Exhibit 4(vii)
SECOND SUPPLEMENTAL INDENTURE
BETWEEN
DOMINION RESOURCES, INC.
AND
THE CHASE MANHATTAN BANK
DATED AS OF ____________, ____
____% JUNIOR SUBORDINATED DEBENTURES,
DUE __________, 20__
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 Definition of Terms.................................................... 2
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED
DEBENTURES
2.1 Designation and Principal Amount....................................... 5
2.2 Stated Maturity........................................................ 5
2.3 Form and Payment; Minimum Transfer Restriction......................... 5
2.4 Exchange and Registration of Transfer of Junior Subordinated Debentures;
Restrictions on Transfers; Depositary.................................. 6
2.5 Interest............................................................... 7
ARTICLE III
[PREPAYMENT OF THE JUNIOR SUBORDINATED DEBENTURES
3.1 Tax Event or Investment Company Event Prepayment....................... 8
3.2 Optional Prepayment by Company......................................... 9
3.3 Notice of Prepayment................................................... 9
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
4.1 Extension of Interest Payment Period...................................10
4.2 Notice of Extension....................................................11
ARTICLE V
EXPENSES
5.1 Payment of Expenses....................................................11
5.2 Payment Upon Resignation or Removal....................................12
ARTICLE VI
FORM OF JUNIOR SUBORDINATED DEBENTURE
6.1 Form of Junior Subordinated Debenture..................................12
ARTICLE VII
ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES
7.1 Original issue of Junior Subordinated Debentures.......................13
i
ARTICLE VIII
MISCELLANEOUS
8.1 Ratification of Indenture; Second Supplemental Indenture Controls......13
8.2 Trustee Not Responsible for Recitals...................................13
8.3 Governing Law..........................................................13
8.4 Separability...........................................................13
8.5 Counterparts...........................................................14
Exhibit A - Form of Junior Subordinated Debenture
ii
SECOND SUPPLEMENTAL INDENTURE
SECOND SUPPLEMENTAL INDENTURE, dated as of ____________, ____ (the "Second
Supplemental Indenture"), between DOMINION RESOURCES, INC., a Virginia
corporation (the "Company"), and THE CHASE MANHATTAN BANK, as trustee (the
"Trustee") under the Indenture dated as of December 1, 1997 between the Company
and the Trustee (the "Base Indenture" and, together with the First Supplemental
Indenture dated as of December 1, 1997 and this Second Supplemental Indenture,
the "Indenture").
WHEREAS, the Company executed and delivered the Base Indenture to the
Trustee to provide for the future issuance of the Company's unsecured junior
subordinated debentures (the "Debentures") to be issued from time to time in one
or more series as might be determined by the Company under the Indenture, in an
unlimited aggregate principal amount which may be authenticated and delivered as
provided in the Base Indenture;
WHEREAS, pursuant to the terms of the Base Indenture, the Company desires
to provide for the establishment of a series of its Debentures, to be known as
its ____% Junior Subordinated Debentures due __________, 20__ (the "Junior
Subordinated Debentures"), the form and substance of such Junior Subordinated
Debentures and the terms, provisions and conditions thereof to be set forth as
provided in the Base Indenture and this Second Supplemental Indenture;
WHEREAS, the Company desires that this series of Junior Subordinated
Debentures be originally issued on __________, ____ pursuant to the Indenture
[and the Trust Agreement (as defined in Section 1.1)];
[WHEREAS, Dominion Resources Capital Trust II, a Delaware statutory
business trust (the "Trust"), has offered to the purchasers (the "Underwriters")
named in Schedule I to the Underwriting Agreement (the "Underwriting Agreement")
dated __________, ____ among the Underwriters, the Trust and the Company
$___________ aggregate liquidation amount of its ____% Capital Securities (the
"Capital Securities"), representing undivided beneficial interests in the assets
of the Trust and proposes to invest the proceeds from the sale of the Capital
Securities, together with the proceeds of the sale by the Trust to the Company
of $_________ aggregate liquidation amount of its Common Securities, in
$___________ aggregate principal amount of the Junior Subordinated Debentures;]
and
WHEREAS, the Company has requested that the Trustee execute and deliver
this Second Supplemental Indenture and all requirements necessary to make this
Second Supplemental Indenture a valid instrument in accordance with its terms,
and to make the Junior Subordinated Debentures, when executed by the Company and
authenticated and delivered by the Trustee, the valid obligations of the
Company, have been performed, and the execution and delivery of this Second
