur;
(2) the redemption date;
(3) the principal amount and applicable series of Notes to be
redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
If less than all of the Notes are to be redeemed or purchased in an offer
to purchase at any time, the Trustee shall select Notes for redemption or
purchase as follows:
(1) if the Notes are listed on any national securities exchange, in
compliance with the requirements of the principal national securities
exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national securities exchange,
on a pro rata basis, by lot or by such method as the Trustee shall deem
fair and appropriate.
In the event of partial redemption or purchase by lot, the particular Notes
to be redeemed or purchased shall be selected, unless otherwise provided hereof,
not less than 30 nor more than 60 days prior to the redemption or purchase date
by the Trustee from the outstanding Notes not previously called for redemption
or purchase.
The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected shall be in amounts of $1,000 or
whole multiples of $1,000; except that if all of the Notes of a Holder are to be
redeemed or purchased, the entire outstanding amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except
as provided in the preceding sentence, provisions of this Indenture that apply
to Notes called for redemption or purchase also apply to portions of Notes
called for redemption or purchase.
Section 3.03 Notice of Redemption.
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Except as provided in Section 3.09 hereof, at least 30 days but not more
than 60 days before a redemption date, the Company shall mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Notes
are to be redeemed at its registered address, except that redemption notices may
be mailed more than 60 days prior to a redemption date if the notice is issued
in connection with a defeasance of the Notes or a satisfaction and discharge of
this Indenture pursuant to Articles 8 or 13 of this Indenture.
The notice shall identify the Notes to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion shall be issued upon cancellation of the
original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date and the only remaining right of Holders of such
Notes is to receive payment of the redemption price upon surrender to the
Paying Agent of the Notes redeemed;
(7) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at its expense; provided, however, that the Company
has delivered to the Trustee, at least 45 days prior to the redemption date
(unless a shorter notice period has been agreed to by the Trustee in writing),
an Officers' Certificate requesting that the Trustee give such notice and
setting forth the information to be stated in such notice as provided in the
preceding paragraph.
Section 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
Section 3.05 Deposit of Redemption or Purchase Price.
On or before 10:00 a.m., New York City time on the redemption or purchase
price date, the Company shall deposit with the Trustee or with the Paying Agent
money sufficient to pay the redemption or purchase price of and accrued interest
on all Notes to be redeemed or purchased on that date. The
52
Trustee or the Paying Agent shall promptly return to the Company any money
deposited with the Trustee or the Paying Agent by the Company in excess of the
amounts necessary to pay the redemption or purchase price of, and accrued
interest on, all Notes to be redeemed or purchased.
If the Company complies with the provisions of the preceding paragraph, on
and after the redemption or purchase date, interest shall cease to accrue on the
Notes or the portions of Notes called for redemption or purchase. If a Note is
redeemed or purchased on or after an interest record date but on or prior to the
related interest payment date, then any accrued and unpaid interest shall be
paid to the Person in whose name such Note was registered at the close of
business on such record date. If any Note called for redemption or purchase is
not so paid upon surrender for redemption or purchase because of the failure of
the Company to comply with the preceding paragraph, interest shall be paid on
the unpaid principal, from the redemption or purchase date until such principal
is paid, and to the extent lawful on any interest not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01
hereof.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the Company
shall issue and, upon receipt of an Authentication Order, the Trustee shall
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) Series A Notes.
(1) At any time prior to July 15, 2006, the Company may on any one or
more occasions redeem up to 35% of the aggregate principal amount of the
Series A Notes issued hereunder at a redemption price equal to par plus the
Applicable Eurodollar Rate then in effect, plus accrued and unpaid interest
to the redemption date, with a contribution to the Company's common equity
capital made with the net cash proceeds of a concurrent sale of common
stock of Dynegy; provided that:
(A) at least 65% of the aggregate principal amount of the Series
A Notes issued hereunder (excluding Notes held by the Company or any
of its Affiliates) remains outstanding immediately after the
occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
(2) At any time prior to July 15, 2006, the Company may redeem all
but not less than all of the Series A Notes upon the occurrence of a Change
of Control, upon not less than 30 nor more than 60 days prior notice (but
in any event no earlier than the date of consummation of such Change of
Control and no later than 90 days after the occurrence of such Change of
Control) at a redemption price equal to the principal amount of the Series
A Notes redeemed plus the Applicable Premium for Series A Notes as of, and
accrued and unpaid interest, if any, to the date of redemption, subject to
the rights of Holders on the relevant record date to receive interest on
the relevant interest payment date. This optional redemption by the Company
is separate from and in addition to the rights of Holders as set forth in
Section 4.15 hereof.
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(3) On or after July 15, 2006, the Company may redeem all or a part
of the Series A Notes upon not less than 30 nor more than 60 days notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest on the Series A Notes
redeemed, to the applicable redemption date, if redeemed during the
twelve-month period beginning on July 15 of the years indicated below,
subject to the rights of Holders on the relevant record date to receive
interest on the relevant interest payment date:
Year Percentage
---- ----------
2006 .................................................... 103.000%
2007 .................................................... 101.000%
2008 .................................................... 100.000%
(b) Series B Notes.
(1) At any time prior to July 15, 2006, the Company may on any one or
more occasions redeem up to 35% of the aggregate principal amount of the
Series B Notes issued hereunder at a redemption price of 109.875% of the
principal amount, plus accrued and unpaid interest to the redemption date,
with a contribution to the Company's common equity capital made with the
net cash proceeds of a concurrent sale of common stock of Dynegy; provided
that:
(A) at least 65% of the aggregate principal amount of the Series
B Notes issued hereunder (excluding Notes held by the Company or any
of its Affiliates) remains outstanding immediately after the
occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
(2) At any time prior to July 15, 2007, the Company may redeem all
but not less than all of the Series B Notes upon the occurrence of a Change
of Control, upon not less than 30 nor more than 60 days prior notice (but
in any event no earlier than the date of consummation of such Change of
Control and no later than 90 days after the occurrence of such Change of
Control) at a redemption price equal to the principal amount of the Series
B Notes redeemed plus the Applicable Premium for Series B Notes as of, and
accrued and unpaid interest, if any, to the date of redemption, subject to
the rights of Holders on the relevant record date to receive interest on
the relevant interest payment date. This optional redemption by the Company
is separate from and in addition to the rights of Holders as set forth in
Section 4.15 described hereof.
(3) On or after July 15, 2007, the Company may redeem all or a part
of the Series B Notes upon not less than 30 nor more than 60 days notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest on the Series B Notes
redeemed, to the applicable redemption date, if redeemed during the
twelve-month period beginning on July 15 of the years indicated below,
subject to the rights of Holders on the relevant record date to receive
interest on the relevant interest payment date:
Year Percentage
---- ----------
2007..................................................... 104.938%
2008..................................................... 102.469%
2009 and thereafter...................................... 100.000%
(c) Series C Notes.
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(1) At any time prior to July 15, 2006, the Company may on any one or
more occasions redeem up to 35% of the aggregate principal amount of the
Series C Notes issued hereunder at a redemption price of 110.125% of the
principal amount, plus accrued and unpaid interest to the redemption date,
with a contribution to the Company's common equity capital made with the
net cash proceeds of a concurrent sale of common stock of Dynegy; provided
that:
(A) at least 65% of the aggregate principal amount of the Series
C Notes issued hereunder (excluding Notes held by the Company or any
of its Affiliates) remains outstanding immediately after the
occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
(2) At any time prior to July 15, 2008, the Company may redeem all
but not less than all of the Series C Notes upon the occurrence of a Change
of Control, upon not less than 30 nor more than 60 days prior notice (but
in any event no earlier than the date of consummation of such Change of
Control and no later than 90 days after the occurrence of such Change of
Control) at a redemption price equal to the principal amount of the Series
C Notes redeemed plus the Applicable Premium for Series C Notes as of, and
accrued and unpaid interest, if any, to the date of redemption, subject to
the rights of Holders on the relevant record date to receive interest on
the relevant interest payment date. This optional redemption by the Company
is separate from and in addition to the rights of Holders as set forth in
Section 4.15 described hereof.
(3) On or after July 15, 2008, the Company may redeem all or a part
of the Series C Notes upon not less than 30 nor more than 60 days notice,
at the redemption prices (expressed as percentages of principal amount) set
forth below plus accrued and unpaid interest on the Series C Notes
redeemed, to the applicable redemption date, if redeemed during the
twelve-month period beginning on July 15 of the years indicated below,
subject to the rights of Holders on the relevant record date to receive
interest on the relevant interest payment date:
Year Percentage
---- ----------
2008..................................................... 105.063%
2009..................................................... 103.375%
2010..................................................... 101.688%
2011 and thereafter...................................... 100.000%
(d) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof. Unless the Company defaults
in the payment of the redemption price, interest shall cease to accrue on the
Notes or portions thereof called for redemption on the applicable redemption
date.
Section 3.08 Mandatory Redemption.
The Company is not required to make mandatory redemption or sinking fund
payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company is required
to commence an offer to all Holders to purchase Notes (an "Asset Sale Offer"),
it shall follow the procedures specified below.
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The Asset Sale Offer shall be made to all Holders and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in this Indenture with respect to offers to purchase or redeem
with the proceeds of sales and assets. The Asset Sale Offer shall remain open
for a period of at least 20 Business Days following its commencement and not
more than 30 Business Days, except to the extent that a longer period is
required by applicable law (the "Offer Period"). No later than three Business
Days after the termination of the Offer Period (the "Purchase Date"), the
Company shall apply all Excess Proceeds (the "Offer Amount") to the purchase of
Notes and such other pari passu Indebtedness (on a pro rata basis, if
applicable) or, if less than the Offer Amount has been tendered, all Notes and
other pari passu Indebtedness tendered in response to the Asset Sale Offer.
Payment for any Notes so purchased shall be made in the same manner as interest
payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The notice, which shall govern the terms of the Asset Sale Offer, shall
state:
(1) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer
shall remain open;
(2) the Offer Amount, the purchase price and the Purchase Date;
(3) that any Note not tendered or accepted for payment shall continue
to accrue interest;
(4) that, unless the Company defaults in making such payment, any
Note accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest after the Purchase Date and the only remaining right of the
Holders of such Notes is to receive payment on the Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may elect to have Notes purchased in integral multiples of
$1,000 only;
(6) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a
Depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives,
not later than the expiration of the Offer Period, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note
purchased;
(8) that, if the aggregate principal amount of Notes and other pari
passu Indebtedness surrendered by Holders exceeds the Offer Amount, the
Company shall select the Notes and other
56
pari passu Indebtedness to be purchased on a pro rata basis based on the
principal amount of Notes and such other pari passu Indebtedness
surrendered (with such adjustments as may be deemed appropriate by the
Company so that only Notes in denominations of $1,000, or integral
multiples thereof, shall be purchased); and
(9) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and
shall deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as
the case may be, shall promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Company for purchase, and the Company shall promptly issue a new Note, and the
Trustee, upon written request from the Company shall authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes.
The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 10:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02 Maintenance of Office or Agency.
The Company shall maintain in the City of Wilmington, Delaware (or if not
such location, in the Borough of Manhattan, the City of New York) an office or
agency (which may be an office of the Trustee or an affiliate of the Trustee,
Registrar or co-registrar) where Notes may be surrendered for registration of
transfer or for exchange and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the
57
location, and any change in the location, of such office or agency. If at any
time the Company fails to maintain any such required office or agency or fails
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the City of Wilmington,
Delaware (or if not such location, in the Borough of Manhattan, the City of New
York) for such purposes. The Company shall 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 designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03 hereof.
Section 4.03 Reports.
(a) Whether or not required by the rules and regulations of the SEC, so
long as any Notes are outstanding, the Company shall furnish to the Holders, or
cause the Trustee to furnish to the Holders of Notes, within the time periods
specified in the SEC's rules and regulations:
(1) all quarterly and annual reports that would be required to be
filed with the SEC on Forms 10-Q and 10-K if the Company were required to
file such reports; and
(2) all current reports that would be required to be filed with the
SEC on Form 8-K if the Company were required to file such reports.
All such reports shall be prepared in all material respects in accordance
with all of the rules and regulations applicable to such reports. Each annual
report on Form 10-K will include a report on the Company's consolidated
financial statements by the Company's certified independent accountants. The
Company shall file a copy of each of the reports referred to in clauses (1) and
(2) above with the SEC for public availability within the time periods specified
in the rules and regulations applicable to such reports (unless the SEC will not
accept such a filing) and will post the reports on its website within those time
periods.
(b) If, at any time, the Company is no longer subject to the periodic
reporting requirements of the Exchange Act for any reason, the Company will
nevertheless continue filing the reports specified in Section 4.03(a) with the
SEC within the time periods specified in the SEC's rules and regulations unless
the SEC will not accept such a filing. The Company agrees that it will not take
any action for the purpose of causing the SEC not to accept any such filings.
If, notwithstanding the foregoing, the SEC will not accept the Company's filings
for any reason, the Company will post the reports referred to in Section 4.03(a)
on its website within the time periods that would apply if the Company were
required to file those reports with the SEC. The Company shall at all times
comply with TIA Section 314(a).
(c) For so long as any Notes remain outstanding, at any time the Company
and the Affiliate Guarantors are not required to file the reports required by
4.03(a) and 4.03(b) with the SEC, the Company and the Affiliate Guarantors shall
furnish to the Holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
58
Section 4.04 Compliance Certificate.
(a) The Company and each Guarantor (to the extent that such Guarantor is
so required under the TIA) shall deliver to the Trustee, within 120 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture and the Security Documents, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company or such Guarantor has kept, observed, performed
and fulfilled each and every covenant contained in this Indenture and the
Security Documents and no Default or Event of Default has occurred during such
year and at the date of such certificate there is no Default or Event of Default
(or, if a Default or Event of Default has occurred, describing all such Defaults
or Events of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto) and that to the best
of his or her knowledge no event has occurred and remains in existence by reason
of which payments on account of the principal of or interest, if any, on the
Notes is prohibited or if such event has occurred, a description of the event
and what action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof insofar as they relate to
accounting matters or, if any such violation has occurred, specifying the nature
and period of existence thereof, it being understood that such accountants shall
not be liable directly or indirectly to any Person for any failure to obtain
knowledge of any such violation.
(c) So long as any of the Notes are outstanding, the Company shall deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default, an Officers' Certificate specifying such Default or Event of
Default and what action the Company is taking or proposes to take with respect
thereto.
Section 4.05 Taxes.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company and
each of the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power hereof granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.
59
Section 4.07 Restricted Payments.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of the Company's Equity Interests (including,
without limitation, any payment in connection with any merger or
consolidation involving the Company) or to the direct or indirect holders
of the Company's Equity Interests in their capacity as such (other than
dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Company);
(2) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or
consolidation involving the Company) any Equity Interests of the Company or
any direct or indirect parent of the Company held by any Person (other than
a Restricted Subsidiary of the Company);
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Indebtedness of the
Company or any Restricted Subsidiary that is contractually subordinated to
the Notes or any Note Guarantee (excluding any intercompany Indebtedness
between or among the Company and any of its Restricted Subsidiaries and
excluding the purchase, repurchase or other acquisition of any subordinated
Indebtedness purchased in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due
within one year of the date of acquisition), except a payment of interest
or principal at the Stated Maturity thereof; or
(4) make any Restricted Investment;
(all such payments and other actions set forth in these clauses (1)
through (4) above being collectively referred to as "Restricted Payments"
for purposes of this covenant), unless, at the time of and after giving
effect to such Restricted Payment:
(1) no Default or Event of Default has occurred and is continuing or
would occur as a consequence of such Restricted Payment; and
(2) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable four-quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in Section 4.09(a) hereof;
and
(3) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries since the date of this Indenture (excluding Restricted
Payments permitted by clauses (2), (3), (5), (6), (7), (8), (9), (10), (11)
and (12) of Section 4.07(b)), is less than the sum, without duplication,
of:
(A) 50% of the Consolidated Net Income of the Company for the
period (taken as one accounting period) from July 1, 2003 to the end
of the Company's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit), plus
60
(B) 100% of the aggregate net cash proceeds received by the
Company since the date of this Indenture as a contribution to its
common equity capital from the concurrent issue or sale of (1) Dynegy
Equity Interests (other than Disqualified Stock) or (2) convertible or
exchangeable Disqualified Stock of Dynegy or convertible or
exchangeable debt securities of Dynegy that have been converted into
or exchanged for Equity Interests (other than Disqualified Stock) of
Dynegy (other than Equity Interests (or Disqualified Stock or debt
securities) sold to a Subsidiary of Dynegy), plus
(C) to the extent that any Restricted Investment that was made
after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (1) the cash return with
respect to such Restricted Investment (less the cost of disposition,
if any) and (2) the initial amount of such Restricted Investment, plus
(D) to the extent that any Unrestricted Subsidiary of the
Company designated as such after the date of this Indenture is
redesignated as a Restricted Subsidiary after the date of this
Indenture, the Fair Market Value of the Company's Investment in such
Subsidiary as of the date of such redesignation, plus
(E) 50% of any dividends received by the Company or any of its
Restricted Subsidiaries after the date of this Indenture from an
Unrestricted Subsidiary of the Company, to the extent that such
dividends were not otherwise included in Consolidated Net Income of
the Company for such period.
(b) The provisions of Section 4.07(a) shall not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration of the dividend, if at the date of declaration the dividend
payment would have complied with the provisions of this Indenture;
(2) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, the making of any Restricted Payment
in exchange for, or out of the net cash proceeds of the substantially
concurrent sale (other than to a Subsidiary of the Company) of, Equity
Interests of the Company (other than Disqualified Stock) or from the
substantially concurrent contribution of common equity capital to the
Company; provided that the amount of any such net cash proceeds that are
utilized for any such Restricted Payment shall be excluded from clause
(3)(b) of the Section 4.07(a);
(3) the defeasance, redemption, repurchase or other acquisition of
Indebtedness of the Company or any of its Restricted Subsidiaries that is
contractually subordinated to the Notes or to any Note Guarantee in
exchange for or with the net cash proceeds from a substantially concurrent
(a) incurrence of Permitted Refinancing Indebtedness or issuance of Equity
Interests (other than Disqualified Stock) of the Company or (b)
contribution to the capital of the Company or any of its Restricted
Subsidiaries of proceeds from the incurrence of Indebtedness of Dynegy
(excluding Indebtedness that is Guaranteed by the Company or any of its
Restricted Subsidiaries) or issuance of Equity Interests of Dynegy;
(4) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, from time to time, the payment of
dividends in cash to Dynegy to repurchase, redeem or otherwise acquire or
retire for value, any Equity Interests of Dynegy or any Restricted
Subsidiary of Dynegy held by any current or former officer, director or
employee of Dynegy or any of its Restricted Subsidiaries pursuant to any
equity subscription agreement, stock option
61
agreement, shareholders' agreement, employee benefit plan or similar
agreement; provided that the aggregate price paid for all such repurchased,
redeemed, acquired or retired Equity Interests in any twelve-month period
shall not exceed $1.0 million; provided further, that any amounts not used
in any twelve-month period may be carried forward, in an amount not to
exceed $1.0 million, to the following twelve-month period.
(5) the repurchase of Equity Interests deemed to occur upon the
exercise of stock options to the extent such Equity Interests represent a
portion of the exercise price of those stock options;
(6) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, the declaration and payment of
regularly scheduled or accrued dividends to holders of any class or series
of Disqualified Stock of the Company or any Restricted Subsidiary of the
Company issued on or after the date of this Indenture in accordance with
the Fixed Charge Coverage test set forth in Section 4.09(a) hereof;
(7) Permitted Payments to Parents;
(8) distributions to Dynegy in an aggregate amount not to exceed
$225.0 million, which funds shall be used by Dynegy to make a cash payment
to Chevron (or any of its Related Parties) upon consummation of the Series
B Restructuring Transaction; provided that such payment shall occur within
60 days of the date of this Indenture;
(9) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, distributions in cash to Dynegy
equal to or less than regularly scheduled interest payments on the IP
Intercompany Note as the same is in effect on the date of this Indenture;
provided that the Company may fund pre-payments of up to twelve months of
interest (but in no event shall more than twelve months of interest be
pre-paid at any time);
(10) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, distributions in cash to Dynegy (A)
to fund payment or prepayment of principal on the IP Intercompany Note, (B)
to fund, upon contemporaneous contribution by Dynegy, directly or
indirectly, to Illinois Power, capital expenditures and operating expenses
in the ordinary course of business of Illinois Power or (C) to fund
payments of interest and principal on the Illinova Senior Notes; provided
that (1) the aggregate amount of all such cash distributions does not
exceed $450.0 million since the date of this Indenture or (2) the Fixed
Charge Coverage Ratio for the Company's most recently ended four full
fiscal quarters for which financial statements are publicly available
immediately preceding the date on which such distribution is to be made
would have been at least 2.0 to 1;
(11) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, distributions in cash to Dynegy
equal to or less than (A) regularly scheduled payments of interest and (B)
any mandatory prepayments, in each case, then due on the DYN Notes;
provided, however, that in the case of clause (A) above, at any time after
the second anniversary of date of this Indenture, distributions under this
clause (11)(A) shall be permitted only if the Fixed Charge Coverage Ratio
for the Company's most recently ended four full fiscal quarters for which
financial statements are publicly available immediately preceding the date
on which such distribution is to be made would have been at least 2.0 to 1,
determined on a pro forma basis giving effect to such distribution and
including in Fixed Charges as Consolidated Interest Expense of the Company
such distribution and all other distributions made pursuant to this clause
(11)(A) during the relevant four-quarter period;
62
(12) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, distributions in cash to Dynegy
equal to or less than regularly scheduled dividend payments in respect of
the DYN Preferred; provided, however, that at any time after the second
anniversary of the date of this Indenture, distributions under this clause
(12) shall be permitted only if the Fixed Charge Coverage Ratio for the
Company's most recently ended four full fiscal quarters for which financial
statements are publicly available immediately preceding the date on which
such distribution is to be made would have been at least 2.0 to 1,
determined on a pro forma basis giving effect to such distribution and
including in Fixed Charges as Consolidated Interest Expense of the Company
such distribution and all other distributions made pursuant to clause
(11)(A) and this clause (12) during the relevant four-quarter period;
(13) any purchase, redemption, defeasance or other acquisition or
retirement for value of subordinated Indebtedness upon a Change of Control
or an Asset Sale to the extent required by this Indenture or other
agreements pursuant to which such subordinated Indebtedness was issued, but
only if the Company (A) in the case of a Change of Control, has consummated
a Change of Control Offer pursuant to Section 4.15 hereof or (B) in the
case of an Asset Sale, has consummated an Asset Sale Offer pursuant to
Section 4.10 hereof; and
(14) so long as no Default or Event of Default has occurred and is
continuing or would be caused thereby, other Restricted Payments in an
aggregate amount not to exceed $50.0 million since the date of this
Indenture.
