1
DELTA NATURAL GAS COMPANY, INC.
and
THE FIFTH THIRD BANK,
TRUSTEE
-----------------------
INDENTURE
Dated as of March 1, 1998
-----------------------
$25,000,000
% Debentures
----
Due April 1, 2018
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TABLE OF CONTENTS
ARTICLE SECTION HEADING PAGE
------- ------- ------- ----
1 DEFINITIONS AND INCORPORATION
BY REFERENCE 1
1.01 Definitions 1
1.02 Other Definitions 5
1.03 Incorporation by Reference of
Trust Indenture Act 5
1.04 Rules of Construction 6
2 THE DEBENTURES 6
2.01 Form and Dating 6
2.02 Execution and Authentication 6
2.03 Registrar and Paying Agent 7
2.04 Paying Agent to Hold Money in
Trust 7
2.05 Debentureholder Lists 8
2.06 Transfer and Exchange 8
2.07 Replacement Debentures 9
2.08 Outstanding Debentures 9
2.09 Treasury Debentures 9
2.10 Temporary Debentures 10
2.11 Cancellation 10
2.12 Defaulted Interest 10
2.13 Persons Deemed Owners 10
3 REDEMPTION OF DEBENTURES AT
CORPORATION'S OPTION 11
3.01 Redemption Right at
Corporation's Option 11
3.02 Notices to Trustee 11
3.03 Selection of Debentures to be
Redeemed 11
3.04 Notice of Redemption 12
3.05 Effect of Notice of Redemption 12
3.06 Deposit of Redemption Price 12
3.07 Debentures Redeemed in Part 12
3.08 Corporation's Right to Withdraw
Redemption Election 13
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ARTICLE SECTION HEADING PAGE
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4 REDEMPTION OF DEBENTURES AT
DEBENTUREHOLDER'S OPTION 13
4.01 Redemption Right at Debenture-
holder's Option 13
5 COVENANTS 13
5.01 Payment of Debentures 13
5.02 Reporting 13
5.03 Corporate Existence 14
5.04 Payment of Taxes and Other
Claims 14
5.05 Limitation on Certain Funded
Indebtedness 14
5.06 Limitations on Dividends and
Other Payments on Stock 14
5.07 Limitation on Secured
Indebtedness 15
5.08 Compliance Certificate 16
5.09 Default Certificate 17
6 SUCCESSORS 17
6.01 When Corporation May Merge, etc. 17
7 DEFAULTS AND REMEDIES 17
7.01 Events of Default 17
7.02 Acceleration 19
7.03 Other Remedies 20
7.04 Waiver of Past Defaults 20
7.05 Control by Majority 20
7.06 Limitation on Suits 20
7.07 Rights of Holders to Receive
Payment 21
7.08 Collection Suit by Trustee 21
7.09 Trustee May File Proofs of
Claim 21
7.10 Priorities 22
7.11 Undertaking for Costs 22
7.12 Waiver of Stay or Extension
Laws 22
7.13 Restoration of Rights and
Remedies 23
7.14 Record Date for Vote of
Debentureholders 23
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ARTICLE SECTION HEADING PAGE
------- ------- ------- ----
8 TRUSTEE 23
8.01 Duties of Trustee 23
8.02 Rights of Trustee 24
8.03 Individual Rights of Trustee 25
8.04 Trustee's Disclaimer 25
8.05 Notice of Defaults 25
8.06 Reports by Trustee to Holders 25
8.07 Compensation and Indemnity 26
8.08 Replacement of Trustee 26
8.09 Successor Trustee by Merger, etc. 27
8.10 Eligibility; Disqualification 27
8.11 Preferential Collection of
Claims Against Corporation 28
8.12 Appointment of Xx-Xxxxxxx 00
0 DISCHARGE OF INDENTURE 29
9.01 Termination of Corporation's
Obligations 29
9.02 Application of Trust Money 30
9.03 Repayment to Corporation 30
10 AMENDMENTS, SUPPLEMENTS AND
WAIVERS 30
10.01 Without Consent of Holders 30
10.02 With Consent of Holders 31
10.03 Compliance with Trust Indenture
Act 31
10.04 Revocation and Effect of
Consents 31
10.05 Notation on or Exchange of
Debentures 31
10.06 Trustee Protected 32
11 MISCELLANEOUS 32
11.01 Trust Indenture Act Controls 32
11.02 Notices 32
11.03 Communication by Holders with
Other Holders 33
11.04 Certificate and Opinion as to
Conditions Precedent 33
11.05 Statements Required in Certifi-
cate or Opinion 33
11.06 Rules by Trustee and Agent 34
11.07 Legal Holidays 34
11.08 No Recourse Against Others 34
11.09 Duplicate Originals 34
11.10 Governing Law 34
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ARTICLE SECTION HEADING PAGE
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11.11 Table of Contents, Headings, etc. 34
SIGNATURES 35
EXHIBIT A -- FORM OF GLOBAL SECURITY A-1
EXHIBIT B -- FORM OF DEBENTURE B-1
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INDENTURE dated as of March 1, 1998, between DELTA NATURAL GAS COMPANY,
INC., a Kentucky corporation ("CORPORATION"), and THE FIFTH THIRD BANK, an
Ohio banking corporation ("TRUSTEE").
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Holders of the Corporation's %
----
Debentures Due April 1, 2018 ("Debentures"):
ARTICLE 1 - DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"AFFILIATE" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the
Corporation.
"AGENT" means any Registrar, Paying Agent or co-registrar or agent for
service of notices and demands. See Section 2.03 hereof.
"BOARD OF DIRECTORS" means the Board of Directors of the Corporation or
any authorized committee of the Board.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Corporate Secretary of the Corporation to have been duly adopted by the Board
of Directors and to be in full force and effect.
"CAPITAL STOCK" means any and all shares, interests, participations or
other equivalents (however designated) of corporate stock.
"COMMON STOCK" means the common stock, par value $1 per share, of the
Corporation as the same exists at the date of this Indenture or as such stock
shall be constituted from time to time.
"CONSOLIDATED", when used in connection with any accounting terms,
means the Corporation and its Subsidiaries, the financial statements of which
are consolidated in accordance with generally accepted accounting principles.
"CONSOLIDATED FUNDED INDEBTEDNESS" means the outstanding Funded
Indebtedness of the Corporation and its Consolidated Subsidiaries (excluding
in all cases Funded Indebtedness owing to the Corporation or Consolidated
Subsidiaries); provided, however, that if the Corporation owns, directly or
indirectly, less than all of the voting stock of a Consolidated Subsidiary,
only that portion of the Funded Indebtedness of such Consolidated Subsidiary
equal to the proportion of its outstanding voting stock owned by the
Corporation shall be included in determining Consolidated Funded
Indebtedness.
"CONSOLIDATED NET UTILITY FIXED ASSETS" means the aggregate value of
Utility Fixed Assets of the Corporation and its Consolidated Subsidiaries
less accumulated depreciation, determined on a consolidated basis in
accordance with generally accepted accounting principles applied in a manner
consistent with the most recent audited financial statements included in
reports delivered to the Trustee pursuant to Section 5.02 hereof; provided,
however, that if the Corporation owns, directly or indirectly, less than all
of the outstanding voting stock of a Consolidated Subsidiary, only that
portion of the Utility Fixed Assets of such Consolidated Subsidiary equal to
the proportion of its outstanding voting stock owned by the Corporation shall
be included in determining Consolidated Net Utility Fixed Assets.
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"CONSOLIDATED TANGIBLE NET WORTH" means an amount equal to the
stockholders' ownership of the Corporation and its Consolidated Subsidiaries
(including capital stock, capital in excess of par value and retained
earnings, but eliminating any unpaid amounts due for sale of stock) less
intangible assets, all determined on a consolidated basis in accordance with
generally accepted accounting principles applied in a manner consistent with
the most recent audited financial statements included in reports delivered to
the Trustee pursuant to Section 5.02 hereof.
"CORPORATE TRUST OFFICE" means the office of the Trustee located in
Cincinnati, Ohio, at which at any time its corporate trust business shall be
principally administered, which office at the date of execution of this
Indenture is located at 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxx 00000,
Attention: Corporate Trust Administration.
"CORPORATION" means the party named as such above until a successor
replaces it pursuant to the applicable provisions of the Indenture and
thereafter means the successor.
"CURRENT INDEBTEDNESS" of a Person means, as of the date of
determination thereof, all Indebtedness maturing on demand or not more than
one year after the date as of which such determination is made (excluding any
Indebtedness renewable or extendible at the option of the debtor, absolutely
or conditionally, for a period or periods ending more than one year after the
date of such determination, whether or not theretofore extended or renewed),
fixed sinking fund payments (except to the extent that funds for the payment
thereof shall have been deposited with a trustee for the application thereof)
and other prepayments required to be made with respect to any Indebtedness
not more than one year after such date, and all other items (including taxes
accrued as estimated) which in accordance with generally accepted accounting
principles would be included as current indebtedness.
"DEBENTURE" means the Debentures described above as issued under this
Indenture.
"DEFAULT" means any event which is, or after notice or passage of time
would be, an Event of Default.
"DEPOSITORY" means The Depository Trust Company in the City of New York
and any successor to such Person.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as from time
to time amended.
"FUNDED INDEBTEDNESS" means all Indebtedness other than Current
Indebtedness.
"GLOBAL SECURITY" means a security evidencing all of the Debentures
issued to the Depository or its nominee and registered in the name of the
Depository or its nominee.
"HOLDER" OR "DEBENTUREHOLDER" means a person in whose name a Debenture
is registered; provided, however, that for purposes of Sections 7.06 and 7.07
hereof, such terms shall also include the Beneficial Owner (as defined in the
Debentures) of any Debenture.
"INDEBTEDNESS" of a Person means (i) all items of indebtedness or
liability which in accordance with generally accepted accounting principles
would be included in determining total liabilities as shown on the liability
side of a balance sheet as at the date as of which indebtedness is to be
determined, (ii) indebtedness upon which the Person whose indebtedness is
being determined customarily pays interest charges and indebtedness secured
by any mortgage, pledge or lien existing on property owned by such Person,
whether or not the indebtedness secured thereby shall have been assumed but,
if (a) any such indebtedness shall not have been assumed or guaranteed by
such Person, (b) such Person customarily does not pay any interest thereon,
and (c) such mortgage, pledge or lien was created by others upon lands over
which such Person has an
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easement or right of way, such indebtedness shall not be deemed to be
Indebtedness of such Person except to the extent of the larger of the fair value
or cost to such Person of such property (including any improvements thereon)
covered by such mortgage, pledge or lien, and (iii) guaranties, endorsements
(other than for purposes of collection in the ordinary course of business) and
other contingent obligations in respect of, or in respect to the purchase
or other acquisition of, indebtedness of others.
"INDENTURE" means this Indenture as amended from time to time.
"INTEREST PAYMENT DATE" means April 1 and October 1 of each year
commencing October 1, 1998 through and including April 1, 2018.
"LIEN" means any lien, mortgage, pledge, security interest, charge or
other encumbrance of any kind.
"OFFICER" means the principal executive officer, principal financial
officer, principal accounting officer or President of the Corporation.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers of
the Corporation. See Sections 11.04 and 11.05 hereof.