Supplemental Indenture has been duly authorized in all respects;
NOW, THEREFORE, in consideration of the purchase and acceptance of the
Junior Subordinated Debentures by the Underwriters, and for the purpose of
setting forth, as provided in
the Base Indenture, the form and substance of the Junior Subordinated Debentures
and the terms, provisions and conditions thereof, the Company covenants and
agrees with the Trustee as follows:
ARTICLE I
DEFINITIONS
1.1 Definition of Terms. For all purposes of this Second Supplemental
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
(a) the terms which are defined in the Base Indenture have the same
meanings when used in this Second Supplemental Indenture;
(b) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(c) all other terms used herein which are defined in the Trust
Indenture Act of 1939, whether directly or by reference therein, have the
meanings assigned to them therein;
(d) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States of America, and, except as otherwise herein
expressly provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall mean such
accounting principles as are generally accepted in the United States of America
at the date of such computation; provided, that when two or more principles are
so generally accepted, it shall mean that set of principles consistent with
those in use by the Company;
(e) a reference to a Section or Article is to a Section or Article of
this Second Supplemental Indenture unless otherwise stated;
(f) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Second Supplemental Indenture as a whole and not to
any particular Article, Section or other subdivision;
(g) headings are for convenience of reference only and do not affect
interpretation;
(h) the term "prepayment" as used herein means "redemption" as such
term is used in the Base Indenture; and
(i) [the following terms have the meanings given to them in the Trust
Agreement: (i) Administrative Trustee, (ii) Delaware Trustee, (iii)
Distributions, (iv) Property Trustee, and (v) Trust Securities.]
2
"Additional Interest" has the meaning specified in Section 2.5.
["Adjusted Treasury Rate" means, with respect to any prepayment date,
the Treasury Rate plus (i) [1.00]% if such prepayment date occurs on or before
__________, 20__ or (ii) [0.50]% if such prepayment date occurs after
__________, 20__.]
["Capital Securities" has the meaning specified in the fourth recital
to this Second Supplemental Indenture.]
["Comparable Treasury Issue" means with respect to any prepayment date
the United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Term To Initial Optional Prepayment Date that would
be utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the Term To Initial Optional Prepayment Date. If no United States
Treasury security has a maturity which is within a period from three months
before to three months after __________, 20__, the two most closely
corresponding United States Treasury securities shall be used as the Comparable
Treasury Issue, and the Treasury Rate shall be interpolated or extrapolated on a
straight-line basis, rounding to the nearest month using such securities.]
["Comparable Treasury Price" means, with respect to any prepayment
date, (A) the average of five Reference Treasury Dealer Quotations for such
prepayment date, after excluding the highest and lowest such Reference Treasury
Dealer Quotations, or (B) if the Trustee obtains fewer than three such Reference
Treasury Dealer Quotations, the average of all such Quotations.]
"Coupon Rate" has the meaning specified in Section 2.5(a).
"Debentures" has the meaning specified in the first recital to this
Second Supplemental Indenture.
"Definitive Debenture Certificates" means Debentures issued in
definitive, fully registered form.
["Event Prepayment Price" has the meaning specified in Section 3.1.]
"Extension Period" has the meaning specified in Section 4.1.
"Global Debenture" has the meaning specified in Section 2.4(a).
["Initial Optional Prepayment Date" has the meaning specified in
Section 3.2(a).]
"Interest Payment Date" has the meaning specified in Section 2.5.
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"Junior Subordinated Debentures" has the meaning specified in the
second recital to this Second Supplemental Indenture.
["Liquidation Amount" means the stated amount of $_____ per Capital
Security.]
["Optional Prepayment Price" has the meaning specified in Section
3.2.]
"Quotation Agent" means _____________________ and its successors.
"Record Date" has the meaning specified in Section 2.5(a).
["Reference Treasury Dealer" means (i) ___________________ , and their
respective successors; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"Primary Treasury Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer; and (ii) any other Primary Treasury Dealer selected by
the Trustee after consultation with the Company.]
["Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any prepayment date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such prepayment date.]
["Term To Initial Optional Prepayment Date" has the meaning specified
in Section 3.1.]