The amount of all Restricted Payments (other than cash) shall be the Fair
Market Value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by the Company or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Payment. If the Fair
Market Value of any assets or securities that are required to be valued by this
covenant exceeds $50.0 million, then such Fair Market Value shall be determined
by the Board of Directors whose resolution with respect thereto shall be
delivered to the Trustee. For the avoidance of doubt, the Company or any of its
Restricted Subsidiaries may pay (either directly or indirectly by making
payments to Dynegy) interest on or principal at Stated Maturity of Indebtedness
of Dynegy, including the Convertible Debentures and any other convertible
subordinated debt securities of Dynegy, so long as the Company or its Restricted
Subsidiaries have Guaranteed such Indebtedness and the Guarantee was permitted
to be incurred pursuant to Section 4.09 hereof. Payments by the Company or any
of its Restricted Subsidiaries in respect of such Guaranteed Dynegy debt
securities shall not constitute Restricted Payments. Any loans, dividends or
advances from the Company or any of its Restricted Subsidiaries to Dynegy, for
purposes of this Section 4.07, shall be determined to be a "distribution."
(c) Restricted Payment to and from Illinova.
(1) To the extent that Illinova receives any distributions from
Illinois Power, (i) Illinova shall distribute all such distributions
received to Dynegy and (ii) except for Dynegy's express ability to retain
Permitted Payments to Parents, Dynegy shall contemporaneously contribute
all such distributions to the Company; provided that the obligation of
Illinova to make any distributions pursuant to clause (i) above and the
obligation of Dynegy to make any contributions pursuant to clause (ii)
above, in each case, shall be limited in an aggregate principal amount to
distributions made by the Company in reliance on Section 4.07(b)(10)
hereof.
(2) Notwithstanding the foregoing:
(A) if Illinova distributes Net Proceeds from any Asset Sale to
Dynegy, in lieu of Section 4.07(c)(1), Dynegy may first apply such Net
Proceeds in accordance Section 4.10
63
hereof; provided however, that to the extent the Company has made
distributions to Dynegy in reliance on Section 4.07(b)(10) that have
not been otherwise contributed by Dynegy to the Company pursuant to
the immediately preceding paragraph and Dynegy elects to apply any Net
Proceeds in accordance with Section 4.10(b)(5) hereof, such proceeds
shall be invested to make capital expenditures at the Company or
investments in Replacement Assets to be held by the Company;
(B) Illinova may make Permitted Payments to Parents and Dynegy
shall not be required to contribute such amounts to the Company
pursuant to clause (ii) of Section 4.07(c)(1); and
(C) Illinova shall not be required to make any distribution
pursuant to clause (i) of Section 4.07(c)(1) and Dynegy shall not be
required to make any contributions pursuant to clause (ii) of Section
4.07(c)(1), in each case to the extent prohibited by law.
(3) None of Dynegy or any of its Subsidiaries (other than Illinova
and its Subsidiaries) shall (1) enter into any contract, agreement, loan,
advance, guarantee, lease, license or similar arrangement with or in favor
of any Subsidiary of Illinova (other than such agreements (x) as are in
effect as of the date of this Indenture and as the same may be amended,
restated, renewed, replaced, supplemented or otherwise modified in the
ordinary course of business and (y) as may be entered into after the date
of this Indenture provided that they are made in the ordinary course of
business consistent (in scope, character and amount) with past practice and
are on terms no less favorable to Dynegy or the Company and its Restricted
Subsidiaries, as applicable, that would have been obtained in an arm's
length transaction with an unrelated Person (collectively, the "Permitted
Illinova Subsidiary Contracts")) or (2) accept any payment or distribution
of any kind from any Subsidiary of Illinova unless such distribution or
payment is (a) paid or distributed to Dynegy, the Company or its Restricted
Subsidiaries through Illinova or (b) made pursuant to the Permitted
Illinova Subsidiary Contracts or (c) a Permitted Payment to Parents;
provided, however, that this paragraph shall not restrict transactions
between or among (i) Dynegy or the Company and its Restricted Subsidiaries
on the one hand and Illinova (but not its Subsidiaries) on the other hand
(subject to compliance with the other provisions of this Indenture
including without limitation, Section 4.07(a)), (ii) Illinova and its
Subsidiaries or (iii) any Subsidiaries of Illinova.
Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its Capital
Stock to the Company or any of its Restricted Subsidiaries, or with respect
to any other interest or participation in, or measured by, its profits, or
pay any indebtedness owed to the Company or any of its Restricted
Subsidiaries;
(2) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(3) transfer any of its properties or assets to the Company or any of
its Restricted Subsidiaries.
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(b) The preceding restrictions in Section 4.08(a) shall not apply to
encumbrances or restrictions existing under or by reason of:
(1) agreements governing (a) Existing Indebtedness, (b)
Proportionally Consolidated Interests, (c) Investments by the Company or
its Restricted Subsidiaries in Affiliates and third parties, (d) or other
agreements of a similar nature, in each case as in effect on the date of
this Indenture and any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of those
agreements; provided that the amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacement or refinancings
are not materially more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in those
agreements on the date of this Indenture;
(2) the Credit Facilities as in effect on the date of this Indenture
and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of those agreements;
provided that the amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacement or refinancings are not
materially more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in those
agreements on the date of this Indenture;
(3) this Indenture, the Notes, the Guarantees and the Security
Documents;
(4) applicable law, rule, regulation or order;
(5) customary encumbrances and restrictions (including, without
limitation, non-assignment provisions) in contracts, agreements, leases,
permits and licenses entered into or issued in the ordinary course of
business that are not materially more restrictive, taken as whole, than
those existing on the date of this Indenture;
(6) purchase money obligations for property acquired in the ordinary
course of business and Capital Lease Obligations that impose restrictions
on the property purchased or leased of the nature described in clause (3)
of Section 4.08(a);
(7) any agreement for the sale or other disposition of a Restricted
Subsidiary that restricts distributions by that Restricted Subsidiary
pending the sale or other disposition;
(8) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are not materially more restrictive, taken as a
whole, than those contained in the agreements governing the Indebtedness
being extended, refinanced, renewed, replaced, defeased or refunded;
(9) Liens permitted to be incurred under Section 4.12 hereof that
limit the right of the debtor to dispose of the assets subject to such
Liens;
(10) provisions limiting or prohibiting the disposition or
distribution of assets or property in joint venture agreements, asset sale
agreements, sale-leaseback agreements, stock sale agreements and other
similar agreements entered into in the ordinary course of business;
provided that such limitation or prohibition is applicable only to the
assets that are the subject of such agreement;
65
(11) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business;
(12) restrictions or conditions contained in any trading, netting,
operating, construction, service, supply, purchase, sale or similar
agreement to which the Company or any Restricted Subsidiary of the Company
is a party entered into in the ordinary course of business; provided that
such agreement limits the encumbrance of solely the property or assets of
the Company or such Restricted Subsidiary that are the subject of such
agreement, the payment rights arising thereunder and/or the proceeds
thereof and not to any other asset or property of the Company or such
Restricted Subsidiary or the assets or property of any other Restricted
Subsidiary;
(13) Indebtedness of a Restricted Subsidiary of the Company existing
at the time it became a Restricted Subsidiary if such restriction was not
created in connection with or in anticipation of the transaction or series
of transactions pursuant to which such Restricted Subsidiary became a
Restricted Subsidiary or was acquired by the Company;
(14) with respect to clause (3) of Section 4.08(a) only, restrictions
encumbering property at the time such property was acquired by the Company
or any of its Restricted Subsidiaries, so long as such restriction relates
solely to the property so acquired and was not created in connection with
or in anticipation of such acquisition;
(15) an agreement governing Indebtedness permitted to be incurred
pursuant to Section 4.09 hereof; provided that the provisions relating to
such encumbrance or restriction contained in such Indebtedness, taken as a
whole, are not materially more restrictive than those contained in this
Indenture; and
(16) customary net worth and restrictions on transfer, assignment or
subletting provisions contained in leases and other agreements entered into
by the Company or any Restricted Subsidiary in the ordinary course of
business.
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Stock.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Indebtedness (including Acquired
Debt), and the Company shall not issue any Disqualified Stock and shall not
permit any of its Restricted Subsidiaries to issue any shares of preferred
stock; provided, however, that the Company may incur Indebtedness (including
Acquired Debt) or issue Disqualified Stock, and the Restricted Subsidiaries may
incur Indebtedness or issue preferred stock, if the Fixed Charge Coverage Ratio
for the Company's most recently ended four full fiscal quarters for which
financial statements are publicly available immediately preceding the date on
which such additional Indebtedness is incurred or such Disqualified Stock or
preferred stock is issued would have been at least 2.0 to 1, determined on a pro
forma basis (including a pro forma application of the net proceeds therefrom),
as if the additional Indebtedness had been incurred or the Disqualified Stock or
preferred stock had been issued, as the case may be, at the beginning of such
four-quarter period.
(b) The provisions of Section 4.09(a) hereof shall not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness and letters of credit under Credit
Facilities in an aggregate principal amount at any
66
one time outstanding under this clause (1) (with letters of credit being
deemed to have a principal amount equal to the maximum potential liability
of the Company and its Restricted Subsidiaries thereunder), not to exceed
$2,078.0 million less the aggregate amount of all Net Proceeds of Asset
Sales applied by the Company, any of its Restricted Subsidiaries or by any
Affiliate Guarantor since the date of this Indenture to repay any term
Indebtedness under a Credit Facility or to repay any revolving credit
Indebtedness under a Credit Facility and effect a corresponding commitment
reduction thereunder pursuant to clause (1) of Section 4.10(a) hereof;
(2) the incurrence by the Company and its Restricted Subsidiaries of
the Existing Indebtedness;
(3) the incurrence by the Company and the Restricted Subsidiaries of
Indebtedness represented by the Initial Notes and the Note Guarantees to be
issued on the date of this Indenture;
(4) the incurrence by the Company of the Guarantee of the Convertible
Debentures;
(5) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by Capital Lease Obligations,
mortgage financings or purchase money obligations, in each case, incurred
for the purpose of financing all or any part of the purchase price or cost
of design, construction, installation or improvement of property, plant or
equipment used in the business of the Company or any of its Restricted
Subsidiaries, in an aggregate principal amount (or accreted value, as
applicable), including all Permitted Refinancing Indebtedness incurred to
refund, refinance, replace, defease or discharge any Indebtedness incurred
pursuant to this clause (5), not to exceed $100.0 million at any time
outstanding;
(6) the incurrence by the Company or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the
net proceeds of which are used to refund, refinance, replace, defease or
discharge Indebtedness (other than intercompany Indebtedness) that was
permitted by this Indenture to be incurred under Section 4.09(a) or clause
(2), (3), (4), (5), (6), (15)(a), (16) or (19) of this Section 4.09(b);
(7) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company and
any of its Restricted Subsidiaries or between the Company or any of its
Restricted Subsidiaries on the one hand and Dynegy on the other hand;
provided, however, that:
(A) if the Company or any Guarantor is the obligor on such
Indebtedness and the payee is not the Company or a Guarantor, such
Indebtedness must be expressly subordinated to the prior payment in
full in cash of all Obligations then due with respect to the Notes, in
the case of the Company, or the Guarantee, in the case of a Guarantor;
and
(B) (x) any subsequent issuance or transfer of Equity Interests
that results in any such Indebtedness being held by a Person other
than the Company, a Restricted Subsidiary of the Company or Dynegy and
(y) any sale or other transfer of any such Indebtedness to a Person
that is not the Company, a Restricted Subsidiary of the Company or
Dynegy, shall be deemed, in each case, to constitute an incurrence of
such Indebtedness by the Company or such Restricted Subsidiary, as the
case may be, that was not permitted by this clause (7);
67
(8) the issuance by any of the Company's Restricted Subsidiaries to
the Company or to any of its Restricted Subsidiaries of shares of preferred
stock; provided, however, that:
(A) any subsequent issuance or transfer of Equity Interests that
results in any such preferred stock being held by a Person other than
the Company or a Restricted Subsidiary of the Company; and
(B) any sale or other transfer of any such preferred stock to a
Person that is not either the Company or a Restricted Subsidiary of
the Company;
shall be deemed, in each case, to constitute an issuance of such preferred
stock by such Restricted Subsidiary that was not permitted by this clause
(8);
(9) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations;
(10) the Guarantee by the Company or any of its Restricted
Subsidiaries of Indebtedness of the Company or a Restricted Subsidiary of
the Company that was permitted to be incurred by another provision of this
covenant; provided that if the Indebtedness being guaranteed is
subordinated to or pari passu with the Notes, then the Guarantee shall be
subordinated to the same extent as the Indebtedness guaranteed;
(11) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness in respect of workers' compensation claims,
self-insurance obligations, bankers' acceptances, performance and surety
bonds in the ordinary course of business;
(12) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
drawn against insufficient funds, so long as such Indebtedness is covered
within five Business Days;
(13) the incurrence of Indebtedness arising from agreements of the
Company or a Restricted Subsidiary, providing for indemnification,
adjustment of purchase price or similar obligations, in each case, incurred
or assumed in connection with the disposition of any business, assets or
Equity Interests of a Subsidiary; provided that the maximum aggregate
liability in respect of all such Indebtedness shall at no time exceed the
gross proceeds (including non-cash proceeds) actually received by the
Company and/or such Restricted Subsidiary in connection with such
disposition;
(14) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness in connection with the deferred purchase price
of goods or services, or progress payments in connection with such goods
and services, including turbines, transformers and similar equipment, so
long as such obligations are incurred in the ordinary course of business;
(15) the incurrence of Indebtedness by the Company or any of its
Restricted Subsidiaries in connection with (a) Discontinued Business
Operations (other than in respect of tolling agreements, Litigation and the
wind-down, settlement or disposition of the customer risk management
business) of the Company and its Restricted Subsidiaries in an aggregate
principal amount (or accreted value, as applicable), including all
Permitted Refinancing Indebtedness incurred to refund, refinance, replace,
defease or discharge any Indebtedness incurred pursuant to this clause
(15), not to exceed $30.0 million at any time outstanding (provided that
any
68
Indebtedness created or incurred as a result of set off, cancellation,
assignment or similar transaction among or between Restricted Subsidiaries
that engage in Discontinued Business Operations, or among or between such
Restricted Subsidiaries and other Guarantors in connection with the
wind-down of the Discontinued Business Operations, shall not be included
when calculating the foregoing dollar limitation) and (b) Litigation;
(16) the incurrence of Indebtedness by Dynegy Midwest Generation, Inc.
or any other Restricted Subsidiary of the Company in satisfaction of the
obligations of Illinois Power pursuant to the Xxxxxx Lease, including the
incurrence of any obligation to pay "Rent" or the "Purchase Amount" (each
as defined in the Xxxxxx Lease) in an aggregate principal amount, including
all Permitted Refinancing Indebtedness incurred to refund, refinance,
replace, defease or discharge any Indebtedness incurred pursuant to this
clause (16), not to exceed at any time outstanding $81.0 million less any
amounts invested pursuant to clause (17) of the definition of "Permitted
Investments";
(17) the incurrence of Indebtedness by the Company or any of its
Restricted Subsidiaries owed to CoGen Lyondell, Inc. or DGPI Inc. to pay
costs and expenses, so long as such Indebtedness is incurred in the
ordinary course of business consistent with past practices;
(18) the incurrence of Indebtedness by the Company or any of its
Restricted Subsidiaries in the form of loans from an insurance company or
insurance premium finance company to finance all or any portion of the
premium of any insurance policy maintained by the Company or any of its
Restricted Subsidiaries, so long as such insurance policy is written in the
ordinary course of business and names Dynegy or any of its Restricted
Subsidiaries as a named beneficiary thereunder; and
(19) the incurrence by the Company or any of its Restricted
Subsidiaries of additional Indebtedness in an aggregate principal amount
(or accreted value, as applicable) at any time outstanding pursuant to this
clause (19), including all Permitted Refinancing Indebtedness incurred to
refund, refinance, replace, defease or discharge any Indebtedness incurred
pursuant to this clause (19), not to exceed $100.0 million.
(c) The Company shall not incur, and shall not permit any Guarantor to
incur, any Indebtedness (including Permitted Debt) that is contractually
subordinated in right of payment to any other Indebtedness of the Company or
such Guarantor unless such Indebtedness is also contractually subordinated in
right of payment to the Notes and the applicable Guarantee on substantially
identical terms; provided, however, that no Indebtedness shall be deemed to be
contractually subordinated in right of payment to any other Indebtedness of the
Company solely by virtue of being unsecured or by virtue of being secured on a
parity or junior Lien basis.
(d) For purposes of determining compliance with this Section 4.09, in the
event that an item of proposed Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (1) through (19) above,
or is entitled to be incurred pursuant to Section 4.09(a), the Company shall be
permitted to classify such item of Indebtedness on the date of its incurrence,
or later reclassify all or a portion of such item of Indebtedness, in any manner
that complies with this Section 4.09. Indebtedness under the Credit Agreement
and the Subsidiary Facilities outstanding on the date on which Notes are first
issued and authenticated under this Indenture shall initially be deemed to have
been incurred on such date in reliance on the exception provided by clause (1)
of Section 4.09(b). Indebtedness permitted by this Section 4.09 need not be
permitted solely by reference to one provision permitting such Indebtedness but
may be permitted in part by one such provision and in part by one or more other
provisions of this covenant permitting such Indebtedness. Guarantees of, or
obligations in
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respect of letters of credit relating to, Indebtedness which is otherwise
included in the determination of a particular amount of Indebtedness of the
Company or its Restricted Subsidiaries shall not be included. If Obligations in
respect of letters of credit are incurred pursuant to the Credit Agreement and
are being treated as incurred pursuant to clause (1) of Section 4.09(b) and such
letters of credit relate to other Indebtedness of the Company or its Restricted
Subsidiaries, then such other Indebtedness of the Company or its Restricted
Subsidiaries shall not be included. The accrual of interest, the accretion or
amortization of original issue discount, the payment of interest on any
Indebtedness in the form of additional Indebtedness with the same terms, and the
payment of dividends on Disqualified Stock in the form of additional shares of
the same class of Disqualified Stock shall not be deemed to be an incurrence of
Indebtedness or an issuance of Disqualified Stock for purposes of this Section
4.09; provided, in each such case, that the amount thereof is included in Fixed
Charges of the Company as accrued. Indebtedness shall exclude other obligations
of the Company or any Restricted Subsidiary in existence on the date of this
Indenture that were not included as liabilities or Indebtedness on the
consolidated balance sheet of the Company at the time such obligation was
entered into and subsequently recast for accounting purposes. Notwithstanding
any other provision of this Section 4.09, the maximum amount of Indebtedness
that the Company or any Restricted Subsidiary may incur pursuant to this Section
4.09 shall not be deemed to be exceeded solely as a result of fluctuations in
exchange rates or currency values.
(e) The amount of any Indebtedness outstanding as of any date shall be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any
other Indebtedness; and
(3) in respect of Indebtedness of another Person secured by a Lien on
the assets of the specified Person, the lesser of:
(A) the Fair Market Value of such asset at the date of
determination, and
(B) the amount of the Indebtedness of the other Person.
Section 4.10 Asset Sales.
(a) Dynegy shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) Dynegy (or such Restricted Subsidiary, as the case may be)
receives consideration at the time of the Asset Sale at least equal to the
Fair Market Value of the assets or Equity Interests issued or sold or
otherwise disposed of (as reasonably determined by Dynegy or such
Restricted Subsidiary); and
(2) at least 75% of the consideration received in the Asset Sale by
Dynegy or such Restricted Subsidiary is in the form of:
(A) cash or Cash Equivalents; provided that for purposes of this
provision, each of the following shall be deemed to be cash:
(i) any liabilities, as shown on Dynegy's most recent
consolidated balance sheet, of Dynegy or any Restricted
Subsidiary (other than contingent liabilities and liabilities
that are by their terms subordinated to the Notes or any
70
Note Guarantee) that are assumed by the transferee of any such
assets pursuant to a customary novation agreement that releases
Dynegy or such Restricted Subsidiary from further liability; and
(ii) any securities, notes or other obligations received by
Dynegy or such Restricted Subsidiary from such transferee that
are converted (by sale or other disposition) by Dynegy or such
Restricted Subsidiary into cash, to the extent of the cash
received in that conversion within 60 days after such Asset Sale;
and
(iii) reasonable reserves for indemnity obligations and
purchase price adjustments funded in cash or held back by the
purchaser;
and/or
(B) Replacement Assets; provided that:
(i) the Fair Market Value of such Replacement Assets shall
be at least equal to the Fair Market Value of the assets sold or
otherwise disposed of and, in each case, the Fair Market Value
shall be evidenced by a resolution of the applicable Board of
Directors; and
(ii) if the assets or Equity Interests sold in the relevant
Asset Sale constituted part of the Collateral, then Dynegy or the
applicable Restricted Subsidiary shall use all commercially
reasonable efforts to grant as promptly as practicable a
second-priority Lien (subject to Liens securing Priority Lien
Debt and Permitted Liens) upon such Replacement Assets as
security for the Notes.