"OPINION OF COUNSEL" means a written opinion from legal counsel who may
be an employee of or counsel to the Corporation or the Trustee and who is
reasonably acceptable to the Trustee. See Sections 11.04 and 11.05 hereof.
"PERSON" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"PRINCIPAL" of the Debenture means the principal of the Debenture plus
the Premium, if any, on the Debenture.
"QUALIFIED INSTITUTION" means a member firm of a registered national
securities exchange or of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company located in the United States.
"RECORD DATE" means March 15 and September 15.
"REDEMPTION DATE" when used with respect to any Debenture to be
redeemed means the date fixed for such redemption pursuant to this Indenture.
"REDEMPTION PRICE" when used with respect to any Debenture to be
redeemed means the price at which it is to be redeemed pursuant to this
Indenture and the Debenture.
"SEC" means the Securities and Exchange Commission.
"SPECIAL RECORD DATE" means the date set by the Corporation for
determination of Debentureholders of record for purposes of paying any
defaulted interest.
"SUBSIDIARY" means a corporation at least the majority of whose voting
stock is owned by the Corporation or a Subsidiary.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date shown above except as provided
in Section 10.03 hereof.
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"TRUSTEE" means the party named as such above until a successor
replaces it pursuant to the applicable provisions of this Indenture and
thereafter means this successor.
"TRUST OFFICER" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"UNITED STATES" means the United States of America.
"U.S. GOVERNMENT OBLIGATIONS" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a person controlled or
supervised by and acting as an agency or instrumentality of the United States
of America the payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America, which, in either case,
are not callable or redeemable at the option of the issuer thereof.
"UTILITY FIXED ASSETS" means all physical property owned by the
Corporation and any Consolidated Subsidiaries and used or useful to the
Corporation in the business of furnishing or distributing, as a public
utility, gas service, the cost of which is charged and properly chargeable to
plant or plant addition account on the books of the Corporation or such
Consolidated Subsidiary in accordance with sound accounting practices and
generally accepted accounting principles. Utility Fixed Assets need not
consist of a specific or complete accession, addition or improvement or
complete new property, but may include construction work in progress or any
work such as is carried in fixed property accounts in accordance with sound
accounting practices and generally accepted accounting principles, whether
capable of complete description and identification or not.
SECTION 1.02. OTHER DEFINITIONS.
TERM DEFINED IN SECTION
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"BANKRUPTCY LAW" 7.01
"CUSTODIAN" 7.01
"EVENT OF DEFAULT" 7.01
"LEGAL HOLIDAY" 11.07
"PAYING AGENT" 2.03
"REGISTRAR" 2.03
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 Debentures.
"INDENTURE SECURITY HOLDER" means a Debentureholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the
Trustee.
"OBLIGOR" on the indenture securities means the Corporation.
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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 assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted
accounting principles;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) "Section" shall refer to a Section of this Indenture.
ARTICLE 2 - THE DEBENTURES
SECTION 2.01. FORM AND DATING.
The form of the Debentures to be originally issued as a Global Security
shall be substantially in the form of Exhibit A, which is part of this
Indenture. The form of the Debentures to be issued in exchange for a Global
Security shall be substantially in the form of Exhibit B, which is part of
this Indenture. The terms of such Exhibits A and B are hereby incorporated
herein by reference. The Debentures may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Debenture
shall be dated the date of its authentication.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Debentures for the Corporation by manual or
facsimile signature. The Corporation's seal shall be reproduced on the
Debentures.
If an Officer whose signature is on a Debenture no longer holds that
Office at the time the Debenture is authenticated, the Debenture shall
nevertheless be valid.
A Debenture shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that
the Debenture has been authenticated under this Indenture.
The Trustee shall authenticate Debentures for original issue up to the
aggregate principal amount of $25,000,000 upon a written order of the
Corporation signed by one officer. The aggregate principal amount of
Debentures outstanding at any time may not exceed that amount except as
provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Corporation to authenticate Debentures. An authenticating agent may
authenticate Debentures 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 the Corporation or an Affiliate.
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SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Corporation shall maintain an office or agency where Debentures may
be presented for registration or transfer or for exchange ("REGISTRAR"), an
office or agency where Debentures may be presented for payment ("PAYING
AGENT") and an office or agency where notices and demands to or upon the
Corporation in respect of the Debentures and this Indenture may be served.
The Registrar shall keep a register of the Debentures and of their transfer
and exchange. The Corporation may appoint one or more co-registrars and one
or more additional paying agents. The Corporation or any Subsidiary may act
as Registrar or Paying Agent. The term "Paying Agent" includes any
additional paying agent.
The Corporation shall notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. If the Corporation fails
to maintain a Registrar, Paying Agent or agent for service of notices and
demands or fails to give the foregoing notice, the Trustee shall act as such.
The Corporation initially appoints The Fifth Third Bank as Registrar,
Paying Agent and agent for service of notices and demands.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Corporation shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent will hold in trust for the benefit
of Debentureholders or the Trustee all money held by the Paying Agent for the
payment of Principal or interest on the Debentures, and will notify the
Trustee of any Default by the Corporation in making any such payment. While
any such Default continues, the Trustee may require a Paying Agent to pay all
money held by it to the Trustee. The Corporation at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over
to the Trustee, the Paying Agent shall have no further liability for the
money. If the Corporation (or any Subsidiary) acts as Paying Agent, it shall
segregate and hold as a separate trust fund all money held by it as Paying
Agent.
SECTION 2.05. DEBENTUREHOLDER 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 Debentureholders. If the Trustee is not the Registrar, the Corporation
shall furnish to the Trustee on or before each Interest Payment Date and at
such other times as the Trustee may request in writing a list of the names
and addresses of Debentureholders in such form and as of such date as the
Trustee may reasonably require.
SECTION 2.06. TRANSFER AND EXCHANGE.
When Debentures are presented to the Registrar or a co-registrar with a
request to register the transfer or to exchange them for an equal principal
amount of Debentures of other denominations, the Registrar shall register the
transfer or make the exchange, provided that every Debenture presented or
surrendered for registration of transfer or exchange shall be duly endorsed
or be accompanied by a written instrument of transfer in form satisfactory to
the Registrar duly executed by the Holder thereof or by his attorney duly
authorized in writing. To permit registrations of transfer and exchanges,
the Trustee shall authenticate Debentures at the Registrar's written request
(which written request may be waived by the Trustee so long as the Trustee
and Registrar are one and the same). No service charge shall be made for any
registration of transfer or exchange of Debentures to the Debentureholders,
but the Corporation may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation thereto, other
than exchanges pursuant to Section 2.10 or 3.07 hereof.
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A Global Security shall be exchangeable pursuant to this Section for
Debentures registered in the names of Persons other than the Depository or
its nominee only as provided in this paragraph. A Global Security shall be
exchangeable pursuant to this Section if (i) such Depository notifies the
Corporation that it is unwilling or unable to continue as Depository for such
Debentures or at any time ceases to be a clearing agency registered as such
under the Exchange Act, (ii) the Corporation executes and delivers to the
Trustee an Officers' Certificate providing that such Global Security shall be
so exchangeable, or (iii) there shall have occurred and be continuing an
Event of Default. Debentures so issued in exchange for a Global Security
shall be of like tenor, in authorized denominations of $1,000 or integral
multiples thereof and in the aggregate having the same principal amount as
the Global Security to be exchanged, and shall be registered in such names as
the Depository shall direct.
Notwithstanding any other provision of this Section, a Global Security
may not be transferred except as a whole by the Depository to a nominee of
such Depository or by a nominee of such Depository to such Depository or
another nominee of such Depository.
SECTION 2.07. REPLACEMENT DEBENTURES.
If the Holder of a Debenture claims that the Debenture has been lost,
destroyed or wrongfully taken, the Corporation shall issue and the Trustee
shall authenticate a replacement Debenture if the Trustee's requirements are
met. If required by the Trustee or the Corporation, an indemnity bond must
be obtained and be sufficient in the judgment of both to protect the
Corporation, the Trustee, any Agent or any authenticating agent from any loss
which any of them may suffer if a Debenture is replaced. The Corporation and
the Trustee may charge for their expenses in replacing a Debenture.
Every replacement Debenture is an additional obligation of the
Corporation.
SECTION 2.08. OUTSTANDING DEBENTURES.
The Debentures outstanding at any time are all the Debentures
authenticated by the Trustee except for those canceled by it, those delivered
to it for cancellation, and those described in this Section as not
outstanding.
If a Debenture is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that
the replaced Debenture is held by a bona fide purchaser.
If Debentures are considered paid under Section 5.01 hereof, they
cease to be outstanding and interest on them ceases to accrue.
Except with the limitations set forth in Section 2.09 hereof, a
Debenture does not cease to be outstanding because the Corporation or an
Affiliate holds the Debenture.
SECTION 2.09. TREASURY DEBENTURES.
In determining whether the Holders of the required principal amount of
Debentures have concurred in any direction, waiver or consent, Debentures
owned by the Corporation or an Affiliate shall be disregarded, except for
purposes of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent. Only Debentures which the Trustee
knows are so owned shall be disregarded.
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SECTION 2.10. TEMPORARY DEBENTURES.
Until definitive Debentures are ready for delivery, the Corporation may
prepare and the Trustee shall authenticate temporary Debentures. Temporary
Debentures shall be substantially in the form of definitive Debentures but
may have variations that the Corporation considers appropriate for temporary
Debentures. Without unreasonable delay, the Corporation shall cause to be
issued and the Trustee shall authenticate definitive Debentures in exchange
for temporary Debentures.
SECTION 2.11. CANCELLATION.
The Corporation at any time may deliver Debentures to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Debentures surrendered to them for registration of transfer,
exchange or payment. The Trustee shall cancel all Debentures surrendered for
registration of transfer, exchange or payment and shall dispose of canceled
Debentures as the Corporation directs. The Corporation may not issue new
Debentures to replace Debentures that it has paid for or delivered to the
Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Corporation defaults in a payment of interest on the Debentures,
it shall pay the defaulted interest in any lawful manner. It may pay the
defaulted interest, plus any interest payable on the defaulted interest, to
the Persons who are Debentureholders on a subsequent Special Record Date.
The Corporation shall fix the Special Record Date and payment date in a
manner satisfactory to the Trustee. At least 15 days before the Special
Record Date, the Corporation shall mail to Debentureholders a notice that
states the Special Record Date, the payment date and the amount of interest
to be paid.
SECTION 2.13. PERSONS DEEMED OWNERS.
Prior to due presentment of a Debenture for registration of transfer,
the Corporation, the Trustee and any Agent of the Corporation or the Trustee
may treat the Person in whose name such Debenture is registered as the owner
of such Debenture for the purpose of receiving payment of Principal of (and
premium, if any) and (subject to Section 2.12 hereof) interest, if any, on
such Debenture and for all other purposes whatsoever, whether or not such
Debenture be overdue, and neither the Corporation, the Trustee nor any Agent
of the Corporation or the Trustee shall be affected by notice to the
contrary. All such payments so made to any such Person, or upon such
Person's order, shall be valid, and, to the extent of the sums so paid,
effectual to satisfy and discharge the liability for moneys payable upon any
such Debenture.