"Treasury Rate" means (i) the yield, under the heading which
represents the average for the immediately preceding week, appearing in the most
recently published statistical release designated "H.15 (519)" or any successor
publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Term To Initial Optional Prepayment Date (if no
maturity is within three months before or after the Term To Initial Optional
Prepayment Date, yields for the two published maturities most closely
corresponding to the Term To Initial Optional Prepayment Date shall be
determined and the Treasury Rate shall be interpolated or extrapolated from such
yields on a straight-line basis, rounding to the nearest month) or (ii) if such
release (or any successor release) is not published during the week preceding
the calculation date or does not contain such yields, the rate per annum equal
to the semi-annual equivalent yield to maturity of the Comparable Treasury
Issue, calculated using a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such prepayment date. The Treasury Rate shall be calculated on the third
Business Day preceding the prepayment date.
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["Trust" has the meaning specified in the fourth recital to this
Second Supplemental Indenture.]
["Trust Agreement" means the Amended and Restated Trust Agreement
dated as of __________, ____ among the Company, as Depositor, The Chase
Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as Delaware
Trustee, the Administrative Trustees named therein and the holders, from time to
time, of undivided beneficial interests in the assets of the Trust.]
["Underwriters" has the meaning specified in the fourth recital to
this Second Supplemental Indenture.]
["Underwriting Agreement" has the meaning specified in the fourth
recital to this Second Supplemental Indenture.]
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED
DEBENTURES
2.1 Designation and Principal Amount. There is hereby authorized one
series of Debentures, to be designated the "____% Junior Subordinated Debentures
due __________, 20__," and limited in aggregate principal amount to
$___________, which amount shall be as set forth in any written orders of the
Company for the authentication and delivery of Junior Subordinated Debentures
pursuant to Section 2.1 of the Base Indenture and Section 7.1(a) hereof.
2.2 Stated Maturity. The Stated Maturity of the Junior Subordinated
Debentures is __________, 20__, which may not be shortened or extended.
2.3 Form and Payment; Minimum Transfer Restriction.
(a) The Debentures shall be issued to the [holders] [Property Trustee]
in fully registered definitive form without coupons in minimum denominations of
$1,000 and integral multiples of $1,000 in excess thereof. Principal and
interest on the Junior Subordinated Debentures issued in definitive form will be
payable, the transfer of such Junior Subordinated Debentures will be registrable
and such Junior Subordinated Debentures will be exchangeable for Junior
Subordinated Debentures bearing identical terms and provisions at the principal
office of the Trustee; provided, however, that payment of interest may be made
at the option of the Company by check mailed to the registered holder at such
address as shall appear in the Register. [Notwithstanding the foregoing, so long
as the registered holder of any Junior Subordinated Debentures is the Property
Trustee, the payment of the principal of and interest (including Additional
interest and Additional Tax Sums, if any) on such Junior Subordinated Debentures
held by the Property Trustee will be
5
made at such place, or by wire transfer of immediately available funds to such
account, as may be designated by the Property Trustee.] The Register for the
Junior Subordinated Debentures shall be kept at the principal office of the
Trustee and the Trustee is hereby appointed registrar for the Junior
Subordinated Debentures.
(b) The Junior Subordinated Debentures may be transferred or exchanged
only in minimum denominations of $_______ and integral multiples of $_____ in
excess thereof, and any attempted transfer, sale or other disposition of Junior
Subordinated Debentures in a denomination of less than $_______ shall be deemed
to be void and of no legal effect whatsoever. Any such transferee shall be
deemed not to be the holder of such Junior Subordinated Debentures for any
purpose, including but not limited to the receipt of payments in respect of such
Junior Subordinated Debentures and such transferee shall be deemed to have no
interest whatsoever in such Junior Subordinated Debentures.
2.4 Exchange and Registration of Transfer of Junior Subordinated
Debentures; Restrictions on Transfers; Depositary. [If distributed to holders of
Capital Securities pursuant to Section 8.2 of the Trust Agreement, the Junior
Subordinated Debentures will be issued to such holders in the same form as the
Capital Securities that such Junior Subordinated Debentures replace in
accordance with the following procedures:]
(a) So long as Junior Subordinated Debentures are eligible for book-
entry settlement with the Depositary, or unless required by law, all Junior
Subordinated Debentures that are so eligible will be represented by one or more
Junior Subordinated Debentures in global form (a "Global Debenture") registered
in the name of the Depositary or the nominee of the Depositary. Except as
provided in Section 2.4(c) below, beneficial owners of a Global Debenture shall
not be entitled to have Definitive Debenture Certificates registered in their
names, will not receive or be entitled to receive physical delivery of
Definitive Debenture Certificates and will not be registered holders of such
Global Debentures.