(b) Within 365 days after the receipt of any Net Proceeds from an Asset
Sale, Dynegy (or its Restricted Subsidiaries, as the case may be) may apply
those Net Proceeds:
(1) to repay Priority Lien Debt and, if the Priority Lien Debt repaid
is revolving credit Indebtedness, to correspondingly reduce commitments
with respect thereto;
(2) to repay Parity Lien Debt; provided that any offer to repay
Parity Lien Debt is made to all Holders and all holders of other Parity
Lien Debt on a pro rata basis;
(3) in the case of any Asset Sale that is not an Illinova Asset Sale,
to distribute up to 25% of the first $200.0 million of net proceeds from
such Asset Sale to Dynegy for use by Dynegy upon receipt thereof to repay
or repurchase all or any portion of the DYN Notes or any Obligations
thereunder; provided that this clause (3) shall cease to be available for
application of Net Proceeds after the Termination Date;
(4) in the case of an Illinova Asset Sale, to distribute up to 75% of
the Net Proceeds from such Asset Sale (but not to exceed the sum of (a)
$225.0 million and (b) the aggregate principal amount then outstanding of
DYN Notes issued since the date of this Indenture as payable-in-kind
interest on the DYN Notes, and accrued and unpaid interest, if any, on the
DYN Notes) to Dynegy for use by Dynegy upon receipt thereof to repay or
repurchase all or any portion of the DYN Notes or any Obligations
thereunder; provided that this clause (4) shall cease to be available for
application of Net Proceeds after the Termination Date; or
71
(5) to either (a) make a capital expenditure or (b) otherwise invest
in or acquire Replacement Assets; provided that if the assets or Equity
Interests sold in the relevant Asset Sale constituted part of the
Collateral, then Dynegy or the applicable Restricted Subsidiary shall use
all commercially reasonable efforts to promptly as practicable grant a
second-priority Lien (subject to Liens securing Priority Lien Debt and
Permitted Liens) upon such Replacement Assets as security for the Notes.
Pending the final application of any Net Proceeds, the Company shall
deposit the Net Proceeds into the Cash Collateral Account as part of the
Collateral to the extent required by the Security Documents. To the extent that
the Security Documents do not require the Net Proceeds to be so deposited, the
Company may temporarily reduce revolving credit borrowings under the Credit
Agreement.
(c) Any Net Proceeds from Asset Sales that are not applied or invested as
provided in the preceding paragraph shall constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $50.0 million or at such earlier
time as the Company may elect, the Company shall make an Asset Sale Offer to all
Holders and all holders of other Indebtedness that is pari passu with the Notes
containing provisions similar to those set forth in this Indenture with respect
to offers to purchase or redeem with the proceeds of sales of assets to purchase
the maximum principal amount of Notes and such other pari passu Indebtedness
that may be purchased out of the Excess Proceeds to the extent required by the
indentures governing other Indebtedness. The offer price in any Asset Sale Offer
shall be equal to 100% of principal amount plus accrued and unpaid interest to
the date of purchase, and shall be payable in cash. If any Excess Proceeds
remain after consummation of an Asset Sale Offer, such Excess Proceeds shall be
released from the Cash Collateral Account and the Company may use those Excess
Proceeds for any purpose not otherwise prohibited by this Indenture. If the
aggregate principal amount of Notes and other pari passu Indebtedness tendered
into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other pari passu Indebtedness to be purchased on
a pro rata basis. Upon completion of each Asset Sale Offer, the amount of Excess
Proceeds shall be reset at zero.
(d) The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with each
repurchase of notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with Section 3.09 or
this Section 4.10, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under
Section 3.09 or this Section 4.10 by virtue of such conflict.
Section 4.11 Transactions with Affiliates.
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate of the Company (each, an "Affiliate Transaction"), unless:
(1) the Affiliate Transaction is on terms that are no less favorable
(as reasonably determined by the Company) to the Company or the relevant
Restricted Subsidiary than those that would have been obtained in a
comparable transaction by the Company or such Restricted Subsidiary with an
unrelated Person; and
(2) the Company delivers to the Trustee:
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(A) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $25.0 million, a resolution of the Board of Directors set
forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with this covenant and that such Affiliate
Transaction has been approved by a majority of the disinterested
members of the Board of Directors; and
(B) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $100.0 million, an opinion as to the fairness to the Company
or such Subsidiary of such Affiliate Transaction from a financial
point of view issued by an accounting, appraisal or investment banking
firm of national standing.
(b) The following items shall not be deemed to be Affiliate Transactions
and, therefore, shall not be subject to the provisions of Section 4.11(a):
(1) any employment agreement, employee benefit plan, officer and
director indemnification agreement or any similar arrangement entered into
by the Company or any of its Restricted Subsidiaries in the ordinary course
of business or approved by the Company's Board of Directors;
(2) transactions between or among the Company and any of its
Restricted Subsidiaries or between Restricted Subsidiaries;
(3) transactions with a Person that is an Affiliate of the Company
solely because the Company owns, directly or through a Restricted
Subsidiary, an Equity Interest in, or controls, such Person;
(4) payment of reasonable directors' fees to Persons who are not
otherwise Affiliates of the Company;
(5) any issuance of Equity Interests (other than Disqualified Stock)
of the Company to Affiliates of the Company;
(6) Restricted Payments and Permitted Investments that do not violate
Section 4.07 hereof;
(7) Permitted Payments to Parents;
(8) commercial transactions in the ordinary course of business
between or among the Company and/or its Restricted Subsidiaries on the one
hand and Illinova and/or its Subsidiaries on the other hand;
(9) commercial transactions in the ordinary course of business
between or among the Company and/or its Restricted Subsidiaries on the one
hand and Chevron and its Related Parties on the other hand;
(10) loans or advances to executive officers and directors in the
ordinary course of business not to exceed $1.0 million in the aggregate
outstanding at any one time; and
(11) any agreement, instrument or arrangement as in effect as of the
date of this Indenture or any amendment thereto or any transaction
contemplated thereby (including pursuant
73
to any amendment thereto) or in any replacement agreement thereto so long
as any such amendment or replacement agreement is not more disadvantageous
to the Holders in any material respect than the original agreement as in
effect on the date of this Indenture as determined by the Company.
Section 4.12 Liens.
Dynegy shall not, and shall not permit any of its Restricted Subsidiaries
to, directly or indirectly, create, incur, assume or suffer to exist any Lien of
any kind on any asset now owned or hereafter acquired, except Permitted Liens.
Section 4.13 Business Activities.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in any business other than Permitted Businesses, except
to such extent as would not be material to the Company and its Restricted
Subsidiaries taken as a whole.
Section 4.14 Corporate Existence.
Except as otherwise permitted by Article 5 or Section 10.04 hereof, the
Company shall do or cause to be done all things necessary to preserve and keep
in full force and effect:
(1) its corporate existence, and the corporate, partnership or other
existence of each of its Restricted Subsidiaries, in accordance with the
respective organizational documents (as the same may be amended from time
to time) of the Company or any such Restricted Subsidiary; and
(2) the rights (charter and statutory), licenses and franchises of
the Company and its Restricted Subsidiaries;
provided, however, that the Company shall not be required to preserve any
such right, license or franchise, or the corporate, partnership or other
existence of any of its Restricted Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries, taken as a whole,
and that the loss thereof is not adverse in any material respect to the Holders
of the Notes.
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) If a Change of Control occurs, and unless the Company has exercised
its right to redeem the Notes pursuant to Section 3.07 hereof, the Company shall
make an offer (the "Change of Control Offer") to repurchase all or any part
(equal to $1,000 or an integral multiple of $1,000) of that Holder's Notes for a
payment in cash equal to 101% of the aggregate principal amount of Notes
repurchased plus accrued and unpaid interest, if any, on the Notes repurchased,
to the date of purchase, subject to the rights of Holders on the relevant record
date to receive interest due on the relevant interest payment date (the "Change
of Control Payment"). Within 30 days following any Change of Control, the
Company shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to repurchase
Notes on the Change of Control Payment Date specified in the notice, which date
shall be no earlier than 30 days and no later than 60 days from the date such
notice is mailed, stating,
(1) that the Change of Control Offer is being made pursuant to this
Section 4.15 and that all Notes tendered will be accepted for payment;
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(2) the purchase price and the purchase date, which shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed (the "Change of Control Payment Date");
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in the payment of the Change of
Control Payment, all Notes accepted for payment pursuant to the Change of
Control Offer will cease to accrue interest after the Change of Control
Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to a
Change of Control Offer will be required to surrender the Notes, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the third Business Day preceding the
Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes delivered for purchase, and a
statement that such Holder is withdrawing his election to have the Notes
purchased; and
(7) that Holders whose Notes are being purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof.
The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the notes as a result of a Change of Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.15 of this Indenture, the Company shall comply with
the applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 4.15 by virtue of such compliance.
(b) On the Change of Control Payment Date, the Company shall, to the
extent lawful:
(1) accept for payment all Notes or portions of Notes properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions of Notes properly
tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being purchased by
the Company.
The Paying Agent shall promptly mail to each Holder properly tendered the
Change of Control Payment for such Notes, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a new Note equal in principal amount to any unpurchased portion of the Notes
surrendered, if any; provided that each new Note shall be in a principal amount
of $1,000 or an integral multiple of $1,000. The Company shall publicly announce
the results of the Change of Control Offer on or as soon as practicable after
the Change of Control Payment Date.
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(c) Notwithstanding anything to the contrary in this Section 4.15, the
Company shall not be required to make a Change of Control Offer upon a Change of
Control if (1) a third party makes the Change of Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in this
Section 4.15 and purchases all Notes properly tendered and not withdrawn under
the Change of Control Offer, or (2) notice of redemption has been given pursuant
to Section 3.07 hereof unless and until there is a default in payment of the
applicable redemption price.
Section 4.16 Limitation on Sale and Leaseback Transactions.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, enter into any Sale and Leaseback Transaction; provided that
the Company or any Restricted Subsidiary may enter into a Sale and Leaseback
Transaction if:
(1) the Company or that Restricted Subsidiary, as applicable, could
have (a) incurred Indebtedness in an amount equal to the Attributable Debt
relating to such Sale and Leaseback Transaction under the Fixed Charge
Coverage Ratio test set forth in Section 4.09(a) hereof and (b) incurred a
Lien to secure such Indebtedness pursuant to Section 4.12 hereof;
(2) the gross cash proceeds of that Sale and Leaseback Transaction
are at least equal to the Fair Market Value, as determined in good faith by
the Board of Directors of the property that is the subject of that Sale and
Leaseback Transaction; and
(3) if such Sale and Leaseback Transaction constitutes an Asset Sale,
the transfer of assets in that Sale and Leaseback Transaction is permitted
by, and the Company applies the proceeds of such transaction in compliance
with, Section 4.10 hereof.
Section 4.17 Additional Note Guarantees.
If after the date of this Indenture, the Company or any of its Restricted
Subsidiaries acquires or creates another Domestic Subsidiary that is required to
become a guarantor of any borrowings under the Credit Facilities, then after the
date of this Indenture, that newly acquired or created Domestic Subsidiary will
become a Subsidiary Guarantor and execute a supplemental indenture and deliver
an opinion of counsel satisfactory to the Trustee within 60 days of the date on
which it was acquired or created; provided, that any Domestic Subsidiary that
constitutes an Immaterial Subsidiary need not become a Guarantor until such time
as it ceases to be an Immaterial Subsidiary.
Section 4.18 Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate
Fair Market Value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary designated as Unrestricted shall be
deemed to be an Investment made as of the time of the designation and shall
reduce the amount available for Restricted Payments under Section 4.07(a) or
under one or more clauses of the definition of Permitted Investments, as
determined by the Company. That designation shall only be permitted if the
Investment would be permitted at that time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary. The Board of
Directors may redesignate any Unrestricted Subsidiary to be a Restricted
Subsidiary if that redesignation would not cause a Default.
Section 4.19 No Amendment to Subordination Provisions.
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Without the consent of the Holders of at least a majority in aggregate
principal amount of the Notes then outstanding, the Company shall not amend,
modify or alter the Subordinated Debenture Indenture in any way to:
(1) increase the rate of or accelerate the time for payment of
interest on any Subordinated Debentures;
(2) increase the principal of, advance the final maturity date of or
shorten the Weighted Average Life to Maturity of any Subordinated
Debentures;
(3) alter the redemption provisions or the price or terms at which
the Company is required to offer to purchase any Subordinated Debentures;
or
(4) amend the subordination provisions of the Subordinated Debenture
Indenture.
Section 4.20 Payments for Consent.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture, the Notes or the Note Guarantees unless such consideration is
offered to be paid and is paid to all holders of the Notes that consent, waive
or agree to amend in the time frame set forth in the solicitation documents
relating to such consent, waiver or agreement.
Section 4.21 Changes in Covenants when Notes Rated Investment Grade.
(a) If on any date following the date of this Indenture:
(1) the applicable series of Notes are rated Baa3 or better by
Moody's and BBB- or better by S&P (or, if either such entity ceases to rate
such Notes for reasons outside of the control of the Company, the
equivalent investment grade credit rating from any other "nationally
recognized statistical rating organization" within the meaning of Rule
15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the Company as a
replacement agency (a "Replacement Agency")); and
(2) no Default or Event of Default shall have occurred and be
continuing,
then, beginning on that day (the "Rating Event Date") and subject to
the reinstatement provisions described below, the following provisions of
this Indenture shall be suspended with respect to such series of Notes:
Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.15, 4.18, clauses 1(a) and 3
of Section 4.16 and clause 4 of Section 5.01(a).
(b) Following the Rating Event Date and so long as any of the Notes are
outstanding and no Downgrade Date subsequently has occurred and is continuing,
the Company shall not pledge, mortgage, hypothecate or permit to exist any
mortgage, pledge or other Lien upon any property or assets at any time directly
owned by the Company to secure any Indebtedness without making effective
provisions whereby the Notes shall be equally and ratably secured with any and
all such Indebtedness and with any other Indebtedness similarly entitled to be
equally and ratably secured; provided, however, that this restriction shall not
apply to or prevent the creation or existence of: (a) Liens existing on the
Rating Event Date, (b) purchase money Liens which do not exceed the cost or
value of the purchased property or assets, and (c) other Liens which, taken
together with the Liens described in the preceding clauses (a) and (b) of this
77
sentence, have an aggregate principal amount that does not, on the date of
incurrence, exceed 15% of the Company's Consolidated Net Assets.
(c) Notwithstanding Sections 4.21(a) and (b) hereof, if on any date after
the Rating Event Date the ratings assigned by Moody's and S&P should decline to
below Baa3 and BBB-, respectively (or, if either such entity ceases to rate such
Notes for reasons outside the control of the Company, the Replacement Agency's
assigned rating should decline to below the equivalent of such Moody's or S&P
rating), then all of the foregoing suspended provisions described in Section
4.21(a) shall be reinstated as of and from such date of rating decline (the
"Downgrade Date"). Upon the occurrence of a Downgrade Date, the following shall
occur:
(1) calculations under Section 4.07 will be made as if that Section
4.07 had been in effect since the date of this Indenture except that no
Default will be deemed to have occurred solely by reason of a Restricted
Payment made while Section 4.07 was suspended;
(2) if Note Guarantees were released during the period between the
Rating Event Date and Downgrade Date pursuant to Section 10.05 then the
Company shall use all commercially reasonable efforts to cause each of the
Persons who were Guarantors before the Rating Event Date to execute new
Note Guarantees and to execute one or more supplemental indentures and
deliver one or more Opinions of Counsel satisfactory to the Trustee within
60 days of the Downgrade Date; provided that any such Person that
constitutes an Immaterial Subsidiary on such Downgrade Date shall not be
required to become a Guarantor until such time as it may cease to be an
Immaterial Subsidiary;
(3) no Default shall be deemed to have occurred to the extent that
Liens were released in accordance with the terms of this Indenture during
the period following the Rating Event Date and the Downgrade Date; and
(4) if Liens on Equity Interests securing the Notes were released
during the period between the Rating Event Date and Downgrade Date, then
the Company and the Guarantors shall use all commercially reasonable
efforts to pledge, as security for the Notes following the Downgrade Date,
the Equity Interests that had been subject to Liens securing the Notes
before the Rating Event Date and to execute one or more supplemental
indentures and/or supplements to the Security Documents and to deliver one
or more Opinions of Counsel, in each case satisfactory to the Trustee,
within 60 days of the Downgrade Date; provided that no Default shall be
deemed to have occurred solely by reason of the new pledge of such Equity
Interests to secure the Notes if such new Liens would cause the Company and
the Guarantors to exceed the limit on Parity Liens and other Liens imposed
pursuant to the definition of Permitted Liens.
No intervening acts or events occurring while such covenants set forth in
Section 4.21(a) hereof were suspended which would constitute a default if such
covenants had been in effect shall give rise to any default after the
reinstatement of such covenants.
Section 4.22 Further Assurances; Collateral Inspections and Reports; Costs and
Indemnification.
(a) Upon the reasonable request of the Collateral Trustee at any time and
from time to time, the Company shall, and shall cause each of its Restricted
Subsidiaries to, promptly execute, acknowledge and deliver such Security
Documents, instruments, certificates, notices and other documents and take such
other actions as the Collateral Trustee may reasonably require or request to
create, perfect, protect, assure or, subject to Article 10, enforce the Liens
and benefits intended to be conferred as contemplated by this Indenture for the
benefit of the holders of Note Obligations. If the Company or such Restricted
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Subsidiary fails to do so, the Collateral Trustee is hereby irrevocably
authorized and empowered, with full power of substitution, to execute,
acknowledge and deliver such Security Documents, instruments, certificates,
notices and other documents and, subject to Article 10, take such other actions
in the name, place and stead of the Company or such Restricted Subsidiary, but
the Collateral Trustee shall have no obligation to do so and no liability for
any action taken or omitted by it in good faith in connection therewith.
(b) Upon request of the Collateral Trustee at any time and from time to
time, the Company shall, and shall cause its Restricted Subsidiaries to, (i)
permit the Collateral Trustee or any advisor, auditor, consultant, attorney or
representative acting for the Collateral Trustee, upon reasonable notice to the
Company and during normal business hours (provided that no notice requirement or
restriction on hours shall apply if an Event of Default is continuing), to visit
and inspect any of the property of the Company and its Restricted Subsidiaries,
to review, make extracts from and copy the books and records of the Company and
its Restricted Subsidiaries relating to any such property, and to discuss any
matter pertaining to any such property with the officers and employees of the
Company and its Restricted Subsidiaries, and (ii) deliver to the Collateral
Trustee such reports, including valuations, relating to any such property or any
Lien thereon as the Collateral Trustee may reasonably request.
(c) The Company shall bear and pay all legal expenses, collateral audit
and valuation costs, filing fees, insurance premiums and other costs associated
with the performance of the obligations of the Company and its Restricted
Subsidiaries set forth in this Section 4.19 and also shall pay, or promptly
reimburse the Trustee and Collateral Trustee for, all costs and expenses
incurred by the Trustee or Collateral Trustee in connection therewith, including
all reasonable fees and charges of any advisors, auditors, consultants,
attorneys or representatives acting for the Trustee or for the Collateral
Trustee.
(d) The Company shall pay, reimburse the Trustee, the Collateral Trustee
and the Holders of Notes for, and, to the fullest extent lawful, defend and
indemnify each of them against, all claims, liabilities, taxes, costs and
expenses of every type and nature (including, without limitation, the reasonable
fees and charges of attorneys, advisors, auditors and consultants acting for any
of them) incurred by any of them as a result of or in connection with the
creation, perfection, protection or enforcement of the Note Liens or the
exercise or enforcement of any right or remedy under the Security Documents or
to prove, preserve, protect or enforce any Note Lien or any claim based upon the
Note Liens in any legal proceeding, including any Insolvency or Liquidation
Proceeding.
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
(a) The Company may not, directly or indirectly, consolidate or merge with
or into another Person (whether or not the Company is the surviving
corporation), or sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company and its Restricted
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; unless:
(1) either: (A) the Company is the surviving corporation; or (B) the
Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance
or other disposition has been made is either (i) a corporation organized or
existing under the laws of the United States, any state of the United
States or the District of Columbia or (ii) is a partnership or limited
liability company organized or existing under the laws of the United
States, any state thereof or the District of Columbia that has at least one
Restricted Subsidiary that is a corporation organized or existing under the
laws of the United
79
States, any state thereof or the District of Columbia which corporation
becomes a co-issuer of the Notes pursuant to agreements duly and validly
executed by the Trustee;
(2) the Person formed by or surviving any such consolidation or
merger (if other than the Company) or the Person to which such sale,
assignment, transfer, conveyance or other disposition has been made assumes
all the obligations of the Company under the Notes, this Indenture and the
Security Documents pursuant to agreements reasonably satisfactory to the
Trustee;
(3) immediately after such transaction, no Default or Event of
Default exists; and
(4) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been made:
(A) shall have Consolidated Net Assets immediately after the
transaction equal to or greater than the Consolidated Net Assets of
the Company immediately preceding the transaction; and
(B) shall, on the date of such transaction after giving pro
forma effect thereto and any related financing transactions as if the
same had occurred at the beginning of the applicable four-quarter
period have a pro forma Fixed Charge Coverage Ratio that is at least
equal to the actual Fixed Charge Coverage Ratio of the Company as of
such date.
The Company shall not, directly or indirectly, lease all or substantially
all of its properties or assets, in one or more related transactions, to any
other Person.