Except to the extent provided in Sections 7.06 and 7.07 hereof, no
holder of any beneficial interest in any Global Security held on its behalf
by a Depository shall have any rights under this Indenture with respect to
such Global Security, and such Depository may be treated by the Corporation,
the Trustee, and any Agent of the Corporation or the Trustee as the owner of
such Global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall impair, as between a Depository and such
holders of beneficial interests, the operation of customary practices
governing the exercise of the rights of the Depository as Holder of any
Debenture.
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ARTICLE 3 - REDEMPTION OF DEBENTURES AT
CORPORATION'S OPTION
SECTION 3.01. REDEMPTION RIGHT AT CORPORATION'S OPTION.
The Corporation has the right to redeem the Debentures at its sole
option, in whole or in part, at any time and from time to time on or after
April 1, 2003, at the Redemption Prices specified in paragraph 5 of the
Debenture, subject to the terms and conditions set forth in this Article 3.
The election of the Corporation to redeem any Debenture shall be evidenced by
a Board Resolution.
SECTION 3.02. NOTICES TO TRUSTEE.
If the Corporation wishes to redeem Debentures pursuant to paragraph 5
of the Debenture, it shall notify the Trustee in writing of the Redemption
Date and the principal amount of Debentures to be redeemed. The Corporation
shall give the notice provided for in this Section not less than 60 days
prior to the Redemption Date or such shorter time as may be satisfactory to
the Trustee.
SECTION 3.03. SELECTION OF DEBENTURES TO BE REDEEMED.
If less than all the Debentures are to be redeemed, the Trustee shall
select the Debentures to be redeemed by lot. The Trustee shall, not less
than 45 days before the Redemption Date or such shorter time as may be
mutually satisfactory to the Trustee and the Corporation, inform the
Corporation in writing of those specific Debentures selected for redemption.
The Trustee may select for redemption portions of the principal of Debentures
that have denominations larger than $1,000. Debentures and portions of
Debentures that the Trustee selects shall be in amounts of $1,000 or integral
multiples of $1,000. Provisions of this Indenture that apply to Debentures
called for redemption also apply to portions of Debentures called for
redemption.
SECTION 3.04. NOTICE OF REDEMPTION.
At least 30 days before a Redemption Date, the Corporation shall mail
notice of redemption to each Holder whose Debentures are to be redeemed. A
copy of each such notice shall be mailed to the Trustee.
The notice shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that Debentures called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(5) that interest on Debentures called for redemption ceases to
accrue on and after the Redemption Date (unless the Corporation
shall default in the payment of the Redemption Price); and
(6) if less than all of the Debentures outstanding are to be
redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the Debentures
to be redeemed.
At the Corporation's written request, the Trustee shall give notice of
redemption in the Corporation's name and at the expense of the Corporation.
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SECTION 3.05. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed as provided in Section 3.04 hereof,
Debentures called for redemption become due and payable on the Redemption
Date at the Redemption Price, subject, however to the provisions of Section
3.08 hereof.
SECTION 3.06. DEPOSIT OF REDEMPTION PRICE.
On or before the Redemption Date, the Corporation shall deposit with
the Paying Agent cash sufficient to pay the Redemption Price and accrued
interest on all Debentures to be redeemed.
SECTION 3.07. DEBENTURES REDEEMED IN PART.
Upon surrender of a Debenture that is redeemed in part, the Trustee
shall authenticate for the Holder a new Debenture equal in principal amount
to the unredeemed portion of the Debenture surrendered.
SECTION 3.08. CORPORATION'S RIGHT TO WITHDRAW REDEMPTION
ELECTION.
Notwithstanding any other provision of this Article 3, the Corporation
shall have the right, at its option, to withdraw, in whole or in part, its
election and notice of redemption pursuant to this Article 3 by written
notice of such withdrawal given by the Corporation to the Trustee and to each
Holder affected thereby at least five (5) days prior to the Redemption Date.
At the Corporation's request, the Trustee shall give such notice of
withdrawal to such Holders in the Corporation's name and at the expense of
the Corporation. Upon the giving of such notice of withdrawal, the
Corporation's redemption election and all notices given pursuant thereto
shall be deemed rescinded to the extent set forth in such notice of
withdrawal and all parties affected thereby shall be restored to their
respective former positions hereunder as if no redemption election had been
made by the Corporation and no such redemption notices had been given.
ARTICLE 4 - REDEMPTION OF DEBENTURES AT
DEBENTUREHOLDER'S OPTION
SECTION 4.01. REDEMPTION RIGHT AT DEBENTUREHOLDER'S OPTION.
Representatives of deceased Debentureholders and, in the case of a
Global Security, representatives of deceased beneficial owners of such Global
Security, have certain optional redemption rights all as set forth in the
forms of Debenture attached hereto as Exhibits A and B.
ARTICLE 5 - COVENANTS
SECTION 5.01. PAYMENT OF DEBENTURES.
The Corporation shall pay the Principal of and interest on the
Debentures on the dates and in the manner provided in the Debentures.
Principal and interest shall be considered paid on the date due if the
Trustee or any Paying Agent holds on that date money sufficient to pay all
Principal and interest then due, provided that, if Debentures are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made.
The Corporation shall pay interest on overdue Principal at the rate
borne by the Debentures; it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
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SECTION 5.02. REPORTING.
The Corporation shall file with the Trustee within 15 days after it
files them with the SEC copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the
foregoing as the SEC may by rules and regulations prescribe) which the
Corporation is required to file with the SEC pursuant to Section 13 or 15(d)
of the Exchange Act. The Corporation also shall comply with the other
provisions of TIA Sec. 314(a).
SECTION 5.03. CORPORATE EXISTENCE.
Subject to Article 6 hereof, the Corporation will do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the rights (articles and statutory) of the
Corporation; provided, however, that the Corporation shall not be
-------- -------
required to preserve any such right if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Corporation taken as a whole and that the loss thereof is
not, and will not be, adverse in any material respect to the Holders.
SECTION 5.04. PAYMENT OF TAXES AND OTHER CLAIMS.
The Corporation will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges levied or imposed upon it or any
Subsidiary or upon the income, profits or property of the Corporation or any
Subsidiary and (ii) all material lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon the property of
the Corporation or any of its Subsidiaries; provided, however, that the
Corporation shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 5.05. LIMITATION ON CERTAIN FUNDED INDEBTEDNESS.
Neither the Corporation nor a Subsidiary will create, issue, incur,
guarantee or assume any Funded Indebtedness which ranks prior to or on a
parity with the Debentures in right of payment unless immediately thereafter,
and after giving effect thereto and to the application of the proceeds
thereof, Consolidated Net Utility Fixed Assets shall be at least equal to
Consolidated Funded Indebtedness.
SECTION 5.06. LIMITATIONS ON DIVIDENDS AND OTHER
PAYMENTS ON STOCK.
The Corporation will not declare or pay any dividends or make any
distributions upon any Common Stock of the Corporation (other than dividends
and distributions payable only in shares of Common Stock of the Corporation)
and will not directly or indirectly apply any of the assets of the
Corporation to the redemption, retirement, purchase or other acquisition of
any stock of the Corporation of any class, except purchases or redemptions in
compliance with any mandatory sinking fund or purchase fund or redemption
requirement in respect of any preferred stock of the Corporation, whether now
or hereafter authorized or issued, unless after giving effect to such
declaration, payment, distribution or application of assets the Consolidated
Tangible Net Worth of the Corporation shall be at least equal to $21,500,000
as reflected on the Corporation's latest available balance sheet, which in no
event shall be as of a date more than three months prior to the date of
declaration of a dividend or application of assets.
SECTION 5.07. LIMITATION ON SECURED INDEBTEDNESS.
Neither the Corporation nor a Subsidiary will issue, assume or
guarantee any Indebtedness secured by a Lien on any property or asset at any
time owned by it, without effectively securing, prior to or concurrently with
the issuance, assumption or guarantee of any such Indebtedness, the
Debentures equally and ratably with (or, at the Corporation's option, in a
prior position to) such
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Indebtedness. The foregoing described restriction does not apply to or prevent
the creation of:
(i) existing Liens on property or Indebtedness of a corporation
which is merged with or into or consolidated with the
Corporation or a Subsidiary provided that the Liens do not
apply to any property theretofore owned by the Corporation;
(ii) any Lien existing on the effective date of this Indenture, and,
if the Corporation purchases in fee real property and acquires
or constructs improvements thereon to be used by the
Corporation as office space, a Lien on such real property and
improvements to secure Indebtedness incurred for the purchase
of such real property and improvements, so long as such Lien is
limited to such real property and improvements and such
Indebtedness does not exceed 75% of the purchase price thereof;
(iii) Liens on moneys or U.S. Government Obligations deposited with
the Trustee pursuant to this provisions of this Indenture
summarized under Article 9 hereof:
(iv) Liens (which term for purposes of this Subsection 5.07 (iv)
shall include conditional sale agreements or other title
retention agreements and leases in the nature of title
retention agreements) upon motor vehicles or office equipment
acquired by the Corporation or a Subsidiary after the effective
date of this Indenture, under credit terms customarily extended
to purchasers by the manufacturers or other sellers, provided
that no such Lien shall extend to or cover any property of the
Corporation or any Subsidiary, as the case may be, other than
the property then being acquired;
(v) Liens for the sole purpose of extending, renewing or replacing,
in whole or in part, Liens securing Indebtedness of the type
referred to in the foregoing Subsections 5.07 (i) through (iv)
above, provided, however, that the principal amount of the
Indebtedness so secured at the time of such extension, renewal
or replacement shall not be increased and that such extension,
renewal or replacement shall be limited to all or part of the
property or Indebtedness which secured the Lien so extended,
renewed or replaced (plus improvements on such property);
(vi) Liens for taxes or assessments or other governmental charges or
levies not yet due and payable;
(vii) Materialmen's, mechanics', workmen's, repairmen's or other like
Liens arising in the ordinary course of business so long as the
obligations giving rise to such Liens are satisfied in a timely
manner;
(viii) Liens created by or existing from any litigation or legal
proceeding which is currently being contested in good faith by
appropriate proceedings, and as to which execution is
effectively stayed; or
(ix) Liens to secure Indebtedness having an outstanding principal
balance aggregating not more than $4,000,000 exclusive of
Indebtedness described in the foregoing Subsections 5.07 (i)
through (viii) above.
The Corporation further covenants that it will not incur any such Lien
unless the instruments and collateral documents equally and ratably securing
the Debentures are approved by the Trustee, and in the opinion of independent
counsel selected by the Trustee, the transaction creating such Lien complies
with the requirements of this Section.
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SECTION 5.08. COMPLIANCE CERTIFICATE.
The Corporation shall deliver to the Trustee within 120 days after the
end of each fiscal year of the Corporation an Officers' Certificate as to the
Corporation's compliance with all conditions and covenants under the
Indenture, and further stating whether or not the signers know of any Default
that occurred during the fiscal year. If the signers know of any such
Default, the Officers' Certificate shall describe the Default and its status,
and the Corporation's compliance shall be determined without regard to any
grace period or notice requirements under this Indenture. The certificate
need not comply with Section 11.05 hereof.
SECTION 5.09. DEFAULT CERTIFICATE.