(b) The transfer and exchange of beneficial interests in Global
Debentures shall be effected through the Depositary in accordance with the
Indenture and the procedures and standing instructions of the Depositary and the
Trustee shall make appropriate endorsements to reflect increases or decreases in
principal amounts of such Global Debentures.
(c) Notwithstanding any other provisions of the Indenture (other than
the provisions set forth in this Section 2.4(c)), a Global Debenture may not be
exchanged in whole or in part for Junior Subordinated Debentures registered, and
no transfer of a Global Debenture may be registered, in the name of any person
other than the Depositary or a nominee thereof unless (i) such Depositary (A)
has notified the Company that it is unwilling or unable to continue as
Depositary for such Global Debenture or (B) has ceased to be a clearing agency
registered as such under the Exchange Act and no successor Depositary has been
appointed by the Company within 90 days after its receipt of such notice or its
becoming aware of such ineligibility, (ii) there shall have occurred and be
continuing an Event of Default, or any event which after notice or lapse of time
6
or both would be an Event of Default under the Indenture, with respect to such
Debenture, or (iii) the Company, in its sole discretion, instructs the Trustee
to exchange such Global Debenture for a Junior Subordinated Debenture that is
not a Global Debenture (in which case such exchange shall be effected by the
Trustee).
The Depositary shall be a clearing agency registered under the Exchange
Act. The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Global Debentures. Initially, any Global
Debentures shall be registered in the name of Cede & Co., as the nominee of the
Depositary, and deposited with the Trustee as custodian for Cede & Co.
Definitive Junior Subordinated Debentures issued in exchange for all or a
part of a Global Debenture pursuant to this Section 2.4(c) shall be registered
in such names and in such authorized denominations as the Depositary, pursuant
to instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. Upon execution and authentication, the Trustee shall
deliver such definitive Junior Subordinated Debentures to the person in whose
names such definitive Junior Subordinated Debentures are so registered.
So long as Junior Subordinated Debentures are represented by one or more
Global Debentures, (i) the registrar for the Junior Subordinated Debentures and
the Trustee shall be entitled to deal with the clearing agency for all purposes
of the Indenture relating to such Global Debentures as the sole holder of the
Junior Subordinated Debentures evidenced by such Global Debentures and shall
have no obligations to the holders of beneficial interests in such Global
Debentures; and (ii) the rights of the holders of beneficial interests in such
Global Debentures shall be exercised only through the clearing agency and shall
be limited to those established by law and agreements between such holders and
the clearing agency and/or the participants in the clearing agency.
At such time as all interests in a Global Debenture have been redeemed,
exchanged, repurchased or canceled, such Global Debenture shall be, upon receipt
thereof, canceled by the Trustee in accordance with standing procedures and
instructions of the Depositary. At any time prior to such cancellation, if any
interest in a Global Debenture is exchanged for definitive Junior Subordinated
Debentures, prepaid by the Company pursuant to Article 3 or canceled, or
transferred for part of a Global Debenture, the principal amount of such Global
Debenture shall, in accordance with the standing procedures and instructions of
the Depositary be reduced or increased, as the case may be, and an endorsement
shall be made on such Global Debenture by, or at the direction of, the Trustee
to reflect such reduction or increase.
2.5 Interest.
(a) Each Junior Subordinated Debenture will bear interest at the rate
of ____% per annum (the "Coupon Rate") from __________, ____ until the principal
thereof becomes due and payable, and will bear interest on any overdue principal
at the Coupon Rate and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
Coupon Rate ("Additional Interest"), compounded semiannually, payable (subject
to the
7
provisions of Article 4) semiannually in arrears on the 1st day of [December]
and [June] of each year (each, an "Interest Payment Date"), commencing on
_________, ____ to the Person in whose name such Junior Subordinated Debenture
is registered, subject to certain exceptions, at the close of business on the
Record Date next preceding such Interest Payment Date. The "Record Date" for
payment of interest will be the Business Day next preceding the Interest Payment
Date, unless such Junior Subordinated Debenture is registered to a holder other
than the Property Trustee or a nominee of the Depositary, in which case the
Record Date for payment of interest will be the fifteenth day of the calendar
month next preceding the applicable Interest Payment Date or, if such fifteenth
day of the month is not a Business Day, then the Business Day next preceding
such day. [Until liquidation, if any, of the Trust, each Junior Subordinated
Debenture will be held in the name of the Property Trustee in trust for the
benefit of the holders of the Trust Securities.]