(b) Section 5.01(a) shall not apply to:
(1) a merger of the Company with an Affiliate solely for the purpose
of reincorporating the Company in another jurisdiction; and
(2) any sale, transfer, assignment, conveyance, lease or other
disposition of assets between or among the Company and its Restricted
Subsidiaries.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), 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; provided, however, that
the predecessor Company shall be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale or other
disposition of all or substantially all of the properties or assets of the
Company and its Restricted Subsidiaries taken as a whole in a transaction that
is subject to, and that complies with the provisions of, Section 5.01 hereof.
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ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following is an Event of Default for each series of Notes:
(1) default for 30 days in the payment when due of interest on any
Notes of such series;
(2) default in payment when due of the principal of, or premium, if
any, on any Notes of such series;
(3) failure by Dynegy or any of its Restricted Subsidiaries to comply
with the provisions of Sections 4.07, 4.09, 4.10, 4.15 or 5.01 hereof for
30 days after written notice from the Trustee or the Holders of at least
25% in aggregate principal amount of the affected series of Notes then
outstanding to comply with such provisions;
(4) failure by Dynegy or any of its Restricted Subsidiaries for 60
days after written notice from the Trustee or the Holders of at least 25%
in aggregate principal amount of the applicable series of Notes then
outstanding to comply with any of the other agreements in this Indenture or
the Security Documents;
(5) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by Dynegy or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by Dynegy or any of its
Restricted Subsidiaries) whether such Indebtedness or guarantee now exists,
or is created after the date of this Indenture, if that default:
(A) is caused by a failure to pay principal of, or interest or
premium, if any, on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default
(a "Payment Default"); or
(B) results in the acceleration of such Indebtedness prior to
its express maturity,
and, in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$50.0 million or more; provided that, if such default shall be remedied or cured
by Dynegy or such Restricted Subsidiary or waived by the holder of such
Indebtedness, in each case before acceleration of the Notes, then the Event of
Default under the indenture caused by reason thereof shall be deemed likewise to
have been remedied, cured or waived without further action on the part of the
Trustee, any Holder of Notes or any other Person;
(6) failure by Dynegy or any of its Restricted Subsidiaries to pay
final and non-appealable judgments aggregating in excess of $50.0 million,
which are not covered by indemnities or third party insurance, which
judgments are not paid, discharged, vacated or stayed for a period of 60
days;
(7) breach by Dynegy or any of its Restricted Subsidiaries of any
representation or warranty or agreement in the Security Documents, the
repudiation by Dynegy or any of its Restricted Subsidiaries of any of its
obligations under the Security Documents or the
81
unenforceability of the Security Documents against Dynegy or any of its
Restricted Subsidiaries for any reason;
(8) except as permitted by this Indenture, the Note Guarantee by
Dynegy, Illinova or any Significant Subsidiary of the Company shall be held
in any judicial proceeding to be unenforceable or invalid or shall cease
for any reason to be in full force and effect or Dynegy, Illinova or any
Subsidiary Guarantor that is a Significant Subsidiary of the Company, or
any Person acting on behalf of any such Guarantor, shall deny or disaffirm
its obligations under its Guarantee;
(9) the Company or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary pursuant to or within the meaning of Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in
an involuntary case,
(C) consents to the appointment of a custodian of it or for all
or substantially all of its property,
(D) makes a general assignment for the benefit of its creditors,
or
(E) generally is not paying its debts as they become due; or
(10) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole,
would constitute a Significant Subsidiary in an involuntary case;
(B) appoints a custodian of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary or for all or
substantially all of the property of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary; or
(C) orders the liquidation of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02 Acceleration.
In the case of an Event of Default specified in clause (9) or (10) of
Section 6.01 hereof, with respect to Dynegy, any Restricted Subsidiary that is a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary, all outstanding Notes shall
become due and payable immediately without further action or notice. If any
other Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the applicable
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series of Notes then outstanding may declare all the Notes of such series to be
due and payable immediately.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes of any Series by notice to the Trustee may on behalf of
the Holders of all of the Notes of such series waive an existing Default or
Event of Default and its consequences hereunder, except a continuing Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on, the Notes (including in connection with an offer to purchase);
provided, however, that the Holders of a majority in aggregate principal amount
of the then outstanding Notes of any series may rescind an acceleration and its
consequences with respect to such series of Notes, including any related payment
default that resulted from such acceleration. Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been cured for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
Section 6.05 Control by Majority.
Holders of a majority in principal amount of the then outstanding Notes of
any series may direct the time, method and place of conducting any proceeding
for exercising any remedy available to the Trustee or exercising any trust or
power conferred on it with respect to such series of Notes. However, the Trustee
may refuse to follow any direction that conflicts with law or this Indenture
that the Trustee determines may be unduly prejudicial to the rights of other
Holders of Notes of such series or that may involve the Trustee in personal
liability.
Section 6.06 Limitation on Suits.
A Holder of any series of Notes may pursue a remedy with respect to this
Indenture or such series of Notes only if:
(1) the Holder of such series of Note gives to the Trustee written
notice of a continuing Event of Default;
(2) the Holders of at least 25% in principal amount of the then
outstanding Notes of such series make a written request to the Trustee to
pursue the remedy;
(3) such Holders of Notes of such series offer and, if requested,
provide to the Trustee reasonable security or indemnity satisfactory to the
Trustee against any loss, liability or expense;
83
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
security or indemnity; and
(5) during such 60-day period the Holders of a majority in principal
amount of the then outstanding Notes of such series do not give the Trustee
a direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note of the same series or of another series under this
Indenture or to obtain a preference or priority over another Holder of a Note of
the same series or of another series under this Indenture.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note of any series to receive payment of principal, premium, if any,
and interest on the Note, on or after the respective due dates expressed in the
Note (including in connection with an offer to purchase), or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of such Holder; provided that a
Holder shall not have the right to institute any such suit for the enforcement
of payment if and to the extent that the institution or prosecution thereof or
the entry of judgment thereof would, under applicable law, result in the
surrender, impairment, waiver or loss of the Lien of this Indenture upon any
property subject to such Lien.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
Trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest 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 6.09 Trustee May File Proofs of Claim.
The Trustee is authorized 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 of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder 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 agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
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Section 6.10 Priorities.
If the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:
First: to the Trustee and the Collateral Trustee, their agents and
attorneys for amounts due under Section 7.07 and Section 12.06 hereof,
including payment of all compensation, expense and liabilities incurred,
and all advances made, by the Trustee and the Collateral Trustee and the
costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and interest, ratably, without preference
or priority of any kind, according to the amounts due and payable on the
Notes for principal, premium, if any and interest, respectively; and
Third: to the Company, the Guarantors or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10. If a record date is fixed, the
Trustee shall mail, by first class mail, to such Holders of record of the series
of Notes affected a notice at least 30 days but not more than 60 days before the
payment date. Such notice shall state: (1) that a payment is being made pursuant
to this Section 6.10, (2) the relevant Default or Event of Default and the
circumstances giving rise to the collection of money pursuant to this Section
6.10, (3) the payment date and (4) the amount of such payment per $1,000 of
Notes of such series. Notwithstanding the foregoing, if the payment pursuant to
this Section 6.10 is in respect of principal on any series of Notes, then such
principal payment will be conducted in accordance with the redemption provisions
set forth in Sections 3.02, 3.03, 3.04 and 3.06 hereof as if such payment were a
redemption by the Company.
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 a
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,
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 of a Note pursuant
to Section 6.07 hereof, or a suit by Holders of more than 10% in principal
amount of the then outstanding Notes of any series.
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default 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 its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
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(1) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(2) 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,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section 7.01;
(2) 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; and
(3) 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 Section 6.05 hereof.
(d) Whether or not thereof expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), and (c) of this Section 7.01.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder has offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
(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 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
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(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company shall be sufficient if signed by
an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities that might be incurred
by it in compliance with such request or direction.
Section 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days, apply to the SEC for permission to continue as
trustee (if this Indenture has been qualified under the TIA) or resign. Any
Agent may do the same with like rights and duties. The Trustee is also subject
to Sections 7.10 and 7.11 hereof.
Section 7.04 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital hereof or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders of the Notes.
Section 7.06 Reports by Trustee to Holders of the Notes.
(a) Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA Section 313(a) (but if no event described
in TIA Section 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA Section 313(b)(2). The Trustee shall also transmit by mail all reports
as required by TIA Section 313(c).
(b) A copy of each report at the time of its mailing to the Holders of
Notes shall be mailed by the Trustee to the Company and filed by the Trustee
with the SEC and each stock exchange on which the
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Notes are listed, if any such listing should ever occur, in accordance with TIA
Section 313(d). The Company shall promptly notify the Trustee when the Notes are
listed on any stock exchange.
(c) Within 30 days after the date of this Indenture and within 30 days
after each January 15, April 15, July 15 and October 15 following the date of
this Indenture, for so long as any Series A Notes remain outstanding, the
Trustee shall mail to the Holders of Series A Notes a brief report dated as of
such reporting date of the Applicable Eurodollar Rate then in effect with
respect to the Series A Notes as the same has been notified by the Company to
the Trustee pursuant to the terms of this Indenture.
Section 7.07 Compensation and Indemnity.
(a) The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
(b) The Company and the Guarantor shall indemnify the Trustee against any
and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Company and the Guarantors (including this Section 7.07) and defending
itself against any claim (whether asserted by the Company, the Guarantors or any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent any
such loss, liability or expense may be attributable to its negligence or bad
faith. The Trustee shall notify the Company promptly of any claim for which it
may seek indemnity. Failure by the Trustee to so notify the Company shall not
relieve the Company or any of the Guarantors of their obligations hereunder. The
Company or such Guarantor shall defend the claim and the Trustee shall cooperate
in the defense. The Trustee may have separate counsel and the Company shall pay
the reasonable fees and expenses of such counsel. Neither the Company nor any
Guarantor need pay for any settlement made without its consent, which consent
shall not be unreasonably withheld.
(c) The obligations of the Company and the Guarantors under this Section
7.07 shall survive the satisfaction and discharge of this Indenture.
(d) To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(9) or (10) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
(f) The Trustee shall comply with the provisions of TIA Section 313(b)(2)
to the extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
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(b) The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of a majority
in principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(3) a custodian or public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, 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 then outstanding Notes of all series
hereunder, voting as a single class, may appoint a successor Trustee to replace
the successor Trustee appointed by the Company.
(d) If a successor Trustee 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 10% in principal amount of the then outstanding Notes of
all series hereunder, voting as a single class, may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(e) If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, 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. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, provided all sums owing to the
Trustee hereunder have been paid and subject to the Lien provided for in Section
7.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10 Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
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This Indenture shall always have a Trustee who satisfies the requirements
of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to TIA Section
310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated thereof.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes of any
series upon compliance with the conditions set forth below in this Article 8.
Section 8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02 with respect to any series of Notes, the Company
and each of the Guarantors shall, subject to the satisfaction of the conditions
set forth in Section 8.04 hereof, be deemed to have been discharged from their
obligations with respect to all outstanding Notes of such series (including the
Note Guarantees) on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, Legal Defeasance means that
the Company and the Guarantors shall be deemed to have paid and discharged the
entire Indebtedness represented by the outstanding Notes of such series
(including the Note Guarantees), which shall thereafter be deemed to be
"outstanding" only for the purposes of Section 8.05 hereof and the other
Sections of this Indenture referred to in clauses (1) and (2) below, with
respect for such series and to have satisfied all their other obligations under
such series of Notes, the Note Guarantees with respect to such series and this
Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the
following provisions which shall survive until otherwise terminated or
discharged hereunder:
(1) the rights of Holders of outstanding Notes of such series to
receive payments in respect of the principal of, or interest or premium, if
any, on such series of Notes when such payments are due from the trust
referred to in Section 8.04 hereof;
(2) the Company's obligations with respect to such series of Notes
under Article 2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Company's and the Guarantors' obligations in connection
therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Company may exercise its
option under this Section 8.02 notwithstanding the prior exercise of its option
under Section 8.03 hereof.
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Section 8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03 with respect to any series of Notes, the Company
and the Guarantors shall, subject to the satisfaction of the conditions set
forth in Section 8.04 hereof, be released from each of their obligations under
the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13,
4.15, 4.16, 4.17, 4.18, 4.19, 4.21, 4.22 and 10.03 hereof and clause (4) of
Section 5.01(a) hereof with respect to the outstanding Notes of such series on
and after the date the conditions set forth in Section 8.04 hereof are satisfied
(hereinafter, "Covenant Defeasance"), and the Notes of such series shall
thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
series of Notes shall not be deemed outstanding for accounting purposes). For
this purpose, Covenant Defeasance means that, with respect to the outstanding
Notes and Note Guarantees of the relevant series, the Company and the Guarantors
may omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere hereof to any such covenant or
by reason of any reference in any such covenant to any other provision hereof or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01 hereof with respect to such series of
Notes, but, except as specified above, the remainder of this Indenture and such
Notes and Note Guarantees of such series shall be unaffected thereby and this
Indenture in its entirety and other series of Notes and the Note Guarantees also
shall be unaffected thereby. In addition, upon the Company's exercise under
Section 8.01 hereof of the option applicable to this Section 8.03 hereof,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(3) through 6.01(6) hereof shall not constitute Events of Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance under
either Section 8.02 or 8.03 hereof:
(1) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders of the particular series of Notes to be
defeased, cash in United States dollars, non-callable Government
Securities, or a combination thereof, in such amounts as shall be
sufficient, in the opinion of a nationally recognized investment bank,
appraisal firm or firm of independent public accountants, to pay the
principal of, premium, if any, and interest on the outstanding Notes of the
series being defeased on the stated date for payment thereof or on the
applicable redemption date, as the case may be, and the Company shall
specify whether such Notes are being defeased to maturity or to a
particular redemption date;
(2) in the case of an election under Section 8.02 hereof, the Company
has delivered to the Trustee an Opinion of Counsel reasonably acceptable to
the Trustee confirming that:
(A) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling; or
(B) since the date of this Indenture, there has been a change in
the applicable federal income tax law,
in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of the outstanding Notes of
the series being defeased will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance
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and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such
Legal Defeasance had not occurred;
(3) in the case of an election under Section 8.03 hereof, the Company
must deliver to the Trustee an Opinion of Counsel reasonably acceptable to
the Trustee confirming that the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result
of such Covenant Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such Covenant Defeasance had not occurred;
(4) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit);
(5) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture) to which the Company or
any Guarantor is a party or by which the Company or any Guarantor is bound;
(6) the Company must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes of such series over the other creditors of
the Company with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
provided for or relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.
Notwithstanding the foregoing, the Opinion of Counsel required by clause
(2) above need not be delivered if all Notes of this series being defeased not
theretofore delivered to the Trustee for cancellation (1) have become due and
payable or (2) will become due and payable on the maturity date within one year
under arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
of the series being defeased shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Notes and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as Paying Agent) as the Trustee may determine, to the Holders of such
Notes of all sums due and to become due thereon in respect of principal, if any,
and interest, but such money need not be segregated from other funds except to
the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
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Notwithstanding anything in this Article 8 to the contrary, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized
investment bank, appraisal firm or firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee (which may
be the opinion delivered under Section 8.04(1) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06 Repayment to the Company.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of, premium, if any, or
interest on any Note that has been defeased and remaining unclaimed for two
years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Company on its request or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Note shall
thereafter be permitted to look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified thereof, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
shall be repaid to the Company. After payment to the Company, Holders entitled
to such money must look to the Company unless an applicable law designates
another Person (for payment as general creditor).
Section 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's and the Guarantors' obligations under this
Indenture and the Notes and the Note Guarantees shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03 hereof, as the case may be; provided,
however, that, if the Company makes any payment of principal of, if any, or
interest on any Note following the reinstatement of its obligations, the Company
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors, the Trustee and the Collateral Trustee may amend or supplement this
Indenture, the Notes, the Note Guarantees or the Security Documents without the
consent of any Holder of a Note:
(1) to cure any ambiguity, defect or inconsistency;
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(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;
(3) to provide for the assumption of the Company's or a Guarantor's
obligations to the Holders of the Notes by a successor to the Company
pursuant to Article 5 or Article 10 hereof;
(4) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the
legal rights hereunder of any Holder of the Note;
(5) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(6) to provide for the issuance of Additional Notes in accordance
with the limitations set forth in this Indenture as of the date hereof;
(7) to allow any Guarantor to execute a supplemental indenture and/or
a Note Guarantee with respect to the Notes;
(8) to make, complete or confirm any grant of Collateral permitted or
required by this Indenture or any release of Collateral that becomes
effective as set forth in this Indenture;
(9) to reflect any waiver or termination of any right arising under
Article 11 that otherwise would be enforceable by any holder of a Parity
Lien Obligation or Parity Lien, if such waiver or termination is set forth
or provided in the indenture or agreement governing or giving rise to such
Parity Lien Obligation or Parity Lien; provided, that no such waiver or
amendment pursuant to this clause (9) shall adversely affect the rights of
Holders of Notes; or
(10) to conform the text of this Indenture, the Notes, the Note
Guarantees or the Security Documents to any provision that was contained in
the Offering Circular, dated as of August 1, 2003, that was used by the
Initial Purchasers in connection with the distribution of the Initial Notes
to the extent that such document contained a description of any provision
of this Indenture, the Notes, the Note Guarantees or the Security Documents
that was intended to be a verbatim recitation of such provision.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee and the Collateral Trustee shall join with the Company
and the Guarantors in the execution of any amended or supplemental Indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be thereof contained, but
neither the Trustee nor the Collateral Trustee shall be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company, the Trustee and
the Collateral Trustee may amend or supplement this Indenture (including,
without limitation, Section 3.09, 4.10 and 4.15 hereof), the Notes and the Note
Guarantees with respect to a particular series of Notes with the consent of the
Holders of at least a majority in principal amount of such series of Notes
(including,
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without limitation, Additional Notes of such series, if any), as the case may
be, then outstanding (including, without limitation, consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on any series of Notes, except a
payment default resulting from an acceleration that has been rescinded) or
compliance with any provision of this Indenture, the Notes or the Note
Guarantees may be waived with the consent of the Holders of a majority in
principal amount of the then outstanding Notes of such series (including
consents obtained in connection with a tender offer or exchange offer for, or
purchase of, the Notes). Section 2.08 hereof shall determine which Notes are
considered to be "outstanding" for purposes of this Section 9.02.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee and
the Collateral Trustee shall join with the Company in the execution of such
amended or supplemental Indenture unless such amended or supplemental Indenture
directly affects the Trustee or the Collateral Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee or the
Collateral Trustee may in its discretion, but shall not be obligated to, enter
into such amended or supplemental Indenture. The Collateral Trustee shall sign
any amendment to the Security Documents pursuant to this Article 9 if the
amendment does not adversely affect the rights, duties, liabilities or
immunities of the Collateral Trustee.
It is not be necessary for the consent of the Holders of Notes under this
Section 9.02 to approve the particular form of any proposed amendment or waiver,
but it is sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect thereof, shall not, however, in
any way impair or affect the validity of any such amended or supplemental
Indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes of any series then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes of such series. However, with
respect to each series of Notes without the consent of each Holder of such
series affected, an amendment or waiver under this Section 9.02 may not (with
respect to any Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any Note
of such series or alter or waive any of the provisions with respect to the
redemption of such series of Notes (other than Sections 4.10 and 4.15
hereof);
(3) reduce the rate of or change the time for payment of interest,
including default interest, on any Note of such series;
(4) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest on such series of Notes (except a
rescission of acceleration of such Notes by the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes of
such series and a waiver of the payment default that resulted from such
acceleration);
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(5) make any Note payable in money other than that stated in such
Notes;
(6) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of such Notes to receive
payments of principal of, or interest or premium, if any, on such Notes;
(7) waive a redemption payment with respect to any such Note (other
than a payment required pursuant to Section 4.10 or 4.15 hereof);
(8) release any Guarantor from any of its obligations under its Note
Guarantee or this Indenture, except in accordance with the terms of this
Indenture.
(9) release any Collateral from the Liens created by the Security
Documents except as specifically provided in this Indenture and the
Security Documents; or
(10) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amended or supplemental Indenture that complies with the TIA as then
in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
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 30 days prior to the
first solicitation of such consent. If a record date is fixed, those Persons who
were Holders at such record date (or their duly designated proxies), and only
those Persons shall be entitled to revoke any consent previously given, whether
or not such Persons continue to be Holders after such record date. No such
consent shall be valid or effective for more than 90 days after such record
date. The Company shall inform the Trustee in writing of the fixed record date,
if applicable.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.
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Section 9.06 Trustee to Sign Amendments, etc.
The Trustee and the Collateral Trustee shall sign any amended or
supplemental Indenture authorized pursuant to this Article 9 if the amendment or
supplement does not adversely affect the rights, duties, liabilities or
immunities of the Trustee or the Collateral Trustee. The Collateral Trustee
shall sign any amended or supplemental Indenture authorized pursuant to this
Article and any amendment to the Security Documents pursuant to this Article 9
if the amendment does not adversely affect the rights, duties, liabilities or
immunities of the Collateral Trustee. Except in the case of a supplemental
Indenture required to be delivered pursuant to Section 4.17 hereof, the Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee and
the Collateral Trustee shall be entitled to receive and (subject to Section 7.01
hereof) shall be fully protected in relying upon, in addition to the documents
required by Section 12.04 hereof, an Officers' Certificate and an Opinion of
Counsel stating that the execution of such amended or supplemental Indenture is
authorized or permitted by this Indenture.
ARTICLE 10.
NOTE GUARANTEES
Section 10.01 Guarantee.
(a) Subject to this Article 10, each of the Guarantors hereby, jointly and
severally, unconditionally guarantees to each Holder of a Note authenticated and
delivered by the Trustee and to the Trustee and its successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that:
(1) the principal of, premium, if any, and interest on the Notes will
be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and
interest on the Notes, if any, if lawful, and all other obligations of the
Company to the Holders or the Trustee hereunder or thereunder will be
promptly paid in full or performed, all in accordance with the terms hereof
and thereof; and
(2) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance so
guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the same immediately. Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder are
unconditional, irrespective of the validity, regularity or enforceability of the
Notes or this Indenture, the absence of any action to enforce the same, any
waiver or consent by any Holder of the Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a guarantor. Each Guarantor hereby
waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenant that this Note Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes and this Indenture.