The Corporation shall deliver to the Trustee, within seven (7) days of
obtaining knowledge of the existence of a Default hereunder, or within seven
(7) days of any event of default as described in Section 7.01(4) hereof, a
certificate signed by one of its Officers, setting forth the nature of the
Default and the steps taken, if any, to cure such Default.
ARTICLE 6 - SUCCESSORS
SECTION 6.01. WHEN CORPORATION MAY MERGE, ETC.
The Corporation shall not consolidate or merge into, or transfer or
lease all or substantially all of its assets to, any Person unless:
(1) the Person is a corporation organized and existing under the Laws
of the United States, or any State thereof or the District of
Columbia;
(2) the Person assumes by supplemental indenture all the obligations
of the Corporation under the Debentures and this Indenture;
(3) immediately after the transaction no Default exists; and
(4) the Corporation has delivered to the Trustee an Officers'
Certificate and Opinion of Counsel each stating that the
transaction and supplemental indenture comply with this Article.
The surviving transferee or lessee corporation shall be the successor
Corporation and deemed to and be substituted for the Corporation under this
Indenture, and the predecessor Corporation in the case of a transfer or lease
shall be released from all obligations and covenants under this Indenture and
the Debentures.
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ARTICLE 7 - DEFAULTS AND REMEDIES
SECTION 7.01. EVENTS OF DEFAULT.
An "EVENT OF DEFAULT" occurs if:
(1) the Corporation defaults in the payment of interest on any
Debenture when the same becomes due and payable and the Default
continues for a period of 30 days;
(2) the Corporation defaults in the payment of the Principal of any
Debenture when the same becomes due and payable at maturity, upon
redemption or otherwise;
(3) the Corporation fails to comply with any of its other agreements
in the Debentures or this Indenture and the Default continues for
the period and after the notice specified below;
(4) an event of default as defined in 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 for
which the Corporation or any Consolidated Subsidiary is
responsible or liable as obligor, guarantor or otherwise or
obligations of the Corporation or any Consolidated Subsidiary as a
lessee under leases required to be capitalized under generally
accepted accounting principles, in an aggregate principal amount
of $100,000 or more, whether such Indebtedness or obligation now
exists or shall hereafter be created, shall happen and shall
result in such Indebtedness or obligation becoming or being
declared due and payable prior to the date on which it would
otherwise become due and payable, and such acceleration shall not
be rescinded or annulled, or such Indebtedness or obligation shall
not have been discharged, within a period of 10 days after written
notice has been given to the Corporation by the Trustee or to the
Corporation and the Trustee by the Holders of at least 25% in
principal amount of the Debentures then outstanding, specifying
such event of default and requiring the Corporation to cause such
acceleration to be rescinded or annulled or to cause such
Indebtedness or obligation to be discharged and stating that such
notice is a "Notice of Default" hereunder;
(5) the Corporation pursuant to or within the meaning of any
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, or
(D) makes a general assignment for the benefit of its creditors;
or
(6) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law, and the order or decree remains unstayed and
in effect for 60 days, that:
(A) is for relief against the Corporation in an
involuntary case,
(B) appoints a Custodian of the Corporation for all or
substantially all of its property, or
(C) orders the liquidation of the Corporation.
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The term "BANKRUPTCY LAW" means title 11, U.S. Code or any similar
Federal or State law for the relief of debtors. The term "CUSTODIAN" means
any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under Section 7.01(3) above is not an Event of Default until
(i) the Trustee or the Holders of at least 25% in principal amount of the
Debentures then outstanding notify the Corporation of the Default, or (ii)
the Corporation provides notice to the Trustee pursuant to the provisions of
Section 5.08 hereof, and the Corporation does not cure the Default within 60
days after receipt of such respective notice. The notice must specify the
Default, demand that it be remedied and state that the notice is a "Notice of
Default." The Trustee shall, if requested to do so by the Holders of 25% in
principal amount of the Debentures, notify the Corporation of the Default
pursuant to this Section.
Subject to the provisions of Sections 8.01 and 8.02 hereof, the Trustee
shall not be charged with knowledge of any Event of Default unless written
notice thereof shall have been given to a Trust Officer of the Trustee at the
Corporate Trust Office by the Corporation, the Paying Agent, the Holder of a
Debenture or an agent of such Holder or, in the case of an Event of Default
under Section 7.01(4) above, by the trustee acting under any mortgage,
indenture or other instrument under which the event of default shall have
occurred or by the holder or the agent of any holder of such Indebtedness.
SECTION 7.02. ACCELERATION.
If an Event of Default occurs and is continuing, the Trustee, by notice
to the Corporation, or the Holders of at least 25% in principal amount of the
Debentures then outstanding, by notice to the Corporation and the Trustee,
may declare the Principal of, and accrued interest on, all the Debentures to
be due and payable. Upon such declaration the Principal and interest shall
be due and payable immediately.
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The Holders of a majority in principal amount of the Debentures then
outstanding, by notice to the Trustee, may rescind an acceleration of all the
Debentures and its consequences if (i) all existing Events of Default have
been cured or waived except nonpayment of the principal and interest that has
become due solely because of the acceleration and (ii) if the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction. No such rescission shall affect any subsequent default or
impair any right consequent thereon.
SECTION 7.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of Principal or interest on the
Debentures or to enforce the performance of any provision of the Debentures
or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Debentures or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Debentureholder 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 such Event of Default. All
remedies are cumulative to the extent permitted by law.
SECTION 7.04. WAIVER OF PAST DEFAULTS.
The Holders of a majority in principal amount of the Debentures, by
notice to the Trustee, on behalf of all Debentureholders, may waive a past
Default and its consequences, except a Default in the payment of the
Principal of or interest on any Debenture, an uncured failure to make any
redemption payment or an uncured Default with respect to a provision which
cannot be modified under the terms of this Indenture without the consent of
each Holder affected.
SECTION 7.05. CONTROL BY MAJORITY.
The Holders of a majority in principal amount of the Debentures then
outstanding may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, is unduly prejudicial to
the rights of other Debentureholders, or would involve the Trustee in
personal liability; provided, that the Trustee may take any other action
--------
deemed proper by the Trustee which is not inconsistent with such direction.
However, the Trustee is under no duty or obligation to exercise its
discretion in determining whether such directions may conflict with law or
this Indenture, or are unduly prejudicial to the rights of Debentureholders.
SECTION 7.06. LIMITATION ON SUITS.
A Debentureholder may pursue a remedy with respect to this Indenture or
the Debentures only if:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in principal amount of the Debentures
then outstanding make a written request to the Trustee to pursue
the remedy;
(3) such Holder or Holders offer to the Trustee indemnity satisfactory
to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request by Debentureholders
pursuant to Section 7.06(2) above, within 60 days after receipt of
the request and the offer of indemnity; and
22
(5) during such 60-day period the Holders of a majority in principal
amount of the Debentures then outstanding do not give the Trustee
a direction inconsistent with the request.
A Debentureholder may not use this Indenture to prejudice the rights of
another Debentureholder or to obtain a preference or priority over another
Debentureholder.
SECTION 7.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Debenture to receive payment of Principal and interest on the
Debenture, on or after the respective due dates expressed in the Debenture,
or to bring suit for the enforcement of any such payment on or after such
respective dates, is absolute and unconditional and shall not be impaired or
affected without the consent of the Holder.
SECTION 7.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default in payment of interest or Principal specified in
Section 7.01(1) or (2) hereof occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against
the Corporation for the whole amount of unpaid Principal and accrued interest
remaining unpaid.
SECTION 7.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may 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 Debentureholders
allowed in any judicial proceedings relative to the Corporation upon the
Debentures, its creditors or its property, and shall be entitled and
empowered to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same, and any Custodian
in any such judicial proceeding is hereby authorized by each Debentureholder
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 Debentureholders, to
pay to the Trustee any amount due to it for the reasonable compensation,
expenses and disbursements and advances of the Trustee, its agents and
counsel, and any other amounts due the Trustee under Section 8.07 hereof.
SECTION 7.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee for amounts due under Section 8.07 hereof;
-----
Second: to Debentureholders for amounts due and unpaid on the
------
Debentures for Principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Debentures for Principal and interest, respectively; and
Third: to the Corporation.
-----
The Trustee may fix a record date and payment date for any payment to
Debentureholders pursuant to this Article.
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SECTION 7.11. UNDERTAKING FOR COSTS.
Subject to the provisions of Section 8.02 hereof, in any suit for the
enforcement of any right or remedy under this Indenture or in any suit
against the Trustee for any action taken or omitted by it as Trustee, a court
in its discretion may require the filing by any party litigant in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys' fees, 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
does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 7.07 hereof or a suit by Holders of more than 10% in principal amount
of the Debentures.
SECTION 7.12. WAIVER OF STAY OR EXTENSION LAWS.
The Corporation covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension
law wherever enacted, now or at any time hereafter in force, which may affect
the covenants or the performance of this Indenture; and the Corporation (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
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SECTION 7.13. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under the Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case the Corporation,
the Trustee and the Holders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the
Holders shall continue as though no such proceeding had been instituted.
SECTION 7.14. RECORD DATE FOR VOTE OF DEBENTUREHOLDERS.
The Corporation may set a record date for purposes of determining the
identity of Debentureholders entitled to vote or consent to any action by
vote or consent authorized or permitted by Sections 7.04 and 7.05 hereof.
Such record date shall be the later of 30 days prior to the first
solicitation of such consent or the date of the most recent list of Holders
furnished to the Trustee pursuant to Section 2.05 hereof prior to such
solicitation.
ARTICLE 8 - TRUSTEE
SECTION 8.01. 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 their
exercise as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others; 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 liability for its own
negligent action, its own gross 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;
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust 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 7.05 hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this
Section 8.01.
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(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives 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 otherwise agreed with the Corporation. Money held
in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 8.02. RIGHTS OF TRUSTEE.
Except as otherwise provided in Section 8.01 hereof:
(a) The Trustee may rely on 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. The Trustee shall
not be liable for any action it takes or omits to take in good
faith in reliance on the Officers' Certificate or Opinion of
Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within
its rights or powers.
SECTION 8.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Debentures and may otherwise deal with the Corporation or
an Affiliate with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to
the requirements set forth in Sections 8.10 and 8.11 hereof.
SECTION 8.04. TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Debentures, it shall not be accountable for the
Corporation's use of the proceeds from the Debentures, and it shall not be
responsible for any statement in the Debentures other than its
authentication.
SECTION 8.05. NOTICE OF DEFAULTS.
If a Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to Debentureholders, in the manner and to the
extent provided in TIA Sec. 313(c), a notice of the Default within 90 days
after it occurs. Except in the case of a Default in payment of the Principal
of or interest on any Debenture, the Trustee may withhold the notice if and
so long as the Board of Directors, the Executive Committee or a committee of
its Trust Officers in good faith determines that withholding the notice is in
the interests of Debentureholders.
SECTION 8.06. REPORTS BY TRUSTEE TO HOLDERS.
On or before each June 15 beginning with the June 15 following the date
of this Indenture, the Trustee shall mail to each Debentureholder a brief
report, dated as of such reporting date, with respect to any of the events
listed in TIA Sec. 313(a) which may have occurred within the previous 12
months, but if no such event has occurred within such period no such report
need be mailed. The
26
Trustee also shall comply with TIA Sec. 313(b)(2).