(b) The amount of interest payable for any period will be computed on
the basis of a 360-day year of twelve 30-day months. In the event that any date
on which interest is payable on the Junior Subordinated Debentures is not a
Business Day, then payment of interest payable on such date will be made on the
next succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), in each case with the same force and
effect as if made on the date such payment was originally payable.
(c) [The Company will also pay any Additional Tax Sums as additional
distributions on the Junior Subordinated Debentures if the Trust is required to
pay any additional taxes, duties or other governmental charges as a result of a
Tax Event.]
ARTICLE III
[PREPAYMENT OF THE JUNIOR SUBORDINATED DEBENTURES
3.1 Tax Event or Investment Company Event Prepayment. If a Tax Event or
Investment Company Event shall occur and be continuing, the Company may, at its
option, prior to the Initial Optional Prepayment Date (as defined herein)
notwithstanding Section 3.2(a) but subject to Section 3.2(b), prepay the Junior
Subordinated Debentures in whole (but not in part) within 90 days of the
occurrence of such Tax Event or Investment Company Event at a prepayment price
(the "Event Prepayment Price") equal to the greater of (i) 100% of the principal
amount of such Junior Subordinated Debentures or (ii) as determined by the
Quotation Agent, an amount equal to the sum of the present values of the
Optional Prepayment Price (as defined below) that would be payable on the
Initial Optional Prepayment Date together with the present values of scheduled
payments of interest from the prepayment date to the Initial Optional Prepayment
Date (such period, the "Term To Initial Optional Prepayment Date"), in each
case, discounted to the prepayment date on a semi-annual basis (consisting of a
360-day year of twelve 30-day months) at the Adjusted Treasury Rate, plus, in
each case, accrued interest thereon to but excluding the prepayment date. The
Company shall give the Trustee notice of the amount of the Event Prepayment
Price promptly after the calculation thereof.
8
3.2 Optional Prepayment by Company.
(a) Subject to the provisions of this Article Three, the Company shall
have the right to prepay the Junior Subordinated Debentures, in whole or in
part, at any time on or after ________, 20__ (the "Initial Optional Prepayment
Date"), at the optional prepayment prices set forth below (expressed as
percentages of outstanding principal amount of the Junior Subordinated
Debentures to be prepaid), plus, in each case, accrued and unpaid interest
thereon to the applicable date of prepayment (the "Optional Prepayment Price")
if prepaid during the 12-month period beginning on __________ of the years
indicated below.
Year Percentage
---- ----------
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ ........................... 10_.___%
20__ and thereafter............. 100.000%
If the Junior Subordinated Debentures are only partially prepaid pursuant
to this Section 3.2, the Junior Subordinated Debentures will be prepaid pro rata
--- ----
or by lot or by any other method utilized by the Trustee. The Optional
Prepayment Price shall be paid prior to 2:00 p.m., New York City time, on the
date of such prepayment, provided that the Company shall deposit with the
Trustee an amount sufficient to pay the Optional Prepayment Price by 11:00 a.m.,
New York City time, on the date such Optional Prepayment Price is to be paid.
(b) Notwithstanding the first sentence of Section 3.2, in the event
that a Tax Event or an Investment Company Event shall have occurred and be
continuing, the Junior Subordinated Debentures thereafter will be subject to
optional prepayment, in whole only, but not in part, on or after the Initial
Optional Prepayment Date, at the optional prepayment prices set forth in this
Section 3.2 and otherwise in accordance with this Article III.
3.3 Notice of Prepayment. Subject to Article Three of the Base Indenture,
notice of any prepayment pursuant to this Article Three will be mailed at least
20 days but not more than 60 days before the prepayment date to each holder of
Junior Subordinated Debentures to be prepaid at such holder's registered
address. Unless the Company defaults in payment of the Event Prepayment Price,
9
on and after the prepayment date interest shall cease to accrue on such Junior
Subordinated Debentures called for prepayment.]