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(c) If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this Note
Guarantee, to the extent theretofore discharged, will be reinstated in full
force and effect.
(d) Each Guarantor agrees that it will not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Note Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (2) in the event of any declaration of acceleration of
such obligations as provided in Article 6 hereof, such obligations (whether or
not due and payable) will forthwith become due and payable by the Guarantors for
the purpose of this Note Guarantee. The Guarantors will have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such right
does not impair the rights of the Holders under the Note Guarantee.
Section 10.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee of
such Guarantor not constitute a fraudulent transfer or conveyance for purposes
of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar federal or state law to the extent applicable to any
Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such
Guarantor will be limited to the maximum amount that will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
Guarantor that are relevant under such laws, and after giving effect to any
collections from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 10, result in the obligations of such Guarantor
under its Note Guarantee not constituting a fraudulent transfer or conveyance.
Section 10.03 Execution and Delivery of Note Guarantee.
To evidence its Note Guarantee set forth in Section 10.01, each Guarantor
hereby agrees that a notation of such Note Guarantee substantially in the form
attached as Exhibit E hereto will be endorsed by an Officer of such Guarantor on
each Note authenticated and delivered by the Trustee and that this Indenture
will be executed on behalf of such Guarantor by one of its officers. Upon such
execution, the new Guarantor(s) shall be added to Schedule I hereto.
Each Guarantor hereby agrees that its Note Guarantee set forth in Section
10.01 will remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note Guarantee
no longer holds that office at the time the Trustee authenticates the Note on
which a Note Guarantee is endorsed, the Note Guarantee will be valid
nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, will constitute due delivery of the Note Guarantee set forth in this
Indenture on behalf of the Guarantors.
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In the event that the Company creates or acquires any Domestic Subsidiary
after the date of this Indenture, if required by Section 4.17 hereof, the
Company will cause such Domestic Subsidiary to comply with the provisions of
Section 4.17 hereof and this Article 10, to the extent applicable.
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms.
(a) Except as otherwise provided in Section 10.05, no Guarantor may sell
or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, other than the Company or another Guarantor,
unless:
(1) immediately after giving effect to such transaction, no Default
or Event of Default exists; and
(2) either:
(A) subject to Section 10.05 hereof, the Person acquiring the
property in any such sale or disposition or the Person formed by or
surviving any such consolidation or merger (if not such Guarantor)
unconditionally assumes all the obligations of that Guarantor,
pursuant to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee and the Collateral Trustee, under this
Indenture, the Note Guarantee and the Security Documents on the terms
set forth herein or therein; or
(B) the Net Proceeds of such sale or other disposition are
applied in accordance with the applicable provisions of this
Indenture, including without limitation, Section 4.10 hereof and the
Intercreditor Agreement.
(b) In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the Note
Guarantee endorsed upon the Notes and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person will succeed to and be substituted for the Guarantor with
the same effect as if it had been named herein as a Guarantor. Such successor
Person thereupon may cause to be signed any or all of the Note Guarantees to be
endorsed upon all of the Notes issuable hereunder which theretofore shall not
have been signed by the Company and delivered to the Trustee. All the Note
Guarantees so issued will in all respects have the same legal rank and benefit
under this Indenture as the Note Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Note
Guarantees had been issued at the date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes will prevent any consolidation or merger of a Guarantor with or into the
Company or another Guarantor, or will prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or another Guarantor.
Section 10.05 Releases of Guarantees.
(a) In the event of any sale or other disposition of all or substantially
all of the assets of any Guarantor, by way of merger, consolidation or
otherwise, or a sale or other disposition of all of the Capital Stock of any
Guarantor, in each case to a Person that is not (either before or after giving
effect to such transactions) Dynegy or any of its Restricted Subsidiaries, then
such Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the capital stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or
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substantially all of the assets of such Guarantor) will be released and relieved
of any obligations under its Note Guarantee and this Indenture; provided that
the Net Proceeds of such sale or other disposition are applied in accordance
with the applicable provisions of this Indenture, including without limitation
Section 4.10 hereof. Upon delivery by the Company to the Trustee and the
Collateral Trustee of an Officers' Certificate and an Opinion of Counsel to the
effect that such sale or other disposition was made by the Company in accordance
with the provisions of this Indenture, including without limitation Section 4.10
hereof, the Trustee and the Collateral Trustee will execute any documents
reasonably required in order to evidence the release of such Guarantor from its
obligations under its Note Guarantee, this Indenture (including removal from
Schedule I hereto) and the Security Documents.
(b) The Note Guarantee of a Guarantor also shall be released upon:
(1) the designation by the Company of any of its Restricted
Subsidiaries that is a Guarantor as an Unrestricted Subsidiary pursuant to
Section 4.18 hereof;
(2) with respect to any series of Notes, upon legal defeasance of
such Notes pursuant to Section 8.02 hereof or satisfaction and discharge of
such Notes pursuant to Article 13 hereof; or
(3) with respect to any series of Notes, at any time upon:
(A) the prior consent of Holders of at least two-thirds in
aggregate principal amount of Notes of such series then outstanding;
(B) the consent of the Credit Agreement Agent to the release of
such Guarantor's Guarantee of all Obligations under the Credit
Agreement; and
(C) the contemporaneous release of such Guarantor's Guarantee of
all Obligations under the Credit Agreement.
(c) Any Guarantor not released from its obligations under its Note
Guarantee will remain liable for the full amount of principal of and interest on
the Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article 10.
ARTICLE 11.
RANKING OF NOTE LIENS
Section 11.01 Agreement for the Benefit of Holders of Priority and Parity
Liens.
The Trustee and the Collateral Trustee agree, and each Holder of Notes by
accepting a Note agrees, that:
(1) the Note Liens (and, to the extent the Trustee, the Collateral
Trustee or any Holder of Notes has an interest thereof, the Parity Liens)
upon any and all Collateral are, to the extent and in the manner provided
in this Article 11 and the Intercreditor Agreement, subordinate in ranking
to all present and future Priority Liens; and
(2) the Note Liens upon any and all Collateral shall be of equal
ranking with all present and future Parity Liens subject, as to the NGL
Assets, to Section 11.05, and any proceeds of any realization by the
Collateral Trustee on this Collateral shall be distributed equally and
ratably on account of the Priority Lien Obligations,
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and that such agreements as to the ranking of the Note Liens:
(A) are enforceable by the holders of Priority Liens, for the
benefit of the holders of Priority Lien Obligations secured thereby,
and enforceable by the holders of Parity Liens, for the benefit of the
holders of Parity Lien Obligations secured thereby;
(B) shall remain enforceable by the holders of Priority Liens
until the payment in full of all Priority Lien Obligations and
termination of all commitments to advance credit thereunder;
(C) shall remain enforceable by the holders of Parity Liens
until the Discharge of Parity Lien Debt; and
(D) shall apply notwithstanding (1) the time of incurrence
of any such Indebtedness, (2) the order or method of attachment or
perfection of any Liens securing any such Indebtedness, (3) the time
or order of filing or recording of financing statements, mortgages or
other documents filed or recorded to perfect any Lien upon any
Collateral, (4) the time of taking possession or control over any
Collateral, (5) the rules for determining priority under any law
governing relative priorities of Liens, or (6) any provision of the
Security Documents to the contrary.
Section 11.02 Lien Sharing with Parity Liens.
If the Company at any time delivers to the Trustee and the Collateral
Trustee:
(1) an Officers' Certificate requesting that the Trustee direct the
Collateral Trustee to transfer the Note Liens to a proposed Joint
Collateral Agent pursuant to a proposed Note Lien Assignment delivered to
the Trustee and Collateral Trustee therewith and stating that:
(A) the Company intends to incur, on a date stated thereof,
Indebtedness that shall constitute Parity Lien Debt;
(B) no Default or Event of Default exists on the date of such
Officers' Certificate or shall exist after giving effect to the
incurrence of such Indebtedness;
(C) the Company has appointed such proposed Joint Collateral
Agent pursuant to a proposed Joint Collateral Agent Undertaking
executed and delivered by the Company and such proposed Joint
Collateral Agent and delivered to the Trustee and Collateral Trustee
therewith;
(D) the Company shall, on the date of such incurrence, grant
Liens to such proposed Joint Collateral Agent, for the benefit of the
holders of Note Obligations and Parity Lien Obligations and as
security for all present and future Note Obligations and Parity Lien
Obligations, upon all or substantially all of the Collateral that, on
such date, is subject to the Note Liens, pursuant to proposed
additional Security Documents delivered to the Trustee and Collateral
Trustee therewith that are substantially the same as the Security
Documents in effect on such date;
(E) the Liens granted by such proposed additional Security
Documents shall not be subject or subordinate to any Lien securing
Indebtedness other than Priority Liens and Permitted Liens; and
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(F) the Company and its Restricted Subsidiaries shall, on such
date, enter into all amendments to the Security Documents then in
effect that are necessary to add Parity Lien Obligations to the
obligations secured thereby, pursuant to amendments delivered to the
Trustee and the Collateral Trustee therewith, to be executed on such
date by the proposed Joint Collateral Agent and the Company or the
Restricted Subsidiary party to such Security Documents;
and
(2) an Opinion of Counsel confirming on customary terms:
(A) the existence, good standing, powers and authority of the
proposed Joint Collateral Agent;
(B) the validity and enforceability of the proposed Joint
Collateral Agent Undertaking, Note Lien Assignment and all additional
and amended Security Documents delivered to the Trustee;
(C) the validity, enforceability and perfection of the Liens
granted by such Security Documents; and
(D) the continued perfection of the Note Liens, without loss of
priority as against any Lien other than Parity Liens, upon giving
effect to such Note Lien Assignment and any such amendment of the
Security Documents,
then, the Trustee shall direct the Collateral Trustee to execute and deliver,
and upon such direction the Collateral Trustee shall be irrevocably and
unconditionally authorized and directed to execute and deliver, the proposed
Note Lien Assignment to such Joint Collateral Agent against delivery to the
Trustee and Collateral Trustee of (x) written confirmation from such Joint
Collateral Agent that it accepts such Note Lien Assignment and shall hold the
Note Liens and all such Security Documents and the Liens granted thereby for the
benefit of the holders of the Note Obligations and Parity Lien Obligations on
the terms of such Joint Collateral Agent Undertaking and (y) a further Officers'
Certificate stating that such Indebtedness has been incurred in conformity with
Section 4.09 and constitutes Parity Lien Debt and that such Security Documents
have been duly executed and delivered by the parties thereto.
Following the initial incurrence of Parity Lien Debt, any additional Parity
Lien Debt incurred thereafter shall be included in the obligations secured under
the Security Documents if the Company delivers to the Trustee, the Collateral
Trustee and the Joint Collateral Agent:
(1) an Officer's Certificate stating that
(A) the Company intends to incur, on a date stated thereof,
indebtedness that shall constitute Parity Lien Debt;
(B) no Default or Event of Default exists on the date of such
Officers Certificate or shall exist after giving effect to the
incurrence of such Indebtedness;
(C) the Company and its Restricted Subsidiaries shall, on such
date, enter into any amendments to the Security Documents then in
effect that are necessary to add such additional Parity Lien
Obligations to the obligations secured thereby, pursuant to amendments
delivered to the Trustee and the Collateral Trustee therewith, to be
executed
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on such date by the Joint Collateral Agent and the Company or the
Restricted Subsidiary party to such Security Documents;
and
(2) an Opinion of Counsel confirming on customary terms the validity
and enforceability of any additional and amended Security Documents
delivered to the Trustee.
Upon delivery of such certificate and opinion, the Trustee shall direct the
Collateral Trustee and/or the Joint Collateral Agent, as applicable, to enter
into any amendments of Security Documents as may be required to add such
additional Parity Lien Obligations as obligations secured under such Security
Documents.
Section 11.03 Amendment; Waiver.
(a) No amendment or supplement to the provisions of Article 11 hereof will
be effective without the written consent of the Company and, if any Parity Lien
Debt is then outstanding, the holders of at least a majority in principal amount
of all Parity Lien Debt then outstanding voting as a single class, except that
any such amendment which increases the obligations or adversely affects the
rights of the holders of Parity Lien Debt will be effective only with the
consent of the holders of at least 66-2/3% in principal amount of all Parity
Lien Debt then outstanding, voting as a single class.
Any such amendment or supplement that:
(A) imposes any obligation upon the Company or adversely affects
the rights of the Company under Section 11.02 hereof will become
effective only with the consent of the Company; or
(B) imposes any obligation upon the Collateral Trustee or
adversely affects the rights of the Collateral Trustee in its
individual capacity at any time when the Trustee is not the Collateral
Trustee will become effective only with the consent of the Collateral
Trustee.
(b) No waiver of any of the provisions of this Article 11 will in any
event be effective unless set forth in a writing signed and consented to, as
required for an amendment under Section 11.03 hereof, by the Company, Trustee,
and Collateral Trustee and Holders of Notes as required pursuant to Section
11.03.
Section 11.04 Notes, Note Guarantees and other Note Obligations not
Subordinated.
The provisions of this Article 11 and the Intercreditor Agreement are
intended solely to set forth the relative ranking, as Liens, of (1) the Note
Liens (and, to the extent the Trustee, the Collateral Trustee or any Holder of
Notes has an interest thereof, the Parity Liens) as against the Priority Liens
and (2) the Note Liens as against the Parity Liens. The Notes and Note
Guarantees are senior non-subordinated obligations of the Company and
Guarantors. Except as expressly set forth in the Intercreditor Agreement or
Section 11.05 hereof, neither the Notes, the Note Guarantees and other Note
Obligations nor the exercise or enforcement of any right or remedy for the
payment or collection thereof are intended to be, or shall ever be by reason of
the provisions of this Article 11, in any respect subordinated, deferred,
postponed, restricted or prejudiced.
Section 11.05 NGL Assets.
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Notwithstanding anything to the contrary set forth in this Indenture or any
Security Documents, any Collateral that constitutes NGL Assets shall secure any
Parity Lien Obligations in an aggregate amount not to exceed (i) the maximum
amount permitted to be secured by the NGL Assets under the 1996 Indenture on the
date of incurrence of such Parity Lien Obligations (without taking into account
any First Priority Secured Obligations and Parity Lien Obligations secured by
the NGL Assets prior to the date of such incurrence) less (ii) the amount of all
First Priority Secured Obligations and previously incurred Parity Lien
Obligations secured by NGL Assets on such date, as such amount shall be set
forth in an officers certificate of the Company demonstrating the calculation
thereof in reasonable detail. If Parity Lien Obligations are incurred on more
than one occasion, such Parity Lien Obligations shall be treated as separate
tranches each independently secured by the maximum amount permitted under this
clause (b) and each tranche shall share proceeds from any realization on any
such collateral on a ratable basis and the Security Documents securing such
obligations shall expressly provide for such sharing.
ARTICLE 12.
COLLATERAL AND SECURITY
Section 12.01 Security Documents.
(a) The payment of the principal of and interest and premium, if any, on
the Notes when due, whether on an interest payment date, at maturity, by
acceleration, repurchase, redemption or otherwise and whether by the Company
pursuant to the Notes or by any Guarantor pursuant to the Note Guarantees, the
payment of all other Note Obligations and the performance of all other
obligations of the Company and its Restricted Subsidiaries under the Note
Documents are secured as provided in the Security Documents which the Company
and the Guarantors have entered into simultaneously with the execution of this
Indenture and shall be secured by all Security Documents hereafter delivered as
required or permitted by this Indenture.
(b) The Company shall, and shall cause each of its Restricted Subsidiaries
to, do or cause to be done all acts and things which may be required, or which
the Collateral Trustee from time to time may reasonably request, to assure and
confirm that the Collateral Trustee holds, for the benefit of the holders of
Note Obligations or, if the Collateral Trustee is a Joint Collateral Agent, for
the benefit of the holders of Note Obligations and Parity Lien Obligations, duly
created, enforceable and perfected Liens upon the Collateral as contemplated by
this Indenture and the Security Documents, so as to render the same available
for the security and benefit of this Indenture and of the Notes, Note Guarantees
and all other Note Obligations, according to the intent and purposes hereof
expressed subject in each case to any express provisions of any Security
Documents and the Intercreditor Agreement.
Section 12.02 Collateral Trustee.
(a) Xxxxx Fargo Bank Minnesota, N.A., shall act as Collateral Trustee
until such time, if any, as the Note Liens are transferred to the Joint
Collateral Agent.
(b) The Collateral Trustee is authorized and empowered to appoint one or
more co-Collateral Trustees as it deems necessary or appropriate.
(c) Neither the Trustee nor the Collateral Trustee nor any of their
respective officers, directors, employees, attorneys or agents shall be
responsible or liable for the existence, genuineness, value or protection of any
Collateral, for the legality, enforceability, effectiveness or sufficiency of
the Security Documents, for the creation, perfection, priority, sufficiency or
protection of any Note Lien, or for any defect or deficiency as to any such
matters, or for any failure to demand, collect, foreclose or realize upon or
otherwise enforce any of the Note Liens or Security Documents or any delay in
doing so.
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(d) The Collateral Trustee shall be subject to such directions as may be
given it by the Trustee from time to time as required or permitted by this
Indenture. Except as set forth in the Intercreditor Agreement or directed by the
Trustee as required or permitted by this Indenture or any Joint Collateral Agent
Undertaking, the Collateral Trustee shall not be obligated:
(1) to act upon directions purported to be delivered to it by any
other Person;
(2) to foreclose upon or otherwise enforce any Note Lien; or
(3) to take any other action whatsoever with regard to any or all of
the Note Liens, Security Documents or Collateral.
(e) The Collateral Trustee shall be accountable only for amounts that it
actually receives as a result of the enforcement of the Note Liens or Security
Documents.
(f) In acting as Collateral Trustee or Co-Collateral Trustee, the
Collateral Trustee and each Co-Collateral Trustee may rely upon and enforce each
and all of the rights, powers, immunities, indemnities and benefits of the
Trustee under Article 7.
(g) For as long as the Trustee is the Collateral Trustee, each successor
Trustee shall become the successor Collateral Trustee as and when the successor
Trustee becomes the Trustee.
(h) At all times when the Trustee is not itself the Collateral
Trustee, the Company shall deliver to the Trustee copies of all Security
Documents delivered to the Collateral Trustee and copies of all documents
delivered to the Collateral Trustee pursuant to the Security Documents.
(i) The Collateral 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
from the Trustee pursuant to Article 12 hereof.
Section 12.03 Authorization of Actions to Be Taken.
(a) Each Holder of Notes, by its acceptance thereof, consents and
agrees to the terms of each Security Document and Intercreditor Agreement, as
originally in effect and as amended, supplemented or replaced from time to time
in accordance with its terms or the terms of this Indenture, authorizes and
empowers the Trustee to direct the Collateral Trustee to enter into, and the
Collateral Trustee to execute and deliver, each Intercreditor Agreement and
Security Document, and authorizes and empowers the Trustee and the Collateral
Trustee to bind the Holders of Notes and other holders of Note Obligations as
set forth in the Security Documents and the Intercreditor Agreement and the
Security Documents and to perform its obligations and exercise its rights and
powers thereunder.
(b) The Collateral Trustee and the Trustee are authorized and empowered to
receive for the benefit of the Holders of Notes any funds collected or
distributed under the Security Documents and to make further distributions of
such funds to the Holders of Notes according to the provisions of this
Indenture, the Security Documents and the Intercreditor Agreement.
(c) Subject to the provisions of the Intercreditor Agreement and Section
7.01 and 7.02 and Article 12, the Trustee may, in its sole discretion and
without the consent of the Holders of Notes, direct, on behalf of the Holders of
Notes, the Collateral Trustee to take all actions it deems necessary or
appropriate in order to:
(1) foreclose upon or otherwise enforce any or all of the Note Liens;
105
(2) enforce any of the terms of the Security Documents; or
(3) collect and receive payment of any and all Note Obligations.
Subject to the Intercreditor Agreement, the Trustee is authorized and empowered
to institute and maintain, or direct the Collateral Trustee to institute and
maintain, such suits and proceedings as it may deem expedient to protect or
enforce the Note Liens or the Security Documents or to prevent any impairment of
Collateral by any acts that may be unlawful or in violation of the Security
Documents or this Indenture, and such suits and proceedings as the Trustee or
the Collateral Trustee may deem expedient to preserve or protect its interests
and the interests of the Holders of Notes in the Collateral, including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of Holders of Notes, the
Trustee or the Collateral Trustee.
Section 12.04 Release of Note Liens.
(a) The Note Liens shall be released:
(1) in whole, upon payment in full of the principal of, accrued and
unpaid interest and premium, if any, on the Notes and payment in full of
all other Note Obligations that are due and payable at or prior to the time
such principal, accrued and unpaid interest and premium, if any, are paid;
(2) in whole, upon satisfaction and discharge of this Indenture
pursuant to Section 13.01;
(3) in whole, upon a legal defeasance or covenant defeasance pursuant
to Article 8;
(4) in part, as to any property constituting Collateral that (a) is
sold or otherwise disposed of by the Company or one of its Subsidiaries in
a transaction permitted by this Indenture, at the time of such sale or
disposition, to the extent of the interest sold or disposed of, or (b) is
owned or at any time acquired by a Subsidiary that has been released from
its Note Guarantee, concurrently with the release of such Note Guarantee;
or
(5) if, after the occurrence and during the continuance of an
event of default under any Priority Collateral Document, as provided in the
Intercreditor Agreement.