A copy of each report required in this Section shall be mailed to such
Debentureholders as required by TIA Sec. 313(c) and shall, at the time of its
mailing to such Debentureholders, be filed with the Corporation, the SEC and
each stock exchange on which the Debentures are listed. The Corporation
shall notify the Trustee when the Debentures are listed on any stock
exchange.
SECTION 8.07. COMPENSATION AND INDEMNITY.
The Corporation shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. If an
Event of Default should occur, the Trustee shall be entitled to reasonable
additional compensation for all additional or extraordinary services rendered
and expenses (including counsel fees) incurred in connection with said Event
of Default.
The Corporation shall indemnify the Trustee against any loss or
liability incurred by it. The Trustee shall notify the Corporation promptly
of any claim for which it may seek indemnity. The Corporation shall defend
the claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel, and the Corporation shall pay the reasonable fees and
expenses of such counsel. The Corporation need not pay for any settlement
made without its consent.
The Corporation need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through negligence or bad faith.
To secure the Corporation's payment obligations in this Section, the
Trustee shall have a lien prior to the Debentures on all money or property
held or collected by the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 7.01(5) or (6) hereof occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 8.08. REPLACEMENT OF TRUSTEE.
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.
The Trustee may resign by so notifying the Corporation. The Holders of
a majority in principal amount of the Debentures may remove the Trustee by so
notifying the Trustee and the Corporation. The Corporation may remove the
Trustee if:
(1) the Trustee fails to comply with Section 8.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or public officer takes charge of the Trustee or its
property;
(4) the Trustee becomes incapable of acting; or
(5) the Trustee fails to comply with TIA Sec. 310(b) after an Event of
Default.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Corporation shall promptly appoint a
successor Trustee. Within one year after the successor Trustee assumes
office, the Holders of a majority in principal amount of the Debentures
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may appoint a successor Trustee to replace the successor Trustee appointed by
the Corporation.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Corporation
or the Holders of at least 10% in principal amount of the Debentures then
outstanding may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 8.10 hereof, any
Debentureholder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Corporation. 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 Debentureholders. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, subject
to the lien provided for in Section 8.07 hereof.
SECTION 8.09. 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 resulting, surviving or transferee corporation without any further act
shall be the successor Trustee.
SECTION 8.10. ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Sec. 310(a)(1). The Trustee shall always have a combined
capital and surplus of at least $15,000,000 as set forth in its most recent
published annual report of condition. Neither the Corporation nor any
Affiliate shall serve as Trustee upon the Debentures or pursuant to this
Indenture. The Trustee is subject to TIA Sec. 310(b).
SECTION 8.11. PREFERENTIAL COLLECTION OF CLAIMS
AGAINST CORPORATION.
The Trustee is subject to TIA Sec. 311(a), excluding any creditor
relationship listed in TIA Sec. 311(b). A Trustee who has resigned or been
removed is subject to TIA Sec. 311(a) to the extent indicated.
SECTION 8.12. APPOINTMENT OF CO-TRUSTEE.
It is the purpose of this Indenture that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as trustee in such
jurisdiction. It is recognized that in case of litigation under this
Indenture, and in particular in case of the enforcement of an Event of
Default, or in case the Trustee deems that by reason of any present or future
law of any jurisdiction it may not exercise any of the powers, rights or
remedies herein granted to the Trustee in trust, as herein granted, or take
any other action which may be desirable or necessary in connection therewith,
it may be necessary that an additional individual or institution be appointed
as a separate or Co-Trustee.
At any time or times, for the purpose of meeting the legal requirements
of any jurisdiction, the Trustee and the Corporation may appoint an
additional individual or institution as a separate or Co-Trustee, in which
event each and every remedy, power, right, claim, demand, cause of action,
immunity, estate, title, interest and lien expressed or intended by this
Indenture, to be exercised by
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or vested in or conveyed to the Trustee with respect thereto shall be
exercisable by and vest in such separate or Co-Trustee but only to the extent
necessary to enable such separate or Co-Trustee to exercise such powers, rights
and remedies, and every covenant and obligation necessary to the exercise
thereof by such separate or Co-Trustee shall run to and be enforceable by either
of them. If the Corporation does not join in such appointment within 15 days
after receipt by it of a request so to do, or in case an Event of Default has
occurred and is continuing, the Trustee alone shall have power to make such
appointment.
Should any deed, conveyance or instrument in writing from the
Corporation be required by the separate or Co-Trustee so appointed by the
Trustee for more fully and certainly vesting in and confirming to it such
properties, rights, powers, trusts, duties and obligations, including
particularly the right to be paid its fees for services rendered, any and all
such deeds, conveyances and instruments in writing shall, on request, be
executed, acknowledged and delivered by the Corporation. In case any
separate or Co-Trustee, or a successor to either, shall die, become incapable
of acting, resign or be removed, all the estates, properties, rights, powers,
trusts, duties and obligations of such separate or Co-Trustee, so far as
permitted by law, shall vest in and be exercised by the Trustee until the
appointment of a new Trustee or successor to such separate or Co-Trustee.
The rights, powers, duties and obligations hereby conferred or imposed
upon the Trustee in respect of this Indenture shall be conferred or imposed
upon and exercised or performed by the Trustee or by the Trustee and such
separate or Co-Trustee jointly, as shall be provided in the instrument
appointing such separate or Co-Trustee, except to the extent that under any
law of any jurisdiction in which any particular act is to be performed, the
Trustee shall be incompetent or unqualified to perform such act, in which
event such rights, powers, duties and obligations shall be exercised and
performed by such separate or Co-Trustee
ARTICLE 9 - DISCHARGE OF INDENTURE
SECTION 9.01. TERMINATION OF CORPORATION'S OBLIGATIONS.
The Corporation may at any time terminate all of its obligations under
this Indenture if:
(1) the Corporation provides written notice to the Trustee of the
Corporation's intent to terminate its obligation under this
Indenture;
(2) the Debentures mature within one year of the Corporation's written
notice of its intent to terminate or all of the Debentures are to
be called for redemption within one year of the Corporation's
written notice of its intent to terminate under arrangements
satisfactory to the Trustee for giving the notice of redemption;
and
29
(3) the Corporation irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations sufficient to pay Principal
and interest on the Debentures at maturity or on redemption, as
the case may be. The Corporation may make the deposit only during
the one-year period referred to in paragraph (2) above.
However, the Corporation's obligations in Sections 2.03, 2.04, 2.05,
2.06, 2.07, 5.01, 8.07, 8.08 and 9.03 hereof shall survive until the
Debentures are no longer outstanding. Thereafter, the Corporation's
obligations in Sections 8.07 and 9.03 hereof shall survive.
After a deposit the Trustee upon request shall acknowledge in writing
the discharge of the Corporation's obligations under this Indenture except
for those surviving obligations specified above.
In order to have money available on a payment date to pay Principal or
interest on the Debentures, the U.S. Government Obligations shall be payable
as to principal or interest on or before such payment date in such amounts as
will provide the necessary money. The U.S. Government Obligations shall not
be callable at the issuer's option.
SECTION 9.02. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 9.01 hereof. It shall apply the
deposited money and the money from the U.S. Government Obligations through
the Paying Agent and in accordance with this Indenture to the payment of
Principal and interest on the Debentures.
SECTION 9.03. REPAYMENT TO CORPORATION.
The Trustee and the Paying Agent shall promptly pay to the Corporation
upon request any excess money or securities held by the Trustee as a result
of the Corporation's making payments to the Trustee and Paying Agent in
excess of that required under the provisions of this Indenture. The
obligation of the Trustee and the Paying Agent to pay such excess money or
securities to the Corporation shall survive the payment and/or cancellation
of all of the Debentures until all such excess funds or securities have been
so paid.
The Trustee and the Paying Agent shall pay to the Corporation annually
as of April 1 of each year any money held by them for the payment of
Principal or interest that remains unclaimed for two years. After payment to
the Corporation, Debentureholders entitled to the money must look to the
Corporation for payment as general creditors unless an applicable abandoned
property law designates another person.
ARTICLE 10 - AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. WITHOUT CONSENT OF HOLDERS.
The Corporation and the Trustee may amend or supplement this Indenture
or the Debentures without notice to or consent of any Debentureholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Section 6.01 hereof;
(3) to provide for uncertificated Debentures in addition to or in
place of certificated Debentures; or
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(4) to make any change that does not materially adversely affect the
rights of any Debentureholder.
SECTION 10.02. WITH CONSENT OF HOLDERS.
The Corporation and the Trustee may amend or supplement this Indenture
or the Debentures with the written consent of the Holders of at least a
majority in principal amount of the Debentures then outstanding. Without the
consent of each Debentureholder affected, however, an amendment under this
Section may not:
(1) reduce the amount of Debentures whose Holders must consent to an
amendment or waiver;
(2) reduce the rate of or change the time for payment of interest on
any Debenture;
(3) reduce the Principal of or change the maturity of any Debenture;
(4) waive a Default in the payment of the Principal of or interest on
any Debenture;
(5) make any Debenture payable in money other than that stated in the
Debenture; or
(6) modify the provisions of Sections 7.04, 7.07 and 10.02 (second
sentence) hereof.
After an amendment or supplement under this Section becomes effective,
the Corporation shall mail to Debentureholders a notice briefly describing
the amendment.
SECTION 10.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to or supplement of this Indenture or the Debentures
shall be set forth in a supplemental indenture that complies with the TIA as
then in effect.
SECTION 10.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Debenture is a continuing consent by the Holder and
every subsequent Holder of a Debenture or portion of a Debenture that
evidences the same debt as the consenting Holder's Debenture, even if
notation of the consent is not made on any Debenture. However, any such
Holder or subsequent Holder may revoke the consent as to his Debenture or
portion of a Debenture if the Trustee receives the notice of revocation
before the date the amendment, supplement or waiver becomes effective.
SECTION 10.05. NOTATION ON OR EXCHANGE OF DEBENTURES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Debenture thereafter authenticated. The
Corporation in exchange for all Debentures may issue and the Trustee shall
authenticate new Debentures that reflect the amendment, supplement or waiver.
SECTION 10.06. TRUSTEE PROTECTED.
The Trustee need not sign any supplemental indenture that adversely
affects its rights.
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ARTICLE 11 - MISCELLANEOUS
SECTION 11.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies, or conflicts with
the duties imposed by operation of TIA Sec. 318(c), the duties imposed by TIA
Sec. 318(c) shall control.
SECTION 11.02. NOTICES.
Any notice or communication by the Corporation or the Trustee to the
other is duly given if in writing and when delivered in person or mailed by
first-class mail addressed as follows:
if to the Corporation:
DELTA NATURAL GAS COMPANY, INC.
0000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Treasurer
if to the Trustee:
THE FIFTH THIRD BANK
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Corporate Trust Administration
The Corporation or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication to a Debentureholder shall be mailed by
first-class mail to his address shown on the register kept by the Registrar.
Failure to mail a notice or communication to a Debentureholder or any defect
in it shall not affect its sufficiency with respect to other
Debentureholders.