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
4.1 Extension of Interest Payment Period. So long no Event of Default
under Section 6.1 of the Base Indenture has occurred and is continuing, the
Company shall have the right, subject to the provisions of Section 2.10 of the
Base Indenture, at any time during the term of the Junior Subordinated
Debentures, from time to time to defer the payment of interest by extending the
interest payment period of such Junior Subordinated Debentures for a period not
exceeding 10 consecutive semi-annual periods (an "Extension Period"), during
which Extension Period the Company shall have the right to make partial payments
of interest on any Interest Payment Date. No Extension Period shall end on a
date other than an Interest Payment Date or extend beyond the Stated Maturity of
the Junior Subordinated Debentures. To the extent permitted by applicable law,
interest, the payment of which has been deferred because of an Extension Period
imposed pursuant to this Section 4.1, will bear Additional Interest compounded
semi-annually. At the end of the Extension Period, the Company shall pay all
interest then accrued and unpaid on the Junior Subordinated Debentures,
including any Additional Interest and Additional Tax Sums, if applicable, to the
holders of the Junior Subordinated Debentures in whose names the Junior
Subordinated Debentures are registered in the Register on the first Record Date
preceding the end of the Extension Period. Before the termination of any
Extension Period, the Company may further extend such Extension Period, provided
that such period together with all such further extensions thereof shall not
exceed 10 consecutive semi-annual periods, or extend beyond the Stated Maturity.
At any time following the termination of any Extension Period and upon the
payment of any accrued and unpaid Additional Interest and Additional Tax Sums,
if applicable, then due, the Company may elect to begin a new Extension Period,
subject to the foregoing requirements. No interest shall be due and payable
during an Extension Period, except at the end thereof.
During any such Extension Period, the Company shall not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's Capital Stock or (ii)
make any payment of principal of or interest on or repay, repurchase or redeem
any debt securities of the Company that rank on a parity with or junior to this
Debenture or make any guarantee payments with respect to any [DRI Guarantee or
other] guarantee by the Company of the debt securities of any Subsidiary of the
Company that by its terms ranks on a parity with or junior to this Debenture
(other than (a) dividends or distributions in Common Stock, (b) any declaration
of a dividend in connection with the implementation of a Rights Plan, the
issuance of any Capital Stock or any class or series of preferred stock of the
Company under any Rights Plan or the redemption or repurchase of any rights
distributed pursuant to a Rights Plan, [(c) payments under any DRI Guarantee
relating to the Preferred Securities issued by the DRI Trust holding the Junior
Subordinated Debentures,] and (d) purchases of Common Stock related to the
10
issuance of Common Stock or rights under any of the Company's benefit plans for
its directors, officers, employees, consultants or advisors).
4.2 Notice of Extension.
(a) [If the Property Trustee is the only registered holder of the
Junior Subordinated Debentures at the time the Company elects to begin or extend
an Extension Period, the Company shall give written notice to the Property
Trustee, the Administrative Trustees and the Trustee of its election to begin or
extend any Extension Period at least five Business Days prior to the earlier of
(i) the next succeeding date on which Distributions on the Capital Securities
issued by the Trust would have been payable but for the election to begin or
extend such Extension Period or (ii) subject to applicable principles of federal
securities law, the date the Administrative Trustees are required to give notice
to any securities exchange or other applicable self-regulatory organization or
to holders of such Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than five Business Days
prior to such record date. An Administrative Trustee shall give notice of the
Company's election to begin or extend an Extension Period to the holders of such
Capital Securities.]
(b) [If the Property Trustee is not the only holder of the Junior
Subordinated Debentures at the time the Company elects to begin or extend an
Extension Period,] the Company shall give the holders of the Junior Subordinated
Debentures, the Administrative Trustees and the Trustee written notice of its
election to begin or extend such Extension Period at least 10 Business Days
prior to the earlier of (i) the next succeeding Interest Payment Date or (ii)
subject to applicable principles of federal securities law, the date the Company
is required to give notice of the record or payment date of such interest
payment to any applicable self-regulatory organization or to holders of the
Junior Subordinated Debentures.
(c) The semi-annual period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 4.2 shall be counted as one of the 10
consecutive semi-annual periods permitted in the maximum Extension Period
permitted under Section 4.1.