(6) otherwise with respect to any Liens on assets other than Equity
Interests, as provided in the Intercreditor Agreement; or
(7) otherwise with respect to any Liens including Equity Interests,
upon either:
(A) the prior consent of holders of at least two-thirds in
aggregate principal amount of each series of notes then outstanding;
or
(B) the terms set forth in the Intercreditor Agreement:
(b) Upon delivery to the Trustee of an Officers' Certificate requesting
release of the Note Liens pursuant to Section 12.04(a), accompanied by:
106
(1) an Opinion of Counsel confirming that such release is required by
Section 12.04(a);
(2) all instruments requested by the Company to effectuate or confirm
such release; and
(3) such other certificates and documents as the Trustee, Collateral
Trustee or the Joint Collateral Agent, as applicable, may reasonably
request to confirm the matters set forth in Section 12.04(a),
the Trustee shall, instruct the Collateral Trustee or the Joint Collateral
Agent, as applicable, to execute and deliver, and the Collateral Trustee or the
Joint Collateral Agent, as applicable, shall promptly execute and deliver, such
instruments.
(c) All instruments effectuating or confirming any release of any Note
Liens shall have the effect solely of releasing such Note Liens as to the
Collateral described thereof, on customary terms and without any recourse,
representation, warranty or liability whatsoever.
(d) The Trustee, Collateral Trustee and the Joint Collateral Agent are not
required to serve, file, register or record any instrument releasing Collateral.
(e) The Company shall bear and pay all costs and expenses associated with
any release of Note Liens pursuant to Section 12.04, including all reasonable
fees and disbursements of any attorneys or representatives acting for the
Trustee, the Collateral Trustee and the Joint Collateral Agent.
Section 12.05 Filing, Recording and Opinions.
(a) The Company shall furnish to the Trustee and the Collateral Trustee on
May 15 in each year, beginning with May 15, 2004, an Opinion of Counsel, dated
as of such date, either:
(1) stating that, in the opinion of such counsel, (A) action has been
taken with respect to the recording, registering, filing, re-recording,
re-registering and re-filing of all supplemental indentures, financing
statements, continuation statements or notices, recordations or instruments
of further assurance as is necessary to maintain and perfect the Liens
intended to be created by the Security Documents and reciting the details
of such action or referring to prior Opinions of Counsel in which such
details are given, and (B) based on relevant laws as in effect on the date
of such Opinion of Counsel, all financing statements and continuation
statements have been executed and filed that are necessary as of such date
and during the succeeding 13 months to perfect the Note Liens, to the
extent the Note Liens can be perfected by the filing of a financing
statement; or
(2) stating that, in the opinion of such counsel, no such action is
necessary to maintain such Liens as effective and perfected.
(b) The Company shall otherwise comply with the provisions of TIA
Section 314(b).
(c) To the extent applicable, the Company shall cause TIA Section 313(b),
relating to reports, and TIA Section 314(d), relating to the release of property
or securities from Note Liens or relating to the substitution therefor of any
property or securities to be subjected to the Lien of the Security Documents, to
be complied with. Any certificate or opinion required by TIA Section 314(d) may
be made by an Officer of the Company except in cases where TIA Section 314(d)
requires that such certificate or opinion be made by an independent Person,
which Person shall be an independent engineer, appraiser or other expert
selected or reasonably satisfactory to the Trustee and the Collateral Trustee.
107
(d) To the extent applicable, the Company shall furnish to the Trustee and
the Collateral Trustee, prior to each proposed release of Collateral pursuant to
the Security Documents:
(1) all documents required by TIA Section 314(d); and
(2) an Opinion of Counsel to the effect that such accompanying
documents constitute all documents required by TIA Section 314(d).
The Trustee may, to the extent permitted by Sections 7.01 and 7.02 hereof,
accept as conclusive evidence of compliance with the foregoing provisions the
appropriate statements contained in such documents and Opinion of Counsel.
Notwithstanding the foregoing, if this Indenture has not been qualified
under the TIA and is not required to be qualified under the TIA at the time of
any release of Collateral, then the Company shall not be required to furnish the
documents and Opinions of Counsel required by this Section 12.05(d) if such
release of Collateral is effected pursuant to Section 12.04(a)(6) or Section
12.04(a)(7)(B) hereof.
(e) If any Collateral is released in accordance with this Indenture, the
Intercreditor Agreement or any Security Document at a time when the Trustee is
not itself also the Collateral Trustee and if the Company has delivered the
certificates and documents required by the Security Documents and this Sections
14.02, the Trustee shall determine whether it has received all documentation
required by TIA Section 314(d) in connection with such release and, based on
such determination and the Opinion of Counsel delivered pursuant to Section
14.02, shall deliver a certificate to the Collateral Trustee setting forth such
determination.
Section 12.06 Compensation and Indemnity.
(b) The Company shall pay to the Collateral Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder and under the Security Documents. The Collateral Trustee's
compensation shall not be limited by any law on compensation of a Collateral
Trustee of an express trust. The Company shall reimburse the Collateral Trustee
promptly upon request for all reasonable disbursements, advances and expenses
incurred or made by it in addition to the compensation for its services. Such
expenses shall include the reasonable compensation, disbursements and expenses
of the Collateral Trustee's agents and counsel.
(c) The Company and the Guarantors shall indemnify the Collateral Trustee
against any and all losses, liabilities or expenses incurred by it arising out
of or in connection with the acceptance or administration of its duties under
this Indenture, the Intercreditor Agreement and the Security Documents,
including the costs and expenses of enforcing this Indenture, the Intercreditor
Agreement or the Security Documents against the Company and the Guarantors
(including this Section 12.06) and defending itself against any claim (whether
asserted by the Company, the Guarantors or any Holder or any other Person) or
liability in connection with the exercise or performance of any of its powers or
duties hereunder, or under the Intercreditor Agreement and the Security
Documents except to the extent any such loss, liability or expense may be
attributable to its negligence or bad faith. The Collateral Trustee shall notify
the Company promptly of any claim for which it may seek indemnity. Failure by
the Collateral Trustee to so notify the Company shall not relieve the Company or
any of the Guarantors of their obligations hereunder. The Company or such
Guarantor shall defend the claim and the Collateral Trustee shall cooperate in
the defense. The Collateral Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. Neither the Company
nor any Guarantor need pay for any settlement made without its consent, which
consent shall not be unreasonably withheld.
108
(d) The obligations of the Company and the Guarantors under this Section
12.06 shall survive the satisfaction and discharge of this Indenture.
(e) To secure the Company's payment obligations in this Section 12.06, the
Collateral Trustee shall have a Lien prior to the Notes and pari passu with the
Lien created pursuant to Section 7.07 hereof on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien shall survive the satisfaction and
discharge of this Indenture.
(f) When the Collateral Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.01(9) or (10) hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
ARTICLE 13.
SATISFACTION AND DISCHARGE
Section 13.01 Satisfaction and Discharge.
This Indenture shall be discharged and shall cease to be of further effect
as to all Notes of a particular series issued hereunder, when:
(1) either:
(A) all Notes of such series that have been authenticated
(except lost, stolen or destroyed Notes that have been replaced or
paid and Notes for whose payment money has theretofore been deposited
in trust and thereafter repaid to the Company) have been delivered to
the Trustee for cancellation; or
(B) all Notes of such series that have not been delivered to the
Trustee for cancellation have become due and payable by reason of the
making of a notice of redemption or otherwise or shall become due and
payable within one year and the Company or any Guarantor has
irrevocably deposited or caused to be deposited with the Trustee as
trust funds in trust solely for the benefit of the Holders, cash in
U.S. dollars, non-callable Government Securities, or a combination
thereof, in such amounts as shall be sufficient without consideration
of any reinvestment of interest, to pay and discharge the entire
indebtedness on the Notes not delivered to the Trustee for
cancellation for principal, premium, if any, and accrued interest to
the date of maturity or redemption;
(2) no Default or Event of Default has occurred and is continuing on
the date of such deposit (other than a Default or an Event of Default
resulting from the borrowing of funds to be applied to such deposit) and
such deposit shall not result in a breach or violation of, or constitute a
default under, any other instrument to which the Company or any Guarantor
is a party or by which the Company or any Guarantor is bound;
(3) the Company or any Guarantor has paid or caused to be paid all
sums payable by it under this Indenture; and
(4) the Company has delivered irrevocable instructions to the Trustee
under this Indenture to apply the deposited money toward the payment of the
Notes of such series at maturity or the redemption date, as the case may
be.
109
In addition, the Company must deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, if money
has been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the provisions of Section 13.02 and Section 8.06 shall survive. In
addition, nothing in this Section 13.01 shall be deemed to discharge those
provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.
Section 13.02 Application of Trust Money.
Subject to the provisions of Section 8.06, all money deposited with the
Trustee pursuant to Section 13.01 shall be held in trust and applied by it, in
accordance with the provisions of such series of Notes and this Indenture, to
the payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and interest for whose
payment such money has been deposited with the Trustee; but such money need not
be segregated from other funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or Government
Securities in accordance with Section 13.01 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
and any Guarantor's obligations under this Indenture and the relevant series of
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 13.01; provided that if the Company has made any payment of principal
of, premium, if any, or interest on any Notes because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or Government Securities held
by the Trustee or Paying Agent.
ARTICLE 14.
MISCELLANEOUS
Section 14.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA Section 318(c), the imposed duties shall control.
Section 14.02 Notices.
Any notice or communication by the Company, any Guarantor or the Trustee to
the others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company and/or any Guarantor:
Dynegy Holdings Inc.
0000 Xxxxxxxxx Xx., Xxxxx 0000
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attn: Xxxxx Xxxxxxxx
110
With a copy to:
O'Melveny & Xxxxx LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Fax No.: (000) 000-0000
Attn: Xxxx Xxxxxxx
If to the Trustee:
Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
Attn: Corporate Capital Markets
If to the Collateral Trustee:
Xxxxx Fargo Bank Minnesota, N.A.
Sixth and Marquette
MAC X0000-000
Xxxxxxxxxxx, XX 00000
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxx
The Company, any Guarantor, the Trustee or the Collateral Trustee, by
notice to the others may designate additional or different addresses for
subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier,
if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register kept
by the Registrar. Any notice or communication shall also be so mailed to any
Person described in TIA Section 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
Section 14.03 Communication by Holders of Notes with Other Holders of Notes.
111
Holders may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
Section 14.04 Certificate and Opinion 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:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 14.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 14.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.
Section 14.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) must comply with the provisions of TIA
Section 314(e) and must include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) 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 are based;
(3) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or
condition has been satisfied; and
(4) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied; provided, however, that with
respect to matters of fact, an Opinion of Counsel may rely on an Officers'
Certificate or certificates of public officials.
Section 14.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 14.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Guarantor, as such, shall have any liability
for any obligations of the Company or the Guarantors under this Indenture, the
Notes, the Note Guarantees, the Security Documents, or for any claim based on,
in respect of, or by reason of, such obligations or their creation. Each Holder
of Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for
112
issuance of the Notes. The waiver may not be effective to waive liabilities
under the federal securities laws.
Section 14.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE SECURITY DOCUMENTS, THE NOTES, AND THE NOTE
GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO
THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
Section 14.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 14.10 Successors.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 14.11 Severability.
In case any provision in this Indenture or in the Notes is invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 14.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 14.13 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
113
SIGNATURES
Dated as of August 11, 2003
Dynegy Holdings inc.
By: /s/ Xxxxxxx Xxxx
------------------------------------
Title: Assistant Treasurer
Dynegy Inc.
BG Holdings, Inc.
Illinova Corporation
Illinova Energy Partners, Inc.
Illinova Generating Company
Igc Xxxxxx County, Inc.
Igc Xxxxxx Frontier, Inc.
Ipg Ferndale, Inc.
Ipg Paris, Inc.
Charter Oak (Paris), Inc.
By: /s/ Xxxxxx X. Xxx
------------------------------------
Title: Sr. Vice President and
Treasurer
[continued]
114
Dynegy Power Corp. DPC II inc.
Dynegy Services, Inc. Dynegy Power Management Services, L.P.,
By: Dynegy Services, Inc., its general
partner
Dynegy Engineering, Inc. Calcasieu Power, Inc.
Dynegy Operating Company Dynegy Parts And Technical Services,
Inc.
Dynegy Power Management Services, Inc. Hep Cogen, Inc.
Xxxxxxxx Xxxxx, Inc. Dynegy Power Investments, Inc.
Dynegy Power Services, Inc. Dynegy Power Nevada, Inc.
Michigan Cogen, Inc. Michigan Power, Inc.
Michigan Power Holdings, Inc. OCG Cogen, Inc.
Oyster Creek Cogen, Inc. RRP Company
DPC Colombia - Opon Power Resources Termo Santander Holding, LLC
Company
Riverside Generation, Inc. Riverside Generating Company, L.L.C.
Rolling Hills Generation, Inc. Dynegy Renaissance Power, Inc.
Dynegy Northeast Generation, Inc. Xxxxxx Power, L.L.C.
Dynegy Midstream GP, Inc. DYNEGY LIQUIDS G.P., L.L.C.
By: Dynegy Midstream Service, Limited
Partnership, its sole member
By: Dynegy Midstream G.P., Inc. its
general partner
On behalf of each of the entities On behalf of each of the entities
listed above: listed above:
By: /s/ Xxxxxx X. Xxx By: /s/ Xxxxxx X. Xxx
--------------------------------- -------------------------------------
Title: Sr. Vice President and Title: Sr. Vice President and
Treasurer Treasurer
115
Dynegy Midstream Services, Limited Dynegy Liquids Marketing And Trade
Partnership
By: Dynegy Midstream G.P., Inc.,
its general partner
Dynegy OPI, LLC Dynegy NGL Pipeline Company, LLC
Dynegy Intrastate Pipeline, LLC Dynegy Energy Pipeline Company LLC
Dynegy Upper Holdings, L.L.C. Dmg Enterprises, Inc.
Havana Dock Enterprises, LLC Dmt Holdings, Inc.
DMT G.P., L.L.C. Dmt Holdings, L.P.
By: DMT G.P.,
L.L.C., its general partner
Dynegy Coal Trading & Transportation, Ngc Storage, Inc.
L.L.C.
Black Thunder Member, Inc. Parish Power, Inc.
Calcasieu Power, L.L.C. Delta Cogen, Inc.
Cogen Power, Inc. Cogen Power, L.P.
By: CoGen Power,
Inc., its general partner
Dynegy Power Holdings, Inc. Midstream Barge Company, L.L.C.
Dynegy Regulated Holdings, LLC Black Mountain Cogen, Inc.
Bluegrass Generation, Inc. Bluegrass Generation Company, L.L.C.
Dynegy Cabrillo II LLC Dynegy Holding Company, L.L.C.
On behalf of each of the entities On behalf of each of the entities listed
listed above: above:
By: /s/ Xxxxxx X. Xxx By: /s/ Xxxxxx X. Xxx
---------------------------------- ------------------------------------
Title: Sr. Vice President and Title: Sr. Vice President and
Treasurer Treasurer
000
Xxxx Xxxxx Generation Inc. Blue Ridge Generation Llc
Chickahominy Generating Company Chickahominy Power, Llc
Florida Mercantile Power, Inc. Palmetto Power, L.L.C.
Gasification Services, Inc. Georgia Mercantile Power, Inc.
Heard County Power, L.L.C. Xxxx County IPP, Inc.
Hartwell INDEPENDENT POWER PARTNERS, Hartwell Power Company
INC.
Dynegy Roseton, L.L.C. Dynegy Xxxxxx Power Retail, L.L.C.
Dynegy Global Energy, Inc. Dynegy Broadband Marketing And Trade
Dynegy GP INC. Dynegy Marketing And Trade
By: Dynegy GP, Inc.
its general partner
Dynegy Technology Capital Corp. Dynegy Strategic Investments GP, L.L.C.
Dynegy Strategic Investments, L.P. Renaissance Power, L.L.C.
By: Dynegy Strategic Investments GP,
L.L.C., its general partner
Rolling Hills Generating, L.L.C. Dynegy Power Marketing, Inc.
Dynegy Energy Services, Inc. Illinois Power Energy, Inc.
Des Northeast, Inc.
On behalf of each of the entities On behalf of each of the entities listed
listed above: above:
By: /s/ Xxxxxx X. Xxx By: /s/ Xxxxxx X. Xxx
----------------------------------- -----------------------------------
Title: Sr. Vice President and Title: Sr. Vice President and
Treasurer Treasurer
117
Dem GP, LLC Dynegy Energy Marketing, Lp
By: DEM GP, LLC, its
general partner
Dynegy Administrative Services Company NIPC, Inc.
DFS L.P., LLC Dynegy Xxxxxx Member, Inc.
Dfs General Partner, LLC Dynegy Financial Services, Limited
Partnership
By: DFS General Partner, LLC,
its general partner
Dynegy Midwest Generation , Inc. Dynegy I.T., Inc.
Chesapeake Power, Inc. Xxxxx River Energy Corp.
DPC Power Resources Holding Company Dry Creek Power, Inc.
Rockingham Power, L.L.C. Dynegy Power Development Company
On behalf of each of the entities On behalf of each of the entities listed
listed above: above:
By: /s/ Xxxxxx X. Xxx By: /s/ Xxxxxx X. Xxx
---------------------------------- -----------------------------------
Title: Sr. Vice President and Title: Sr. Vice President and
Treasurer Treasurer
Dynegy Danskammer, L.L.C.
By: /s/ Xxxxxxx Xxxx
------------------------------------
Title: Assistant Treasurer
Dynegy Management, Inc.
DMS LP, Inc.
DMT L.P., L.L.C.
Dynegy Strategic Investments LP, Inc.
DEM LP, LLC
By: /s/ J. Xxxxx Xxxxxxxx
------------------------------------
Title: Assistant Secretary
118
Wilmington Trust Company
as Trustee
By: /s/ Xxxxx X. XxXxxxxx
------------------------------------
Title: Authorized Signatory
Xxxxx Fargo Bank Minnesota, N.A.
as Collateral Trustee
By: /s/ Xxxxxxx Xxxx
------------------------------------
Title: Corporate Trust Officer
119
Schedule I
Guarantors
Dynegy Inc.
Dynegy Power Corp.
Dynegy Midstream Services, Limited Partnership
Blue Ridge Generation Inc.
BG Holdings, Inc.
Dynegy Services, Inc.
Dynegy OPI, LLC
Chickahominy Generating Company
Illinova Corporation
Dynegy Engineering, Inc.
Dynegy Intrastate Pipeline, LLC
Florida Mercantile Power, Inc.
Illinova Energy Partners, Inc.
Dynegy Operating Company
Dynegy Upper Holdings, L.L.C.
Gasification Services, Inc.
Illinova Generating Company
Dynegy Power Management Services, Inc.
Havana Dock Enterprises, LLC
Heard County Power, L.L.C.
IGC Xxxxxx County, Inc.
Xxxxxxxx Xxxxx, Inc.
DMT G.P., L.L.C.
Hartwell Independent Power Partners, Inc.
IGC Xxxxxx Frontier, Inc.
Dynegy Power Services, Inc.
Dynegy Coal Trading & Transportation, L.L.C.
Dynegy Roseton, L.L.C.
IPG Ferndale, Inc.
Michigan Cogen, Inc.
Black Thunder Member, Inc.
Dynegy Global Energy, Inc.
IPG Paris, Inc.
Michigan Power Holdings, Inc.
Calcasieu Power, L.L.C.
Dynegy GP Inc
Charter Oak (Paris), Inc.
Oyster Creek Cogen, Inc.
Cogen Power, Inc.
Dynegy Technology Capital Corp.
DPC II Inc.
DPC Colombia - Opon Power Resources Company
Dynegy Power Holdings, Inc.
Dynegy Strategic Investments, L.P.
Dynegy Power Management Services, L.P.,
Riverside Generation, Inc.
Dynegy Regulated Holdings, LLC
I-1
Rolling Hills Generating, L.L.C.
Calcasieu Power, Inc.
Rolling Hills Generation, Inc.
Bluegrass Generation, Inc.
Dynegy Energy Services, Inc.
Dynegy Parts and Technical Services, Inc.
Dynegy Northeast Generation, Inc.
Dynegy Cabrillo II LLC
Des Northeast, Inc.
HEP Cogen, Inc.
Dynegy Midstream GP, Inc.
Dynegy Liquids Marketing And Trade
Dem GP, LLC
Dynegy Power Investments, Inc.
Blue Ridge Generation LLC
Dynegy NGL Pipeline Company, LLC
Dynegy Administrative Services Company
Dynegy Power Nevada, Inc.
Chickahominy Power, LLC
Dynegy Energy Pipeline Company LLC
DFS L.P., LLC
Michigan Power, Inc.
Palmetto Power, L.L.C.
DMG Enterprises, Inc.
DFS General Partner, LLC
OCG Cogen, Inc.
Georgia Mercantile Power, Inc.
DMT Holdings, Inc.
Dynegy Midwest Generation , Inc.
RRP Company
Xxxx County IPP, Inc.
DMT Holdings, L.P.
Chesapeake Power, Inc.
Termo Santander Holding, LLC
Hartwell Power Company
NGC Storage, Inc.
DPC Power Resources Holding Company
Riverside Generating Company, L.L.C.
Dynegy Xxxxxx Power Retail, L.L.C.
Parish Power, Inc.
Rockingham Power, L.L.C.
Dynegy Renaissance Power, Inc.
Dynegy Broadband Marketing And Trade
Delta Cogen, Inc.
Dynegy Energy Marketing, XX
Xxxxxx Power, L.L.C.
Dynegy Marketing And Trade
Cogen Power, L.P.
NIPC, Inc.
Dynegy Liquids G.P., L.L.C.
Dynegy Strategic Investments GP, L.L.C.
I-2
Midstream Barge Company, L.L.C.
Dynegy Xxxxxx Member, Inc.
Dynegy Danskammer, L.L.C.
Renaissance Power, L.L.C.
Black Mountain Cogen, Inc.
Dynegy Financial Services, Limited Partnership
Dynegy Management, Inc.