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 Corporation mails a notice or communication to Debentureholders,
it shall mail a copy to the Trustee and each Agent at the same time.
All notices or communications shall be in writing, except as set forth
below.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice required
by this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
SECTION 11.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Debentureholders may communicate pursuant to TIA Sec. 312(b) with other
Debentureholders with respect to their rights under this Indenture or the
Debentures. The Corporation, the Trustee, the Registrar and anyone else
shall have the protection of TIA Sec. 312(c).
SECTION 11.04. CERTIFICATE AND OPINION AS TO CONDITIONS
PRECEDENT.
Upon any request or application by the Corporation to the Trustee to
take any action under this Indenture, the Corporation shall furnish to the
Trustee:
32
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with;
and
(2) an Opinion of Counsel addressed to the Trustee and upon which the
Trustee may rely, stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 11.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the persons making such Officers' Certificate or
Opinion of Counsel have 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 Officers' Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such person, he has made
such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such persons,
such condition or covenant has been complied with.
SECTION 11.06. RULES BY TRUSTEE AND AGENT.
The Trustee may make reasonable rules for action by, or a meeting
of, Debentureholders. The Registrar or Paying Agent may make reasonable
rules and set reasonable requirements for its functions.
SECTION 11.07. LEGAL HOLIDAYS.
A "LEGAL HOLIDAY" is a Saturday, a Sunday, or a day on which banking
institutions in Cincinnati, Ohio, are not required to be open. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that
place on the next succeeding day that is not a Legal Holiday, and no interest
shall accrue for the intervening period.
SECTION 11.08. NO RECOURSE AGAINST OTHERS.
No liability under the Debentures shall inure to any director, officer,
employee or stockholders, as such, of the Corporation and each
Debentureholder, by accepting the Debenture, waives and releases all such
liability.
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SECTION 11.09. DUPLICATE ORIGINALS.
The parties may sign any number of copies of this Indenture. One
signed copy is enough to prove this Indenture.
SECTION 11.10. GOVERNING LAW.
This Indenture and the Debentures shall be governed by and construed in
accordance with the laws of the Commonwealth of Kentucky, without reference
to its principles of conflicts of laws.
SECTION 11.11. TABLE OF CONTENTS, HEADINGS, ETC.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SIGNATURES
Dated: , 1998 DELTA NATURAL GAS COMPANY, INC.
-------------- ("Corporation")
(SEAL) By:
---------------------------
Its: President and Chief
Executive Officer
Dated: , 1998 THE FIFTH THIRD BANK
-------------- ("Trustee")
By:
---------------------------
Its: Trust Officer
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FORM OF GLOBAL SECURITY
EXHIBIT A
THIS DEBENTURE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR
NOMINEE OF A DEPOSITORY. THIS GLOBAL SECURITY IS EXCHANGEABLE FOR DEBENTURES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
ONLY IN LIMITED CIRCUMSTANCES HEREINAFTER DESCRIBED AND MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER
NOMINEE OF THE DEPOSITORY.
Unless this certificate is presented by an authorized representative of
THE DEPOSITORY TRUST COMPANY, a New York corporation ("DTC"), to Delta
Natural Gas Company, Inc., a Kentucky corporation, or its agent for
registration of transfer, exchange, or payment, and any certificate issued is
registered in the name of CEDE & CO. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or
to such other entity as is requested by an authorized representative of DTC),
ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.
DELTA NATURAL GAS COMPANY, INC.
% DEBENTURE DUE APRIL 1, 2018
-----
$25,000,000
No. CUSIP No.
----------------------- -------------------
DELTA NATURAL GAS COMPANY, INC., a Kentucky corporation, for value
received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal sum of TWENTY- FIVE MILLION DOLLARS on April 1, 2018, and to pay
interest on said principal sum at the rate of % per annum
--------------
calculated on the basis of a 360-day year of twelve 30-day months.
1. INTEREST.
DELTA NATURAL GAS COMPANY, INC. ("CORPORATION"), a Kentucky
corporation, promises to pay interest on the principal amount of this
Debenture at the rate per annum shown above. The Corporation will pay
interest semi-annually on April 1 and October 1 of each year (each such date
being an "INTEREST PAYMENT DATE"), commencing October 1, 1998. Interest on
the Debentures will accrue from the most recent date to which interest has
been paid, or, if no interest has been paid previously, from the date of
original issuance of this Debenture; provided that, if there is no existing
default in the payment of interest, and if this Debenture is authenticated
between a "Record Date" (as hereinafter defined) and the next succeeding
Interest Payment Date, interest shall accrue from the next Interest Payment
Date. The term "RECORD DATE" as used herein shall mean the March 15 or
September 15, as the case may be, immediately preceding each Interest Payment
Date.
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35
2. METHOD OF PAYMENT.
The Corporation will pay interest on the Debentures (except defaulted
interest) to the Paying Agent who will then pay such interest to the Persons
who are registered Holders of Debentures at the close of business on the
Record Date next preceding the Interest Payment Date. The Corporation shall
pay appropriate amounts to the Paying Agent in immediately available funds at
least one (1) business day preceding the Interest Payment Date. The Paying
Agent will pay interest to such Holders on the next Interest Payment Date
even though Debentures are canceled after the Record Date but on or before
the Interest Payment Date. Holders must surrender Debentures to the Paying
Agent to collect Principal payments; except that, with respect to a Global
Security, the Depository need not surrender the Global Security to collect
payments of Principal other than the final payment of Principal of such
Global Security, provided that the Depository makes appropriate endorsement
on such Global Security of such prepayments on the Table of Prepayments. The
Paying Agent will pay Principal and interest in money of the United States
that at the time of payment is legal tender for payment of public and private
debts. However, except as set forth in the last sentence of this paragraph:
(i) the Paying Agent may pay Principal and interest by check payable in such
money; and (ii) the Paying Agent may mail an interest check to a Holder's
registered address. Any Holder of at least $1,000,000 aggregate principal
amount of Debentures shall have the right to receive payment of Principal of
and interest on the Debentures by wire transfer of funds, provided that such
Debentureholder requests such form of payment, accompanied by appropriate
wire transfer instructions, by written notice to the Trustee and the Paying
Agent given not later than the Record Date immediately preceding such
payment.
3. PAYING AGENT AND REGISTRAR.
Initially, The Fifth Third Bank, 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx,
Xxxx 00000, will act as Paying Agent and Registrar. The Corporation may
change any Paying Agent, Registrar or Co-Registrar without notice. The
Corporation or any of its Subsidiaries may act in any such capacity.
4. INDENTURE.
The Corporation issued the Debentures under an Indenture dated as of
March 1, 1998 ("INDENTURE"), between the Corporation and the Trustee. The
terms of the Debentures include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15
U.S.C. Sections 77aaa-77bbbb) (the "ACT") as in effect on the date of the
Indenture. The Debentures are subject to all such terms, and
Debentureholders are referred to the Indenture and the Act for a statement of
such terms. Capitalized terms used but not otherwise defined herein shall
have the same meanings such terms are given in the Indenture. The Debentures
are unsecured general obligations of the Corporation limited to $25,000,000
in aggregate principal amount.
5. REDEMPTION AT CORPORATION'S OPTION.
The Corporation may, at its option, at any time on or after April 1,
2003, redeem all the Debentures or some of them from time to time at a
Redemption Price equal to 100% of the principal amount thereof plus unpaid
accrued interest to the Redemption Date.
Notice of redemption at the Corporation's option will be mailed at
least 30 days before the Redemption Date to each Holder of Debentures to be
redeemed at his registered address as set forth
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36
in the register. Debentures in denominations larger than $1,000 may be redeemed
in part but only in integral multiples of $1,000. On and after the Redemption
Date (if there is no default in the payment of the Redemption Price by the
Corporation), interest ceases to accrue on Debentures or portions thereof called
for redemption. The Corporation shall have the right, at its option, to
withdraw and rescind, in whole or in part, any such optional redemption by the
Corporation and any such notice of redemption given in connection therewith
up to five (5) days prior to the Redemption Date by written notice of such
withdrawal to the Trustee and to the Debentureholders affected thereby.
6. REDEMPTION AT BENEFICIAL OWNER'S OPTION.
For purposes hereof, a "BENEFICIAL OWNER" means the Person who has the
right to sell, transfer or otherwise dispose of an interest in this Debenture
and the right to receive the proceeds therefrom, as well as the interest and
Principal payable to the Holder hereof. In general, a determination of
beneficial ownership in this Debenture will be subject to the rules,
regulations and procedures governing the Depository and institutions that
have accounts with the Depository or a nominee thereof ("PARTICIPANTS").
Participants may hold interests in this Debenture as Beneficial Owners for
their own accounts, or as nominees for other persons.
Unless the Debentures have been declared due and payable prior to their
maturity by reason of an Event of Default, the Representative (as hereinafter
defined) of a deceased Beneficial Owner has the right to request redemption
of all or part of his interest, expressed in integral multiples of $1,000
principal amount, in this Debenture for payment prior to its maturity, and
the Corporation will redeem the same subject to the limitations that the
Corporation will not be obligated to redeem, during the period from the
original issuance of the Debentures through and including April 1, 1999 (the
"INITIAL PERIOD"), and during any twelve-month period which ends on and
includes each April 1 thereafter (each such twelve-month period being
hereinafter referred to as a "SUBSEQUENT PERIOD"), (i) on behalf of a
deceased Beneficial Owner any interest in this Debenture which exceeds an
aggregate principal amount of $25,000 or (ii) interests in this Debenture in
an aggregate principal amount exceeding $750,000. In the case of interests
in this Debenture owned by a deceased Beneficial Owner, a request for
redemption may be presented to the Trustee at any time and in any principal
amount. If the Corporation, although not obligated to do so, chooses to
redeem interests of any deceased Beneficial Owner in this Debenture in the
Initial Period or any Subsequent Period in excess of the $25,000 limitation,
such redemption, to the extent that it exceeds the $25,000 limitation for any
deceased Beneficial Owner, shall not be included in the computation of the
$750,000 limitation for such Initial Period or such Subsequent Period, as the
case may be, or for any succeeding Subsequent Period.
Subject to the $25,000 and $750,000 limitations, the Corporation will,
upon the death of any Beneficial Owner, redeem the interest of such
Beneficial Owner in this Debenture within 60 days following receipt by the
Trustee of a Redemption Request (as herein defined) from such Beneficial
Owner's personal representative, or surviving joint tenant(s), tenant(s) by
the entirety or tenant(s) in common, or other Persons entitled hereunder to
effect such a Redemption Request (each, a "REPRESENTATIVE"). If Redemption
Requests exceed the aggregate principal amount of interests in Debentures
required to be redeemed during the Initial Period or during any Subsequent
Period, then such excess Redemption Requests will be applied to successive
Subsequent Periods, regardless of the number of Subsequent Periods required
to redeem such interests.