ARTICLE V
EXPENSES
5.1 Payment of Expenses. In connection with the offering, sale and
issuance of the Junior Subordinated Debentures [to the Property Trustee and in
connection with the offering, sale and issuance of the Trust Securities by the
Trust], the Company, in its capacity as borrower with respect to the Junior
Subordinated Debentures, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Junior Subordinated Debentures, including [commissions to the
Underwriters payable pursuant to
11
the Underwriting Agreement and] compensation of the Trustee under the Indenture
in accordance with the provisions of Section 7.6 of the Base Indenture;
(b) [pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the Trust, the
fees and expenses of the Property Trustee and the Delaware Trustee, the costs
and expenses relating to the operation of the Trust, including without
limitation, costs and expenses of accountants, attorneys, statistical or
bookkeeping services, expenses for printing and engraving and computing or
accounting equipment, paying agent(s), registrar(s), transfer agent(s),
duplicating, travel and telephone and other telecommunications expenses and
costs and expenses incurred in connection with the acquisition, financing, and
disposition of Trust assets);]
(c) [pay all costs and expenses related to the enforcement by the
Property Trustee of the rights of the registered holders of the Capital
Securities;
(d) be primarily liable for any indemnification obligations arising
with respect to the Trust Agreement and the Underwriting Agreement; and
(e) pay any and all taxes and all liabilities, costs and expenses with
respect to such taxes of the Trust (but not including withholding taxes imposed
on holders of Capital Securities or Common Securities of the Trust).]
5.2 Payment Upon Resignation or Removal. Upon termination of this Second
Supplemental Indenture or the Base Indenture or the removal or resignation of
the Trustee pursuant to Section 7.10 of the Base Indenture, the Company shall
pay to the Trustee all amounts owed to it under Section 7.6 of the Base
Indenture accrued to the date of such termination, removal or resignation. [Upon
termination of the Trust Agreement or the removal or resignation of the Delaware
Trustee or the Property Trustee, as the case may be, pursuant to Section 6.6 of
the Trust Agreement, the Company shall pay to the Delaware Trustee or the
Property Trustee, and their respective counsel, as the case may be, all amounts
owed to them under Section 4.2 of the Trust Agreement accrued to the date of
such termination, removal or resignation.]
ARTICLE VI
FORM OF JUNIOR SUBORDINATED DEBENTURE
6.1 Form of Junior Subordinated Debenture. The Junior Subordinated
Debentures and the Trustee's Certificate of Authentication to be endorsed
thereon are to be substantially in the form attached hereto as Exhibit A.
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ARTICLE VII
ORIGINAL ISSUE OF JUNIOR SUBORDINATED DEBENTURES
7.1 Original issue of Junior Subordinated Debentures. Junior Subordinated
Debentures in the aggregate principal amount of up to $___________ may be
executed by the Company and delivered to the Trustee for authentication by it,
and the Trustee shall thereupon authenticate and deliver said Junior
Subordinated Debentures to or upon the written order of the Company, signed by
its Chairman of the Board, any Vice Chairman of the Board, the Chief Executive
Officer, the President, or any Vice President (whether or not designated by a
number or word or words added before or after the title Vice President) and by
its Treasurer, an Assistant Treasurer, the Controller, its Corporate Secretary
or an Assistant Corporate Secretary, without any further corporate action by the
Company as follows:$___________ aggregate principal amount of Junior
Subordinated Debentures to be originally issued on the Closing Date [(as defined
in the Underwriting Agreement)].
ARTICLE VIII
MISCELLANEOUS
8.1 Ratification of Indenture; Second Supplemental Indenture Controls.
The Indenture, as supplemented by this Second Supplemental Indenture, is in all
respects ratified and confirmed, and this Second Supplemental Indenture shall be
deemed part of the Indenture in the manner and to the extent herein and therein
provided. The provisions of this Second Supplemental Indenture shall supersede
the provisions of the Indenture to the extent the Indenture is inconsistent
herewith.
8.2 Trustee Not Responsible for Recitals. The recitals herein contained
are made by the Company and not by the Trustee, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee makes no representation
as to the validity or sufficiency of this Second Supplemental Indenture.
8.3 Governing Law. This Second Supplemental Indenture and each Junior
Subordinated Debenture shall be deemed to be a contract made under the internal
laws of the State of New York, and for all purposes shall be governed by and
construed in accordance with the laws of said State, without regard to the
conflicts of law principles thereof.
8.4 Separability. In case any one or more of the provisions contained in
this Second Supplemental Indenture or in the Junior Subordinated Debentures
shall for any reason be held to be invalid, illegal or unenforceable in any
respect, such invalidity, illegality or unenforceability shall
13
not affect any other provisions of this Second Supplemental Indenture or of the
Junior Subordinated Debentures, but this Second Supplemental Indenture and the
Junior Subordinated Debentures shall be construed as if such invalid or illegal
or unenforceable provision had never been contained herein or therein.