Dynegy Power Marketing, Inc.
Bluegrass Generation Company, L.L.C.
Dynegy I.T., Inc.
DMS LP, Inc.
Illinois Power Energy, Inc.
Dynegy Holding Company, L.L.C.
Xxxxx River Energy Corp.
DEM LP, LLC
Dynegy Strategic Investments LP, Inc.
DMT L.P., L.L.C.
Dry Creek Power, Inc.
Dynegy Power Development Company
I-3
EXHIBIT A1
[Face of Note]
================================================================================
CUSIP/CINS ____________
Second Priority Senior Secured Floating Rate Notes due 2008
No. ___ $____________
DYNEGY HOLDINGS INC.
promises to pay to _____________________________________________________________
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on July 15, 2008.
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated: _______________, 200_
DYNEGY HOLDINGS INC.
By:
------------------------------------
Name:
Title:
(SEAL)
This is one of the Series A Notes referred
to in the within-mentioned Indenture:
WILMINGTON TRUST COMPANY
as Trustee
By:
---------------------------------------
Authorized Signatory
================================================================================
A1-1
[Back of Note]
Second Priority Senior Secured Floating Rate Notes due 2008
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used hereof have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) Interest. Dynegy Holdings Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note
at a rate per annum equal to the Applicable Eurodollar Rate, as defined in
the Indenture, in effect during each quarterly period commencing January
15, April 15, July 15 and October 15 of each year from August 11, 2003
until maturity. The interest rate on the Series A Notes will in no event be
higher than the maximum rate permitted by New York law as the same may be
modified by U.S. law of general application. Under current New York law,
the maximum rate of interest is 25% per annum on a simple interest basis.
This limit may not apply to Series A Notes in which $2,500,000 or more has
been invested. The Company shall pay interest semi-annually in arrears on
January 15 and July 15 of each year, or if any such day is not a Business
Day, on the next succeeding Business Day (each, an "Interest Payment
Date"). Interest on the Notes shall accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record
date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further, that the first Interest Payment Date shall
be January 15, 2004. The Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium, if any, from time to time on demand at a
rate that is 1% per annum in excess of the rate then in effect; it shall
pay interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to
the extent lawful. Interest shall be computed on the basis of a 360-day
year of twelve 30-day months. All percentages resulting from any of the
calculations in this paragraph (1) will be rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards and all dollar amounts
used in or resulting from such calculations will be rounded to the nearest
cent with one-half cent being rounded upwards. For example, 9.876545% or
.09876545 will be rounded to 9.87655% or .0987655.
(2) Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of
Notes at the close of business on the January 1 or July 1 next preceding
the Interest Payment Date, even if such Notes are canceled after such
record date and on or before such Interest Payment Date, except as provided
in Section 2.12 of the Indenture with respect to defaulted interest. The
Notes shall be payable as to principal, premium, if any, and interest at
the office or agency of the Company maintained for such purpose within or
without the City and State of New York, or, at the option of the Company,
payment of interest may be made by check mailed to the Holders at their
addresses set forth in the register of Holders; provided that payment by
wire transfer of immediately available funds shall be required with respect
to principal of and interest, premium on, all Global Notes and all other
Notes the Holders of which shall have provided wire transfer instructions
reasonably in advance to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the
X0-0
Xxxxxx Xxxxxx xx Xxxxxxx as at the time of payment is legal tender for
payment of public and private debts.
(3) Paying Agent and Registrar. Initially, Wilmington Trust Company,
the Trustee under the Indenture, shall act as Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such
capacity.
(4) Indenture. The Company issued the Notes under an Indenture dated
as of August 11, 2003 (the "Indenture") among the Company, the Guarantors,
the Trustee and Xxxxx Fargo Bank Minnesota, N.A., as collateral trustee.
The terms of the Notes include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939, as
amended (15 U.S. Code Sections 77aaa-77bbbb). The Notes are subject to all
such terms, and Holders are referred to the Indenture and such Act for a
statement of such terms. To the extent any provision of this Note conflicts
with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are secured
obligations of the Company initially issued in $225 million in aggregate
principal amount, and the Company may issue an unlimited amount of
additional Notes of this series under the Indenture, subject to compliance
with Section 4.09 of the Indenture. The Notes are secured by the Indenture
and the Security Documents.
(5) Guarantees. The Notes are guaranteed by Dynegy Inc., the parent
of the Company, certain other Affiliates of the Company and by all of the
Company's wholly-owned Domestic Subsidiaries that guarantee borrowings
under the Company's Credit Agreement as of August 11, 2003. The Note
Guarantees are the full and unconditional and joint and several general
obligations of the Guarantors. The Note Guarantees are secured, on a second
priority basis, by substantially all of the same assets that secure the
guarantees by the Guarantors of the Company's obligations under the Credit
Agreement.
(6) Optional Redemption.
At any time prior to July 15, 2006, the Company may on any one or more
occasions redeem up to 35% of the aggregate principal amount of the Series
A Notes issued hereunder at a redemption price equal to par plus the
Applicable Eurodollar Rate then in effect, plus accrued and unpaid interest
to the redemption date, with a contribution to the Company's common equity
capital made with the net cash proceeds of a concurrent sale of common
stock of Dynegy; provided that:
(A) at least 65% of the aggregate principal amount of the
Series A Notes issued under the Indenture (excluding Notes held
by the Company or any of its Affiliates) remains outstanding
immediately after the occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
At any time prior to July 15, 2006, the Company may redeem all but not less
than all of the Series A Notes upon the occurrence of a Change of Control,
upon not less than 30 nor more than 60 days prior notice (but in any event
no earlier than the date of consummation of such Change of Control and no
later than 90 days after the occurrence of such Change of Control) at a
redemption price equal to the principal amount of the Series A Notes
redeemed plus the Applicable Premium for Series A Notes as of, and accrued
and unpaid interest, if any, to the date of redemption,
A1-3
subject to the rights of Holders on the relevant record date to receive
interest on the relevant interest payment date. This optional redemption by
the Company is separate from and in addition to the rights of Holders as
set forth in Section 4.15 of the Indenture.
On or after July 15, 2006, the Company may redeem all or a part of the
Series A Notes upon not less than 30 nor more than 60 days notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest on the Series A Notes redeemed, to
the applicable redemption date, if redeemed during the twelve-month period
beginning on July 15 of the years indicated below, subject to the rights of
Holders on the relevant record date to receive interest on the relevant
interest payment date:
Year Percentage
---- ----------
2006 ................................... 103.000%
2007 ................................... 101.000%
2008 ................................... 100.000%
Unless the Company defaults in the payment of the redemption price,
interest shall cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(7) Mandatory Redemption. The Company is not required to make
mandatory redemption or sinking fund payments with respect to the Notes.
(8) Repurchase At Option Of Holder.
If there is a Change of Control, the Company shall be required to make
an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid thereon, if any, to the date of purchase subject to the
rights of Holders on the relevant record date to receive interest due on
the relevant interest payment date. Within 30 days following any Change of
Control, the Company shall mail a notice to each holder describing the
transaction or transactions that constitute the Change of Control and
offering to repurchase Notes on the Change of Control Payment Date
specified in the notice, which date shall be no earlier than 30 days and no
later than 60 days from the date such notice is mailed, pursuant to the
procedures required by the Indenture and described in such notice.
If Dynegy or any of its Restricted Subsidiaries consummate any Asset
Sales, when the aggregate amount of Excess Proceeds exceeds $50.0 million
or at such earlier time as the Company may elect, the Company shall make an
Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in the Indenture with respect to offers to
purchase or redeem with the proceeds of sales of assets (an "Asset Sale
Offer") pursuant to Section 3.09 of the Indenture to purchase the maximum
principal amount of Notes (including any Additional Notes) and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds to
the extent required by the indentures governing other Indebtedness. The
offer price in any Asset Sale Offer shall be equal to 100% of principal
amount plus accrued and unpaid interest to the date of purchase, and shall
be payable in cash. If any Excess Proceeds remain after consummation of an
Asset Sale Offer, such Excess Proceeds shall be released from the Cash
Collateral Account and the Company may use those Excess Proceeds for any
purpose not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness tendered into
such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Holders of Notes that are the
A1-4
subject of an offer to purchase will receive an Asset Sale Offer from the
Company prior to any related purchase date and may elect to have such Notes
purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.
(9) Notice of Redemption. Notice of redemption will be mailed by
first class mail at least 30 days but not more than 60 days before a
redemption date to each Holder whose Notes are to be redeemed at its
registered address, except that a redemption notice may be mailed more than
60 days prior to a redemption date if the notice is issued in connection
with a defeasance of the Notes or a satisfaction and discharge of the
Indenture. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes held by
a Holder are to be redeemed. On and after the redemption date interest
ceases to accrue on Notes or portions thereof called for redemption.
(10) Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged
as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture. The Company need
not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(11) Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
(12) Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture, the Note Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Series A Notes voting as a single
class, and any existing default or compliance with any provision of the
Indenture, the Notes or the Note Guarantees may be waived with the consent
of the Holders of a majority in principal amount of the then outstanding
Series A Notes voting as a single class. Without the consent of any Holder
of a Note, the Indenture, the Notes or the Note Guarantees may be amended
or supplemented to cure any ambiguity, defect or inconsistency, to provide
for uncertificated Notes in addition to or in place of certificated Notes,
to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of the Notes in case of a merger or consolidation,
to make any change that would provide any additional rights or benefits to
the Holders of the Notes or that does not adversely affect the legal rights
under the Indenture of any such Holder, to comply with the requirements of
the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act, to provide for the Issuance of Additional
Notes in accordance with the limitations set forth in the Indenture, to
allow any Guarantor to execute a supplemental indenture to the Indenture
and/or a Note Guarantee with respect to the Notes, to make, complete or
confirm any grant of Collateral permitted or required by the Indenture or
any release of Collateral that becomes effective as set forth in the
Indenture, to reflect any waiver or termination of any right arising under
Article 11 of the Indenture that otherwise would be enforceable by any
holder of a Parity Lien Obligation or Parity Lien, if such waiver or
termination is set forth or provided in the Indenture or agreement
governing or giving rise to such Parity Lien Obligation or Parity Lien
(provided, that no such waiver or amendment pursuant to clause (9) of
Section 9.01 of the Indenture shall adversely affect the rights of the
Holders), or to conform the text of the Indenture, the Notes, the Note
Guarantees or the Security
A1-5
Documents to any provision that was contained in the Offering Circular,
dated as of August 1, 2003, that was used by the Initial Purchasers in
connection with the distribution of the Initial Notes to the extent that
such document contained a description of any provision of the Indenture,
the Notes, the Note Guarantees or the Security Documents that was intended
to be a verbatim recitation of such provision.
(13) Defaults and Remedies. Each of the following is an Event of
Default for the Series A Notes: (i) default for 30 days in the payment when
due of interest on any Series A Notes; (ii) default in payment when due of
the principal of, or premium, if any, on any Series A Notes; (iii) failure
by Dynegy or any of its Restricted Subsidiaries to comply with the
provisions described in Sections 4.07, 4.09, 4.10, 4.15 or 5.01 of the
Indenture for 30 days after written notice from the Trustee or the holders
of at least 25% in aggregate principal amount of the Series A Notes then
outstanding to comply with such provisions; (iv) failure by Dynegy or any
of its Restricted Subsidiaries for 60 days after written notice from the
Trustee or the holders of at least 25% in aggregate principal amount of the
Series A Notes then outstanding to comply with any of the other agreements
in the Indenture or the Security Documents; (v) default under any mortgage,
indenture or instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness for money borrowed by Dynegy
or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by Dynegy or any of its Restricted Subsidiaries) whether such
Indebtedness or guarantee now exists, or is created after the date of the
Indenture, if that default: (x) is caused by a failure to pay principal of,
or interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of
such default (a "Payment Default") or (y) results in the acceleration of
such Indebtedness prior to its express maturity, and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a Payment
Default or the maturity of which has been so accelerated, aggregates $50.0
million or more; provided that, if such default shall be remedied or cured
by Dynegy or such Restricted Subsidiary or waived by the holder of such
Indebtedness, in each case before acceleration of the Notes, then the Event
of Default under the Indenture caused by reason thereof shall be deemed
likewise to have been remedied, cured or waived without further action on
the part of the Trustee, any holder of Notes or any other Person; (vi)
failure by Dynegy or any of its Restricted Subsidiaries to pay final and
non-appealable judgments aggregating in excess of $50.0 million, which are
not covered by indemnities or third party insurance, which judgments are
not paid, discharged, vacated or stayed for a period of 60 days; (vii)
breach by Dynegy or any of its Restricted Subsidiaries of any
representation or warranty or agreement in the Security Documents, the
repudiation by Dynegy or any of its Restricted Subsidiaries of any of its
obligations under the Security Documents or the unenforceability of the
Security Documents against Dynegy or any of its Restricted Subsidiaries for
any reason; (viii) except as permitted by the Indenture, the Guarantee of
the Notes by Dynegy, Illinova or any Significant Subsidiary of the Company
shall be held in any judicial proceeding to be unenforceable or invalid or
shall cease for any reason to be in full force and effect or Dynegy,
Illinova or any Subsidiary Guarantor that is a Significant Subsidiary of
the Company, or any Person acting on behalf of any such Guarantor, shall
deny or disaffirm its obligations under its Guarantee; and (ix) certain
events of bankruptcy or insolvency described in the indenture with respect
to Dynegy or any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken together,
would constitute a Significant Subsidiary. If any Event of Default occurs
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Series A Notes may declare all such Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event
of Default arising from certain events of bankruptcy or insolvency, all
outstanding Series A Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Series A
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in
A1-6
principal amount of the then outstanding Series A Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders of the Series A Notes notice of any continuing Default or
Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines that withholding notice
is in their interest. The Holders of a majority in aggregate principal
amount of the Series A Notes then outstanding by notice to the Trustee may
on behalf of the Holders of all of the Series A Notes waive any existing
Default or Event of Default and its consequences under the Indenture except
a continuing Default or Event of Default in the payment of interest on, or
the principal of, the Series A Notes. The Company is required to deliver to
the Trustee annually a statement regarding compliance with the Indenture,
and the Company is required upon becoming aware of any Default or Event of
Default, to deliver to the Trustee a statement specifying such Default or
Event of Default.
(14) Lien Subordination And Sharing. The Notes, the Note Guarantees
and the other Note Obligations are secured by Note Liens upon the
Collateral pursuant to the Security Documents. The Note Liens are
subordinate in ranking to all current and future Priority Liens and of
equal ranking with all current and future Parity Liens as set forth in
Article 10 of the Indenture. The Notes, the Note Guarantees and the other
Note Obligations are secured by Note Liens upon the Collateral pursuant to
the Security Documents. The Note Liens are subordinate in ranking to all
current and future Priority Liens and of equal ranking with all current and
future Parity Liens as set forth in Article 11 of the Indenture.
(15) 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 the Trustee.
(16) No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, shall not have any liability for any obligations of the Company or
such Guarantor under the Notes, the Note Guarantees, the Indenture or the
Security Documents or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of the Notes.
(17) Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
(18) Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
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).
(19) CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Notes or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
A1-7
Attention: Dynegy Holdings Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Investor Relations
(000) 000-0000
A1-8
EXHIBIT A2
[Face of Note]
================================================================================
CUSIP/CINS_____________
9.875% Second Priority Senior Secured Notes due 2010
No.____ $____________
DYNEGY HOLDINGS INC.
promises to pay to _____________________________________________________________
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on July 15, 2010
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated: _______________, 200_
DYNEGY HOLDINGS INC.
By:
-------------------------------------
Name:
Title:
(SEAL)
This is one of the Series B Notes
referred to in the within-mentioned
Indenture:
WILMINGTON TRUST COMPANY
as Trustee
By:
-------------------------------------
Authorized Signatory
================================================================================
A2-1
[Back of Note]
9.875% Second Priority Senior Secured Notes due 2010
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used hereof have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) Interest. Dynegy Holdings Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note
at the rate of 9.875% per annum. The Company shall pay interest
semi-annually in arrears on January 15 and July 15 of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each,
an "Interest Payment Date"). Interest on the Notes shall accrue from the
most recent date to which interest has been paid or, if no interest has
been paid, from the date of issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first
Interest Payment Date shall be January 15, 2004. The Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time
on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest shall be computed on
the basis of a 360-day year of twelve 30-day months.
(2) Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of
Notes at the close of business on the January 1 or July 1 next preceding
the Interest Payment Date, even if such Notes are canceled after such
record date and on or before such Interest Payment Date, except as provided
in Section 2.12 of the Indenture with respect to defaulted interest. The
Notes shall be payable as to principal, premium, if any, and interest at
the office or agency of the Company maintained for such purpose within or
without the City and State of New York, or, at the option of the Company,
payment of interest may be made by check mailed to the Holders at their
addresses set forth in the register of Holders; provided that payment by
wire transfer of immediately available funds shall be required with respect
to principal of and interest, premium on, all Global Notes and all other
Notes the Holders of which shall have provided wire transfer instructions
reasonably in advance to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
(3) Paying Agent and Registrar. Initially, Wilmington Trust Company,
the Trustee under the Indenture, shall act as Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such
capacity.
(4) Indenture. The Company issued the Notes under an Indenture dated
as of August 11, 2003 (the "Indenture") among the Company, the Guarantors,
the Trustee and Xxxxx Fargo Bank Minnesota, N.A., as collateral trustee.
The terms of the Notes include those stated in the
A2-2
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling.
The Notes are secured obligations of the Company initially issued in $525
million in aggregate principal amount, and the Company may issue an
unlimited amount of additional Notes of this series under the Indenture,
subject to compliance with Section 4.09 of the Indenture. The Notes are
secured by the Indenture and the Security Documents.
(5) Guarantees. The Notes are guaranteed by Dynegy Inc., the parent
of the Company, certain other Affiliates of the Company and by all of the
Company's wholly-owned Domestic Subsidiaries that guarantee borrowings
under the Company's Credit Agreement as of August 11, 2003. The Note
Guarantees are the full and unconditional and joint and several general
obligations of the Guarantors. The Note Guarantees are secured, on a second
priority basis, by substantially all of the same assets that secure the
guarantees by the Guarantors of the Company's obligations under the Credit
Agreement.
(6) Optional Redemption.
At any time prior to July 15, 2006, the Company may on any one or more
occasions redeem up to 35% of the aggregate principal amount of the Series
B Notes issued hereunder at a redemption price of 109.875% of the principal
amount, plus accrued and unpaid interest to the redemption date, with a
contribution to the Company's common equity capital made with the net cash
proceeds of a concurrent sale of common stock of Dynegy; provided that:
(A) at least 65% of the aggregate principal amount of the Series
B Notes issued under the Indenture (excluding Notes held by the
Company or any of its Affiliates) remains outstanding immediately
after the occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
At any time prior to July 15, 2007, the Company may redeem all but not less
than all of the Series B Notes upon the occurrence of a Change of Control,
upon not less than 30 nor more than 60 days prior notice (but in any event
no earlier than the date of consummation of such Change of Control and no
later than 90 days after the occurrence of such Change of Control) at a
redemption price equal to the principal amount of the Series B Notes
redeemed plus the Applicable Premium for Series B Notes as of, and accrued
and unpaid interest, if any, to the date of redemption, subject to the
rights of Holders on the relevant record date to receive interest on the
relevant interest payment date. This optional redemption by the Company is
separate from and in addition to the rights of Holders as set forth in
Section 4.15 of the Indenture.
On or after July 15, 2007, the Company may redeem all or a part of the
Series B Notes upon not less than 30 nor more than 60 days notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest on the Series B Notes redeemed, to
the applicable redemption date, if redeemed during the twelve-month period
beginning on July 15 of the years indicated below, subject to the rights of
Holders on the relevant record date to receive interest on the relevant
interest payment date:
A2-3
Year Percentage
---- ----------
2007........................................ 104.938%
2008........................................ 102.469%
2009 and thereafter......................... 100.000%
Unless the Company defaults in the payment of the redemption price,
interest shall cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(7) Mandatory Redemption. The Company is not required to make
mandatory redemption or sinking fund payments with respect to the Notes.
(8) Repurchase At Option of Holder.
If there is a Change of Control, the Company shall be required to make
an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid thereon, if any, to the date of purchase subject to the
rights of Holders on the relevant record date to receive interest due on
the relevant interest payment date. Within 30 days following any Change of
Control, the Company shall mail a notice to each holder describing the
transaction or transactions that constitute the Change of Control and
offering to repurchase Notes on the Change of Control Payment Date
specified in the notice, which date shall be no earlier than 30 days and no
later than 60 days from the date such notice is mailed, pursuant to the
procedures required by the Indenture and described in such notice.
If Dynegy or any of its Restricted Subsidiaries consummate any Asset
Sales, when the aggregate amount of Excess Proceeds exceeds $50.0 million
or at such earlier time as the Company may elect, the Company shall make an
Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in the Indenture with respect to offers to
purchase or redeem with the proceeds of sales of assets (an "Asset Sale
Offer") pursuant to Section 3.09 of the Indenture to purchase the maximum
principal amount of Notes (including any Additional Notes) and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds to
the extent required by the indentures governing other Indebtedness. The
offer price in any Asset Sale Offer shall be equal to 100% of principal
amount plus accrued and unpaid interest to the date of purchase, and shall
be payable in cash. If any Excess Proceeds remain after consummation of an
Asset Sale Offer, such Excess Proceeds shall be released from the Cash
Collateral Account and the Company may use those Excess Proceeds for any
purpose not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness tendered into
such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Holders of Notes that are the subject of an
offer to purchase will receive an Asset Sale Offer from the Company prior
to any related purchase date and may elect to have such Notes purchased by
completing the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes.