A request for redemption of an interest in this Debenture may be made
by delivering a request to the Depository, in the case of a Participant which
is the Beneficial Owner of such interest, or to the Participant through whom
the Beneficial Owner owns such interest, in form
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37
satisfactory to the Participant, together with evidence of the death of the
Beneficial Owner and evidence of the authority of the Representative
satisfactory to the Participant and Trustee. A Representative of a deceased
Beneficial Owner may make the request for redemption and shall submit such other
evidence of the right to such redemption as the Participant or Trustee shall
require. The request shall specify the principal amount of the interest in this
Debenture to be redeemed. A request for redemption in the form satisfactory to
the Participant and accompanied by the documents relevant to the request as
above provided, together with a certification by the Participant that it holds
the interest on behalf of the deceased Beneficial Owner with respect to whom the
request for redemption is being made (a "REDEMPTION REQUEST"), shall be
provided to the Depository by a Participant and the Depository will forward
the request to the Trustee. Redemption Requests shall be in form
satisfactory to the Trustee.
The price to be paid by the Corporation for interests in the Debentures
to be redeemed pursuant to a Redemption Request from a deceased Beneficial
Owner's Representative is 100% of the principal amount thereof plus accrued
but unpaid interest to the date of payment. Subject to arrangements with the
Depository, payment for interests in the Debentures which are to be redeemed
shall be made to the Depository upon presentation of Debentures to the
Trustee for redemption in the aggregate principal amount specified in the
Redemption Requests submitted to the Trustee by the Depository which are to
be fulfilled in connection with such payment. Any acquisition of Debentures
by the Corporation or its Subsidiaries other than by redemption at the option
of any Representative of a deceased Beneficial Owner pursuant to this
paragraph 6 shall not be included in the computation of either the $25,000 or
the $750,000 limitation for the Initial Period or for any Subsequent Period.
For purposes of this paragraph 6, an interest in a Debenture held in
tenancy by the entirety, joint tenancy or by tenants in common will be deemed
to be held by a single Beneficial Owner and the death of a tenant by the
entirety, joint tenant or tenant in common will be deemed the death of a
Beneficial Owner. The death of a person, who, during his lifetime, was
entitled to substantially all of the rights of a Beneficial Owner of an
interest in this Debenture will be deemed the death of the Beneficial Owner,
regardless of the recordation of such interest on the records of the
Participant, if such rights can be established to the satisfaction of the
Participant and the Trustee. Such interests shall be deemed to exist in
typical cases of street name or nominee ownership, ownership under the
Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act, community
property or other joint ownership arrangements between a husband and wife
(including individual retirement accounts or Xxxxx [H.R. 10] plans maintained
solely by or for the decedent or by or for the decedent and his spouse), and
trust and certain other arrangements where one Person has substantially all
of the rights of a Beneficial Owner during his lifetime. Beneficial
interests shall include the power to sell, transfer or otherwise dispose of
an interest in this Debenture and the right to receive the proceeds
therefrom, as well as interest and Principal payable with respect thereto.
In the case of any Redemption Request which is presented pursuant to
this paragraph 6 and which has not been fulfilled at the time the Corporation
gives notice of its election to redeem Debentures pursuant to paragraph 5,
such interest or portion thereof shall not be subject to redemption pursuant
to paragraph 5 but shall remain subject to redemption pursuant to this
paragraph 6.
Subject to the provisions of the immediately preceding sentence, any
Redemption Request may be withdrawn by the Person(s) presenting the same upon
delivery of a written request for such withdrawal given by the Depository to
the Trustee prior to the issuance of a check in payment of such Redemption
Request.
A-4
38
7. DENOMINATIONS, TRANSFER AND EXCHANGE.
The Debentures are in registered form without coupons in denominations
of $1,000 and integral multiples thereof. The transfer of Debentures shall
be registered and Debentures may be exchanged as provided in the Indenture.
The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not
exchange or register the transfer of any Debenture or portion of a Debenture
selected for redemption. Also, it need not exchange or register the transfer
of any Debentures during that period of time subsequent to any Record Date
and prior to the next succeeding Interest Payment Date.
A-5
39
8. PERSONS DEEMED OWNERS.
The registered Holder of a Debenture may be treated as its owner for
all purposes.
9. AMENDMENTS, SUPPLEMENTS AND WAIVERS.
Subject to certain exceptions, the Indenture or the Debentures may be
amended or supplemented, and any existing Default may be waived, with the
consent of Holders of a majority in principal amount of the Debentures then
outstanding. Without the consent of any Debentureholder, the Indenture or
the Debentures may be amended or supplemented, for among other reasons, to
cure any ambiguity, defect or inconsistency, to provide for assumption of
Corporation obligations to Debentureholders or to make any change that does
not materially adversely affect the rights of any Debentureholder.
10. DEFAULTS AND REMEDIES.
An Event of Default is: default for 30 days in payment of interest on
the Debentures; default in payment of Principal of the Debentures; failure by
the Corporation for 60 days after notice to it to comply with any of its
other agreements in the Indenture or the Debentures; default in the payment
of Indebtedness having an outstanding principal balance of $100,000 or more
under certain circumstances; and certain events of bankruptcy or insolvency.
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in principal amount of the Debentures may declare all the
Debentures to be due and payable immediately. Debentureholders may not
enforce the Indenture or the Debentures except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Debentures. Subject to certain limitations, Holders of a
majority in principal amount of the Debentures may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from
Debentureholders notice of any continuing Default (except a default in
payment of Principal or interest) if it determines that withholding notice is
in their interests. The Corporation must furnish an annual Officers'
Certificate to the Trustee.
The Trustee shall not be charged with knowledge of any Event of Default
as defined in the Indenture, unless written notice thereof shall have been
given to a Trust Officer of the Trustee at the Corporate Trust Office by the
Corporation, the Paying Agent, the Holder of a Debenture or an agent of such
Holder.
11. TRUSTEE DEALINGS WITH CORPORATION.
The Fifth Third Bank, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from,
and perform services for the Corporation or its Affiliates, and may otherwise
deal with the Corporation or its Affiliates, as if it were not Trustee,
subject to any limitations imposed by the Act.
X-0
00
00. NO RECOURSE AGAINST OTHERS.
A director, officer, employee or stockholder, as such, of the
Corporation shall not have any liability for any obligations of the
Corporation under the Debentures or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their creation. Each
Debentureholder by accepting a Debenture waives and releases all such
liability. The waiver and release are part of the consideration for the
issue of the Debentures.
13. AUTHENTICATION.
This Debenture shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent.
14. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Debentureholder 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).
Dated:
Authenticated:
THE FIFTH THIRD BANK, DELTA NATURAL GAS
AS TRUSTEE COMPANY, INC.
By: By:
--------------------------- ---------------------------
Its: Authorized Signer Its: President
By:
---------------------------
Its: Corporate Secretary
(SEAL)
------------------
The Corporation will furnish to any Debentureholder upon written request and
without charge a copy of the Indenture, which has in it the text of this
Debenture in larger type. Requests may be made to: Treasurer, Delta Natural
Gas Company, Inc., 0000 Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000.
A-7
41
------------------
TABLE OF PREPAYMENTS
Upon all partial payments of principal of the within Debenture, this
Debenture shall be surrendered to the Trustee for issuance of a new Debenture
unless the registered Holder hereof shall make appropriate endorsements on
the table below indicating the amount of principal so prepaid, prior to any
transfer to this Debenture. Any purchaser or transferee of this Debenture
shall verify with the Trustee the principal balance outstanding prior to the
purchase or transfer hereof.
PRINCIPAL REMAINING UNPAID
DATE AMOUNT PAID PRINCIPAL BALANCE SIGNATURE
---- ----------- ----------------- ---------
X-0
00
XXXXXXXXXX XXXX
X/Xx assign and transfer this Debenture to
[ ]
---------------------------
(Insert assignee's social
security or tax I.D. number)
-----------------------------------------------------------------
-----------------------------------------------------------------
-----------------------------------------------------------------
(Print or type name, address and zip code of assignee)
and irrevocably appoint agent to transfer
----------------------------------
this Debenture on the books of the Corporation. The agent may substitute
another to act for him.
Date: Signature:
------------------- -----------------------------------
(Sign exactly as your
name appears on this
Debenture)
Signature Guarantee
-------------------------
A-9
43
FORM OF DEBENTURE
EXHIBIT B
(Face of Debenture)
DELTA NATURAL GAS COMPANY, INC.
% DEBENTURE DUE 2018
----
No. $
---------------------- -------------------------
DELTA NATURAL GAS COMPANY, INC., a Kentucky corporation, for value
received, hereby promises to pay to , or registered
------------------------
assigns, the principal sum of DOLLARS on April 1,
----------------------
2018, and to pay interest on said principal sum at the rate of %
----------
per annum calculated on the basis of a 360-day year of twelve 30-day months.
INTEREST PAYMENT DATES: April 1 and October 1
RECORD DATES: March 15 and September 15
Dated:
Authenticated:
THE FIFTH THIRD BANK, DELTA NATURAL GAS
AS TRUSTEE COMPANY, INC.
By: By:
-------------------------- ---------------------------
Its: Authorized Signer Its: President
By:
---------------------------
Its: Corporate Secretary
(SEAL)
B-1
44
(Back of Debenture)
DELTA NATURAL GAS COMPANY, INC.
% DEBENTURE DUE APRIL 1, 2018
----
1. INTEREST.
DELTA NATURAL GAS COMPANY, INC. ("CORPORATION"), a Kentucky
corporation, promises to pay interest on the principal amount of this
Debenture at the rate per annum shown above. The Corporation will pay
interest semi-annually on April 1 and October 1 of each year (each such date
being an "Interest Payment Date"), commencing October 1, 1998. Interest on
the Debentures will accrue from the most recent date to which interest has
been paid, or, if no interest has been paid previously, from the date of
original issuance of this Debenture; provided that, if there is no existing
default in the payment of interest, and if this Debenture is authenticated
between a Record Date referred to on the face hereof and the next succeeding
Interest Payment Date, interest shall accrue from the next Interest Payment
Date.
2. METHOD OF PAYMENT.
The Corporation will pay interest on the Debentures (except defaulted
interest) to the Paying Agent who will then pay such interest to the Persons
who are registered Holders of Debentures at the close of business on the
Record Date next preceding the Interest Payment Date. The Corporation shall
pay appropriate amounts to the Paying Agent in immediately available funds at
least one (1) business day preceding the Interest Payment Date. The Paying
Agent will pay interest to such Holders on the next Interest Payment Date
even though Debentures are canceled after the Record Date but on or before
the Interest Payment Date. Holders must surrender Debentures to the Paying
Agent to collect Principal payments. The Paying Agent will pay Principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, except as set forth
in the last sentence of this paragraph: (i) the Paying Agent may pay
Principal and interest by check payable in such money; and (ii) the Paying
Agent may mail an interest check to a Holder's registered address. Any
Holder of at least $1,000,000 aggregate principal amount of Debentures shall
have the right to receive payment of Principal of and interest on the
Debentures by wire transfer of funds, provided that such Debentureholder
requests such form of payment, accompanied by appropriate wire transfer
instructions, by written notice to the Trustee and the Paying Agent given not
later than the Record Date immediately preceding such payment.
3. PAYING AGENT AND REGISTRAR.
Initially, The Fifth Third Bank, 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx,
Xxxx 00000, will act as Paying Agent and Registrar. The Corporation may
change any Paying Agent, Registrar or Co-Registrar without notice. The
Corporation or any of its Subsidiaries may act in any such capacity.