(9) Notice Of Redemption. Notice of redemption will be mailed by
first class mail at least 30 days but not more than 60 days before a
redemption date to each Holder whose Notes are to be redeemed at its
registered address, except that a redemption notice may be mailed more than
60 days prior to a redemption date if the notice is issued in connection
with a defeasance of the Notes or a satisfaction and discharge of the
Indenture. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes held by
a
A2-4
Holder are to be redeemed. On and after the redemption date interest ceases
to accrue on Notes or portions thereof called for redemption.
(10) Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged
as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture. The Company need
not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(11) Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
(12) Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture, the Note Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Series B Notes voting as a single
class, and any existing default or compliance with any provision of the
Indenture, the Notes or the Note Guarantees may be waived with the consent
of the Holders of a majority in principal amount of the then outstanding
Series B Notes voting as a single class. Without the consent of any Holder
of a Note, the Indenture, the Notes or the Note Guarantees may be amended
or supplemented to cure any ambiguity, defect or inconsistency, to provide
for uncertificated Notes in addition to or in place of certificated Notes,
to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of the Notes in case of a merger or consolidation,
to make any change that would provide any additional rights or benefits to
the Holders of the Notes or that does not adversely affect the legal rights
under the Indenture of any such Holder, to comply with the requirements of
the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act, to provide for the Issuance of Additional
Notes in accordance with the limitations set forth in the Indenture, or to
allow any Guarantor to execute a supplemental indenture to the Indenture
and/or a Note Guarantee with respect to the Notes, to make, complete or
confirm any grant of Collateral permitted or required by the Indenture or
any release of Collateral that becomes effective as set forth in the
Indenture, to reflect any waiver or termination of any right arising under
Article 11 of the Indenture that otherwise would be enforceable by any
holder of a Parity Lien Obligation or Parity Lien, if such waiver or
termination is set forth or provided in the Indenture or agreement
governing or giving rise to such Parity Lien Obligation or Parity Lien
(provided, that no such waiver or amendment pursuant to clause (9) of
Section 9.01 of the Indenture shall adversely affect the rights of the
Holders), or to conform the text of the Indenture, the Notes, the Note
Guarantees or the Security Documents to any provision that was contained in
the Offering Circular, dated as of August 1, 2003, that was used by the
Initial Purchasers in connection with the distribution of the Initial Notes
to the extent that such document contained a description of any provision
of the Indenture, the Notes, the Note Guarantees or the Security Documents
that was intended to be a verbatim recitation of such provision.
(13) Defaults and Remedies. Each of the following is an Event of
Default for the Series B Notes: (i) default for 30 days in the payment when
due of interest on any Series B Notes; (ii) default in payment when due of
the principal of, or premium, if any, on any Series B Notes; (iii) failure
by Dynegy or any of its Restricted Subsidiaries to comply with the
provisions
A2-5
described in Sections 4.07, 4.09, 4.10, 4.15 or 5.01 of the Indenture for
30 days after written notice from the Trustee or the holders of at least
25% in aggregate principal amount of the Series B Notes then outstanding to
comply with such provisions; (iv) failure by Dynegy or any of its
Restricted Subsidiaries for 60 days after written notice from the Trustee
or the holders of at least 25% in aggregate principal amount of the Series
B Notes then outstanding to comply with any of the other agreements in the
Indenture or the Security Documents; (v) default under any mortgage,
indenture or instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness for money borrowed by Dynegy
or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by Dynegy or any of its Restricted Subsidiaries) whether such
Indebtedness or guarantee now exists, or is created after the date of the
Indenture, if that default: (x) is caused by a failure to pay principal of,
or interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of
such default (a "Payment Default") or (y) results in the acceleration of
such Indebtedness prior to its express maturity, and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a Payment
Default or the maturity of which has been so accelerated, aggregates $50.0
million or more; provided that, if such default shall be remedied or cured
by Dynegy or such Restricted Subsidiary or waived by the holder of such
Indebtedness, in each case before acceleration of the Notes, then the Event
of Default under the Indenture caused by reason thereof shall be deemed
likewise to have been remedied, cured or waived without further action on
the part of the Trustee, any holder of Notes or any other Person; (vi)
failure by Dynegy or any of its Restricted Subsidiaries to pay final and
non-appealable judgments aggregating in excess of $50.0 million, which are
not covered by indemnities or third party insurance, which judgments are
not paid, discharged, vacated or stayed for a period of 60 days; (vii)
breach by Dynegy or any of its Restricted Subsidiaries of any
representation or warranty or agreement in the Security Documents, the
repudiation by Dynegy or any of its Restricted Subsidiaries of any of its
obligations under the Security Documents or the unenforceability of the
Security Documents against Dynegy or any of its Restricted Subsidiaries for
any reason; (viii) except as permitted by the Indenture, the Guarantee of
the Notes by Dynegy, Illinova or any Significant Subsidiary of the Company
shall be held in any judicial proceeding to be unenforceable or invalid or
shall cease for any reason to be in full force and effect or Dynegy,
Illinova or any Subsidiary Guarantor that is a Significant Subsidiary of
the Company, or any Person acting on behalf of any such Guarantor, shall
deny or disaffirm its obligations under its Guarantee; and (ix) certain
events of bankruptcy or insolvency described in the indenture with respect
to Dynegy or any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken together,
would constitute a Significant Subsidiary. If any Event of Default occurs
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Series B Notes may declare all such Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event
of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable without further action or
notice. Holders may not enforce the Indenture or the Series B Notes except
as provided in the Indenture. Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Series B Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or
Event of Default (except a Default or Event of Default relating to the
payment of principal or interest) if it determines that withholding notice
is in their interest. The Holders of a majority in aggregate principal
amount of the Series B Notes then outstanding by notice to the Trustee may
on behalf of the Holders of all of the Series B Notes waive any existing
Default or Event of Default and its consequences under the Indenture except
a continuing Default or Event of Default in the payment of interest on, or
the principal of, the Series B Notes. The Company is required to deliver to
the Trustee annually a statement regarding compliance with the Indenture,
and the
A2-6
Company is required upon becoming aware of any Default or Event of Default,
to deliver to the Trustee a statement specifying such Default or Event of
Default.
(14) Lien Subordination And Sharing. The Notes, the Note Guarantees
and the other Note Obligations are secured by Note Liens upon the
Collateral pursuant to the Security Documents. The Note Liens are
subordinate in ranking to all current and future Priority Liens and of
equal ranking with all current and future Parity Liens as set forth in
Article 10 of the Indenture. The Notes, the Note Guarantees and the other
Note Obligations are secured by Note Liens upon the Collateral pursuant to
the Security Documents. The Note Liens are subordinate in ranking to all
current and future Priority Liens and of equal ranking with all current and
future Parity Liens as set forth in Article 11 of the Indenture.
(15) 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 the Trustee.
(16) No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, shall not have any liability for any obligations of the Company or
such Guarantor under the Notes, the Note Guarantees, the Indenture or the
Security Documents or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of the Notes.
(17) Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
(18) Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
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).
(19) CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Notes or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Attention: Dynegy Holdings Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Investor Relations
(000) 000-0000
A2-7
EXHIBIT A3
[Face of Note]
================================================================================
CUSIP/CINS ____________
10.125% Second Priority Senior Secured Notes due 2013
No. ___ $____________
DYNEGY HOLDINGS INC.
promises to pay to______________________________________________________________
or registered assigns,
the principal sum of____________________________________________________________
Dollars on July 15, 2013
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated:_______________, 200_
DYNEGY HOLDINGS INC.
By:
------------------------------------
Name:
Title:
(SEAL)
This is one of the Series C Notes
referred to in the within-mentioned
Indenture:
WILMINGTON TRUST COMPANY
as Trustee
By:
------------------------------------
Authorized Signatory
================================================================================
A3-1
[Back of Note]
10.125% Second Priority Senior Secured Notes due 2013
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used hereof have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) Interest. Dynegy Holdings Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Note
at the rate of 10.125% per annum. The Company shall pay interest
semi-annually in arrears on January 15 and July 15 of each year, or if any
such day is not a Business Day, on the next succeeding Business Day (each,
an "Interest Payment Date"). Interest on the Notes shall accrue from the
most recent date to which interest has been paid or, if no interest has
been paid, from the date of issuance; provided that if there is no existing
Default in the payment of interest, and if this Note is authenticated
between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first
Interest Payment Date shall be January 15, 2004. The Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue principal and premium, if any, from time to time
on demand at a rate that is 1% per annum in excess of the rate then in
effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods) from time to time on
demand at the same rate to the extent lawful. Interest shall be computed on
the basis of a 360-day year of twelve 30-day months.
(2) Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of
Notes at the close of business on the January 1 or July 1 next preceding
the Interest Payment Date, even if such Notes are canceled after such
record date and on or before such Interest Payment Date, except as provided
in Section 2.12 of the Indenture with respect to defaulted interest. The
Notes shall be payable as to principal, premium, if any, and interest at
the office or agency of the Company maintained for such purpose within or
without the City and State of New York, or, at the option of the Company,
payment of interest may be made by check mailed to the Holders at their
addresses set forth in the register of Holders; provided that payment by
wire transfer of immediately available funds shall be required with respect
to principal of and interest, premium on, all Global Notes and all other
Notes the Holders of which shall have provided wire transfer instructions
reasonably in advance to the Company or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts.
(3) Paying Agent and Registrar. Initially, Wilmington Trust Company,
the Trustee under the Indenture, shall act as Paying Agent and Registrar.
The Company may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such
capacity.
(4) Indenture. The Company issued the Notes under an Indenture dated
as of August 11, 2003 (the "Indenture") among the Company, the Guarantors,
the Trustee and Xxxxx Fargo Bank Minnesota, N.A., as collateral trustee.
The terms of the Notes include those stated in the
A3-2
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling.
The Notes are secured obligations of the Company initially issued in $700
million in aggregate principal amount, and the Company may issue an
unlimited amount of additional Notes of this series under the Indenture,
subject to compliance with Section 4.09 of the Indenture. The Notes are
secured by the Indenture and the Security Documents.
(5) Guarantees. The Notes are guaranteed by Dynegy Inc., the parent
of the Company, certain other Affiliates of the Company and by all of the
Company's wholly-owned Domestic Subsidiaries that guarantee borrowings
under the Company's Credit Agreement as of August 11, 2003. The Note
Guarantees are the full and unconditional and joint and several general
obligations of the Guarantors. The Note Guarantees are secured, on a second
priority basis, by substantially all of the same assets that secure the
guarantees by the Guarantors of the Company's obligations under the Credit
Agreement.
(6) Optional Redemption.
At any time prior to July 15, 2006, the Company may on any one or more
occasions redeem up to 35% of the aggregate principal amount of the Series
C Notes issued hereunder at a redemption price of 110.125% of the principal
amount, plus accrued and unpaid interest to the redemption date, with a
contribution to the Company's common equity capital made with the net cash
proceeds of a concurrent sale of common stock of Dynegy; provided that:
(A) at least 65% of the aggregate principal amount of the Series
C Notes issued under the Indenture (excluding Notes held by the
Company or any of its Affiliates) remains outstanding immediately
after the occurrence of such redemption; and
(B) the redemption occurs within 75 days of the date of the
closing of such sale of common stock.
At any time prior to July 15, 2008, the Company may redeem all but not less
than all of the Series C Notes upon the occurrence of a Change of Control,
upon not less than 30 nor more than 60 days prior notice (but in any event
no earlier than the date of consummation of such Change of Control and no
later than 90 days after the occurrence of such Change of Control) at a
redemption price equal to the principal amount of the Series C Notes
redeemed plus the Applicable Premium for Series C Notes as of, and accrued
and unpaid interest, if any, to the date of redemption, subject to the
rights of Holders on the relevant record date to receive interest on the
relevant interest payment date. This optional redemption by the Company is
separate from and in addition to the rights of Holders as set forth in
Section 4.15 of the Indenture.
On or after July 15, 2008, the Company may redeem all or a part of the
Series C Notes upon not less than 30 nor more than 60 days notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest on the Series C Notes redeemed, to
the applicable redemption date, if redeemed during the twelve-month period
beginning on July 15 of the years indicated below, subject to the rights of
Holders on the relevant record date to receive interest on the relevant
interest payment date:
A3-3
Year Percentage
---- ----------
2008 ........................... 105.063%
2009 ........................... 103.375%
2010 ........................... 101.688%
2011 and thereafter............. 100.000%
Unless the Company defaults in the payment of the redemption price,
interest shall cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(7) Mandatory Redemption. The Company is not required to make
mandatory redemption or sinking fund payments with respect to the Notes.
(8) Repurchase At Option of Holder.
If there is a Change of Control, the Company shall be required to make
an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of each Holder's Notes at a
purchase price equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid thereon, if any, to the date of purchase subject to the
rights of Holders on the relevant record date to receive interest due on
the relevant interest payment date. Within 30 days following any Change of
Control, the Company shall mail a notice to each holder describing the
transaction or transactions that constitute the Change of Control and
offering to repurchase Notes on the Change of Control Payment Date
specified in the notice, which date shall be no earlier than 30 days and no
later than 60 days from the date such notice is mailed, pursuant to the
procedures required by the Indenture and described in such notice.
If Dynegy or any of its Restricted Subsidiaries consummate any Asset
Sales, when the aggregate amount of Excess Proceeds exceeds $50.0 million
or at such earlier time as the Company may elect, the Company shall make an
Asset Sale Offer to all Holders of Notes and all holders of other
Indebtedness that is pari passu with the Notes containing provisions
similar to those set forth in the Indenture with respect to offers to
purchase or redeem with the proceeds of sales of assets (an "Asset Sale
Offer") pursuant to Section 3.09 of the Indenture to purchase the maximum
principal amount of Notes (including any Additional Notes) and such other
pari passu Indebtedness that may be purchased out of the Excess Proceeds to
the extent required by the indentures governing other Indebtedness. The
offer price in any Asset Sale Offer shall be equal to 100% of principal
amount plus accrued and unpaid interest to the date of purchase, and shall
be payable in cash. If any Excess Proceeds remain after consummation of an
Asset Sale Offer, such Excess Proceeds shall be released from the Cash
Collateral Account and the Company may use those Excess Proceeds for any
purpose not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness tendered into
such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee
shall select the Notes and such other pari passu Indebtedness to be
purchased on a pro rata basis. Holders of Notes that are the subject of an
offer to purchase will receive an Asset Sale Offer from the Company prior
to any related purchase date and may elect to have such Notes purchased by
completing the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Notes.
(9) Notice of Redemption. Notice of redemption will be mailed by
first class mail at least 30 days but not more than 60 days before a
redemption date to each Holder whose Notes are to be redeemed at its
registered address, except that a redemption notice may be mailed more than
60 days prior to a redemption date if the notice is issued in connection
with a defeasance of the Notes or a satisfaction and discharge of the
Indenture. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes held by
a
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Holder are to be redeemed. On and after the redemption date interest ceases
to accrue on Notes or portions thereof called for redemption.
(10) Denominations, Transfer, Exchange. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Notes may be registered and Notes may be exchanged
as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture. The Company need
not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(11) Persons Deemed Owners. The registered Holder of a Note may be
treated as its owner for all purposes.
(12) Amendment, Supplement and Waiver. Subject to certain exceptions,
the Indenture, the Note Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Series C Notes voting as a single
class, and any existing default or compliance with any provision of the
Indenture, the Notes or the Note Guarantees may be waived with the consent
of the Holders of a majority in principal amount of the then outstanding
Series C Notes voting as a single class. Without the consent of any Holder
of a Note, the Indenture, the Notes or the Note Guarantees may be amended
or supplemented to cure any ambiguity, defect or inconsistency, to provide
for uncertificated Notes in addition to or in place of certificated Notes,
to provide for the assumption of the Company's or any Guarantor's
obligations to Holders of the Notes in case of a merger or consolidation,
to make any change that would provide any additional rights or benefits to
the Holders of the Notes or that does not adversely affect the legal rights
under the Indenture of any such Holder, to comply with the requirements of
the SEC in order to effect or maintain the qualification of the Indenture
under the Trust Indenture Act, to provide for the Issuance of Additional
Notes in accordance with the limitations set forth in the Indenture, or to
allow any Guarantor to execute a supplemental indenture to the Indenture
and/or a Note Guarantee with respect to the Notes, to make, complete or
confirm any grant of Collateral permitted or required by the Indenture or
any release of Collateral that becomes effective as set forth in the
Indenture, to reflect any waiver or termination of any right arising under
Article 11 of the Indenture that otherwise would be enforceable by any
holder of a Parity Lien Obligation or Parity Lien, if such waiver or
termination is set forth or provided in the Indenture or agreement
governing or giving rise to such Parity Lien Obligation or Parity Lien
(provided, that no such waiver or amendment pursuant to clause (9) of
Section 9.01 of the Indenture shall adversely affect the rights of the
Holders), or to conform the text of the Indenture, the Notes, the Note
Guarantees or the Security Documents to any provision that was contained in
the Offering Circular, dated as of August 1, 2003, that was used by the
Initial Purchasers in connection with the distribution of the Initial Notes
to the extent that such document contained a description of any provision
of the Indenture, the Notes, the Note Guarantees or the Security Documents
that was intended to be a verbatim recitation of such provision.
(13) Defaults and Remedies. Each of the following is an Event of
Default for the Series C Notes: (i) default for 30 days in the payment when
due of interest on any Series C Notes; (ii) default in payment when due of
the principal of, or premium, if any, on any Series C Notes; (iii) failure
by Dynegy or any of its Restricted Subsidiaries to comply with the
provisions
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described in Sections 4.07, 4.09, 4.10, 4.15 or 5.01 of the Indenture for
30 days after written notice from the Trustee or the holders of at least
25% in aggregate principal amount of the Series C Notes then outstanding to
comply with such provisions; (iv) failure by Dynegy or any of its
Restricted Subsidiaries for 60 days after written notice from the Trustee
or the holders of at least 25% in aggregate principal amount of the Series
C Notes then outstanding to comply with any of the other agreements in the
Indenture or the Security Documents; (v) default under any mortgage,
indenture or instrument under which there may be issued or by which there
may be secured or evidenced any Indebtedness for money borrowed by Dynegy
or any of its Restricted Subsidiaries (or the payment of which is
guaranteed by Dynegy or any of its Restricted Subsidiaries) whether such
Indebtedness or guarantee now exists, or is created after the date of the
Indenture, if that default: (x) is caused by a failure to pay principal of,
or interest or premium, if any, on such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of
such default (a "Payment Default") or (y) results in the acceleration of
such Indebtedness prior to its express maturity, and, in each case, the
principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness under which there has been a Payment
Default or the maturity of which has been so accelerated, aggregates $50.0
million or more; provided that, if such default shall be remedied or cured
by Dynegy or such Restricted Subsidiary or waived by the holder of such
Indebtedness, in each case before acceleration of the Notes, then the Event
of Default under the Indenture caused by reason thereof shall be deemed
likewise to have been remedied, cured or waived without further action on
the part of the Trustee, any holder of Notes or any other Person; (vi)
failure by Dynegy or any of its Restricted Subsidiaries to pay final and
non-appealable judgments aggregating in excess of $50.0 million, which are
not covered by indemnities or third party insurance, which judgments are
not paid, discharged, vacated or stayed for a period of 60 days; (vii)
breach by Dynegy or any of its Restricted Subsidiaries of any
representation or warranty or agreement in the Security Documents, the
repudiation by Dynegy or any of its Restricted Subsidiaries of any of its
obligations under the Security Documents or the unenforceability of the
Security Documents against Dynegy or any of its Restricted Subsidiaries for
any reason; (viii) except as permitted by the Indenture, the Guarantee of
the Notes by Dynegy, Illinova or any Significant Subsidiary of the Company
shall be held in any judicial proceeding to be unenforceable or invalid or
shall cease for any reason to be in full force and effect or Dynegy,
Illinova or any Subsidiary Guarantor that is a Significant Subsidiary of
the Company, or any Person acting on behalf of any such Guarantor, shall
deny or disaffirm its obligations under its Guarantee; and (ix) certain
events of bankruptcy or insolvency described in the indenture with respect
to Dynegy or any of its Restricted Subsidiaries that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken together,
would constitute a Significant Subsidiary. If any Event of Default occurs
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Series C Notes may declare all such Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event
of Default arising from certain events of bankruptcy or insolvency, all
outstanding Series C Notes will become due and payable without further
action or notice. Holders may not enforce the Indenture or the Series C
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Series C
Notes may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of the Series C Notes notice of any
continuing Default or Event of Default (except a Default or Event of
Default relating to the payment of principal or interest) if it determines
that withholding notice is in their interest. The Holders of a majority in
aggregate principal amount of the Series C Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Series C Notes
waive any existing Default or Event of Default and its consequences under
the Indenture except a continuing Default or Event of Default in the
payment of interest on, or the principal of, the Series C Notes. The
Company is required to deliver to the Trustee annually a statement
regarding compliance with the
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Indenture, and the Company is required upon becoming aware of any Default
or Event of Default, to deliver to the Trustee a statement specifying such
Default or Event of Default.
(14) Lien Subordination AND Sharing. The Notes, the Note Guarantees
and the other Note Obligations are secured by Note Liens upon the
Collateral pursuant to the Security Documents. The Note Liens are
subordinate in ranking to all current and future Priority Liens and of
equal ranking with all current and future Parity Liens as set forth in
Article 10 of the Indenture. The Notes, the Note Guarantees and the other
Note Obligations are secured by Note Liens upon the Collateral pursuant to
the Security Documents. The Note Liens are subordinate in ranking to all
current and future Priority Liens and of equal ranking with all current and
future Parity Liens as set forth in Article 11 of the Indenture.
(15) 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 the Trustee.
(16) No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, shall not have any liability for any obligations of the Company or
such Guarantor under the Notes, the Note Guarantees, the Indenture or the
Security Documents or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder by accepting a Note
waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of the Notes.
(17) Authentication. This Note shall not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
(18) Abbreviations. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
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).
(19) CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Notes or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.
The Company shall furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Attention: Dynegy Holdings Inc.
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Investor Relations
(000) 000-0000
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