4. INDENTURE.
The Corporation issued the Debentures under an Indenture dated as of
March 1, 1998 ("INDENTURE"), between the Corporation and the Trustee. The
terms of the Debentures include those stated in the Indenture and those made
part of the Indenture by reference to the Trust
B-2
45
Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "ACT") as in effect
on the date of the Indenture. The Debentures are subject to all such terms, and
Debentureholders are referred to the Indenture and the Act for a statement of
such terms. Capitalized terms used but not otherwise defined herein shall
have the same meanings such terms are given in the Indenture. The Debentures
are unsecured general obligations of the Corporation limited to $25,000,000
in aggregate principal amount.
5. REDEMPTION AT CORPORATION'S OPTION.
The Corporation may, at its option, at any time on or after April 1,
2003, redeem all the Debentures or some of them from time to time at a
Redemption Price equal to 100% of the principal amount thereof plus unpaid
accrued interest to the Redemption Date.
Notice of redemption at the Corporation's option will be mailed at
least 30 days before the Redemption Date to each Holder of Debentures to be
redeemed at his registered address as set forth in the register. Debentures
in denominations larger than $1,000 may be redeemed in part but only in
integral multiples of $1,000. On and after the Redemption Date (if there is
no default in the payment of the Redemption Price by the Corporation),
interest ceases to accrue on Debentures or portions thereof called for
redemption. The Corporation shall have the right, at its option, to withdraw
and rescind, in whole or in part, any such optional redemption by the
Corporation and any such notice of redemption given in connection therewith
up to five (5) days prior to the Redemption Date by written notice of such
withdrawal to the Trustee and to the Debentureholders affected thereby.
6. REDEMPTION AT HOLDER'S OPTION.
Unless the Debentures have been declared due and payable prior to their
maturity by reason of an Event of Default, the Representative (as hereinafter
defined) of a deceased Debentureholder has the right to present Debentures
for payment prior to their maturity, and the Corporation will redeem the same
subject to the limitations that the Corporation will not be obligated to
redeem, during the period from the original issuance of the Debentures
through and including April 1, 1999 (the "INITIAL PERIOD"), and during any
twelve-month period which ends on and includes each April 1 thereafter (each
such twelve-month period being hereinafter referred to as a "SUBSEQUENT
PERIOD"), (i) Debentures presented on behalf of a deceased Debentureholder
exceeding an aggregate principal amount of $25,000 or (ii) Debentures in an
aggregate principal amount exceeding $750,000. In the case of Debentures
owned by a deceased Holder, Debentures may be presented to the Trustee for
redemption at any time and in any principal amount. If the Corporation,
although not obligated to do so, chooses to redeem Debentures of any deceased
Debentureholder in any such period in excess of the $25,000 limitation, such
redemption, to the extent that it exceeds the $25,000 limitation for any
deceased Debentureholder, shall not be included in the computation of the
$750,000 limitation for such Initial Period or such Subsequent Period, as the
case may be, or for any succeeding Subsequent Period.
Subject to the $25,000 and $750,000 limitations, the Corporation will,
upon the death of any Debentureholder, redeem Debentures within 60 days
following receipt by the Trustee of a request therefor from such
Debentureholder's personal representative, or surviving joint tenant(s),
tenant(s) by the entirety or tenant(s) in common, or other Persons entitled
hereunder to request such redemption (each, a "REPRESENTATIVE"). If
Debentures presented for redemption exceed the aggregate principal amount of
Debentures required to be redeemed during the Initial Period or during any
Subsequent Period, then such excess Debentures presented for redemption will
be applied to successive Subsequent Periods, regardless of the number of
Subsequent Periods
B-3
46
required to redeem such Debentures.
Debentures may be presented for redemption by delivering to the
Trustee: (i) a written request for redemption, in form satisfactory to the
Trustee, signed by the Representative of the deceased Debentureholder, (ii)
the Debenture(s) to be redeemed and (iii) appropriate evidence of death of
the Debentureholder and appropriate evidence of the authority of the
Representative of the deceased Debentureholder. No particular forms of
request for redemption or authority to request redemption are necessary. The
price to be paid by the Corporation for all Debentures presented to it
pursuant to the provisions described in this paragraph 6 is 100% of the
principal amount thereof plus accrued but unpaid interest to the date of
payment. Any acquisition of Debentures by the Corporation or its
Subsidiaries other than by redemption at the option of any Representative of
a deceased Debentureholder pursuant to this paragraph 6 shall not be included
in the computation of either the $25,000 or the $750,000 limitation for the
Initial Period or for any Subsequent Period.
For purposes of this paragraph 6, a Debenture held in tenancy by the
entirety, joint tenancy or by tenants in common will be deemed to be held by
a single Debentureholder and the death of a tenant by the entirety, joint
tenant or tenant in common will be deemed the death of a Debentureholder.
The death of a person, who, during his lifetime, was entitled to
substantially all of the beneficial interests of ownership of a Debenture
will be deemed the death of the Debentureholder, regardless of the registered
Debentureholder, if such beneficial interest can be established to the
satisfaction of the Trustee. Such beneficial interest shall be deemed to
exist in typical cases of street name or nominee ownership, ownership under
the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act,
community property or other joint ownership arrangements between a husband
and wife (including individual retirement accounts or Xxxxx [H.R. 10] plans
maintained solely by or for the decedent or by or for the decedent and his
spouse), and trust and certain other arrangements where one person has
substantially all of the beneficial ownership interests in the Debenture
during his lifetime. Beneficial interests shall include the power to sell,
transfer or otherwise dispose of a Debenture and the right to receive the
proceeds therefrom, as well as interest and Principal payable with respect
thereto.
In the case of Debentures held by Qualified Institutions on behalf of
beneficial owners, the $25,000 limitation shall apply to each such beneficial
owner and the death of such beneficial owner shall entitle a Qualified
Institution to seek redemption of such Debentures as if the deceased
beneficial owner were the record Debentureholder. Such Qualified
Institutions, in their request for redemption on behalf of such beneficial
owners, must submit evidence, satisfactory to the Trustee, that they hold
Debentures on behalf of such beneficial owners and must certify that the
aggregate requests for redemption tendered by such Qualified Institution on
behalf of each such beneficial owner in the Initial Period or any Subsequent
Period does not exceed $25,000. In addition, any request for redemption made
by a Qualified Institution on behalf of a beneficial owner must be delivered
to the Trustee by registered mail, return receipt requested.
In the case of any Debenture which is presented for redemption in part
only, upon such redemption the Corporation shall execute and the Trustee
shall authenticate and deliver to or on the order of the Holder of such
Debenture, without service charge to the Debentureholder, a new Debenture or
Debentures, of any authorized denomination or denominations as requested by
such Holder, in aggregate principal amount equal to the unredeemed portion of
the principal of the Debenture so presented.
In the case of any Debenture or portion thereof which is presented for
redemption pursuant to this paragraph 6 and which has not been redeemed at
the time the Corporation gives notice of its election to redeem Debentures
pursuant to paragraph 5, such Debenture or portion thereof shall not
B-4
47
be subject to redemption pursuant to paragraph 5 but shall remain subject to
redemption pursuant to this paragraph 6.
Subject to the provisions of the immediately preceding sentence, any
Debentures presented for redemption at the option of the Representative of a
deceased Debentureholder may be withdrawn by the Person(s) presenting the
same upon delivery of a written request for such withdrawal given to the
Trustee prior to the issuance of a check in payment of such Debentures
presented by reason of the death of a Debentureholder.
7. DENOMINATIONS, TRANSFER AND EXCHANGE.
The Debentures are in registered form without coupons in denominations
of $1,000 and integral multiples thereof. The transfer of Debentures shall
be registered and Debentures may be exchanged as provided in the Indenture.
The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not
exchange or register the transfer of any Debenture or portion of a Debenture
selected for redemption. Also, it need not exchange or register the transfer
of any Debentures during that period of time subsequent to any Record Date
and prior to the next succeeding Interest Payment Date.
8. PERSONS DEEMED OWNERS.
The registered Holder of a Debenture may be treated as its owner for
all purposes.
9. AMENDMENTS, SUPPLEMENTS AND WAIVERS.
Subject to certain exceptions, the Indenture or the Debentures may be
amended or supplemented, and any existing Default may be waived, with the
consent of Holders of a majority in principal amount of the Debentures then
outstanding. Without the consent of any Debentureholder, the Indenture or
the Debentures may be amended or supplemented, for among other reasons, to
cure any ambiguity, defect or inconsistency, to provide for assumption of
Corporation obligations to Debentureholders or to make any change that does
not materially adversely affect the rights of any Debentureholder.
10. DEFAULTS AND REMEDIES.
An Event of Default is: default for 30 days in payment of interest on
the Debentures; default in payment of Principal of the Debentures; failure by
the Corporation for 60 days after notice to it to comply with any of its
other agreements in the Indenture or the Debentures; default in the payment
of Indebtedness having an outstanding principal balance of $100,000 or more
under certain circumstances; and certain events of bankruptcy or insolvency.
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in principal amount of the Debentures may declare all the
Debentures to be due and payable immediately. Debentureholders may not
enforce the Indenture or the Debentures except as provided in the Indenture.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Debentures. Subject to certain limitations, Holders of a
majority in principal amount of the Debentures may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from
Debentureholders notice of any continuing Default (except a default in
payment of Principal or interest) if it determines that withholding notice is
in their interests. The Corporation must furnish an annual Officers'
Certificate to the Trustee.
The Trustee shall not be charged with knowledge of any Event of Default
as defined in the
B-5
48
Indenture, unless written notice thereof shall have been given to a Trust
Officer of the Trustee at the Corporate Trust Office by the Corporation, the
Paying Agent, the Holder of a Debenture or an agent of such Holder.
11. TRUSTEE DEALINGS WITH CORPORATION.
The Fifth Third Bank, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from,
and perform services for the Corporation or its Affiliates, and may otherwise
deal with the Corporation or its Affiliates, as if it were not Trustee,
subject to any limitations imposed by the Act.
12. NO RECOURSE AGAINST OTHERS.
A director, officer, employee or stockholder, as such, of the
Corporation shall not have any liability for any obligations of the
Corporation under the Debentures or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their creation. Each
Debentureholder by accepting a Debenture waives and releases all such
liability. The waiver and release are part of the consideration for the
issue of the Debentures.
13. AUTHENTICATION.
This Debenture shall not be valid until authenticated by the manual
signature of the Trustee or an authenticating agent.
14. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Debentureholder 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).
The Corporation will furnish to any Debentureholder upon written request and
without charge a copy of the Indenture, which has in it the text of this
Debenture in larger type. Requests may be made to: Treasurer, Delta Natural
Gas Company, Inc., 0000 Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000.
X-0
00
XXXXXXXXXX XXXX
X/Xx assign and transfer this Debenture to
[ ]
---------------------------
(Insert assignee's social
security or tax I.D. number)
-----------------------------------------------------------------
-----------------------------------------------------------------
-----------------------------------------------------------------
(Print or type name, address and zip code of assignee)
and irrevocably appoint agent to transfer this
-------------------------
Debenture on the books of the Corporation. The agent may substitute another
to act for him.
Date: Signature:
------------------- ------------------------------------
(Sign exactly as your
name appears on the
other side of this
Debenture)
Signature Guarantee
-------------------------
B-7