8.5 Counterparts. This Second Supplemental Indenture may be executed in
any number of counterparts each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
14
IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental
Indenture to be duly executed as of the date first above written.
DOMINION RESOURCES, INC.
By: ___________________________________
Name:
Title:
THE CHASE MANHATTAN BANK, as Trustee
By: ___________________________________
Name:
Title:
15
EXHIBIT A
(FORM OF FACE OF JUNIOR SUBORDINATED DEBENTURE)
[If the Debenture is to be a Global Debenture, insert the following--THIS
DEBENTURE IS A GLOBAL DEBENTURE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A
DEPOSITARY. THIS DEBENTURE IS EXCHANGEABLE FOR JUNIOR SUBORDINATED DEBENTURES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
DEBENTURE (OTHER THAN A TRANSFER OF THIS DEBENTURE AS A WHOLE BY THE DEPOSITARY
TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN
SUCH LIMITED CIRCUMSTANCES.
UNLESS THIS DEBENTURE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY DEBENTURE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.]
THE DEBENTURES EVIDENCED HEREBY WILL BE ISSUED, AND MAY BE TRANSFERRED,
ONLY IN BLOCKS HAVING A PRINCIPAL AMOUNT OF NOT LESS THAN $_______. ANY
TRANSFER, SALE OR OTHER DISPOSITION OF SUCH DEBENTURES IN A BLOCK HAVING A
PRINCIPAL AMOUNT OF LESS THAN $_______ SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE
HOLDER OF SUCH DEBENTURES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE
RECEIPT OF PAYMENTS IN RESPECT OF SUCH DEBENTURES, AND SUCH TRANSFEREE SHALL BE
DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH DEBENTURES.
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NUMBER ____ [up to]/1/ $___________
DOMINION RESOURCES, INC. ___% JUNIOR SUBORDINATED
DEBENTURE DUE __________, 20__
Dated:__________________ CUSIP NO: ___________________]
Registered Holder:
DOMINION RESOURCES, INC., a corporation duly organized and existing under
the laws of the Commonwealth of Virginia (herein referred to as the "Company,"
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to the Registered
Holder named above, the principal sum [of ___________________________
Dollars($__________))]/2/ [specified in the Schedule annexed hereto]/3/ on
__________, 20__, in such coin or currency of the United States of America as at
the time of payment is legal tender for the payment of public and private debt.
The Company further promises to pay to the registered Holder hereof as
hereinafter provided (a) interest on said principal sum (subject to deferral as
set forth herein) at the rate per annum specified in the title of this debenture
(the "Debenture"), in like coin or currency, semiannually in arrears on the 1st
day of June and December (each an "Interest Payment Date") commencing ______,
20__, from the Interest Payment Date next preceding the date hereof to which
interest has been paid or duly provided for (unless (i) no interest has yet been
paid or duly provided for on this Debenture, in which case from __________,
____, or (ii) the date hereof is before an Interest Payment Date but after the
related Record Date (as defined below), in which case from such following
Interest Payment Date; provided, however, that if the Company shall default in
payment of the interest due on such following Interest Payment Date, then from
the next preceding Interest Payment Date to which interest has been paid or duly
provided for), until the principal hereof is paid or duly provided for, plus (b)
Additional Interest, as defined in the Indenture, to the extent permitted by
applicable law, on any interest payment that is not made on the applicable
Interest Payment Date, which shall accrue at the rate per annum specified in the
title of this Debenture, compounded semiannually.
The interest so payable will, subject to certain exceptions provided in the
Indenture hereinafter referred to, be paid to the person in whose name this
Debenture is registered at the close of business on the Record Date next
preceding such Interest Payment Date. The Record Date shall
----------------------------
/1/ Insert in Global Debentures.
/2/ Insert in all Junior Subordinated Debentures other than Global Debentures.
/3/ Insert in Global Debentures.
A-2
be the Business Day next preceding the Interest Payment Date, unless this
Debenture is registered to a holder other than [the Property Trustee] or a
nominee of The Depository Trust Company, in which case the Record Date will be
the fifteenth day of the calendar month next preceding such Interest Payment
Date or, if such fifteenth day is not a Business Day, then the Business Day next
preceding such day. This Debenture may be presented for payment of principal and
interest at the principal corporate trust office of The Chase Manhattan Bank, as
paying agent for the Company, maintained for that purpose in the Borough of
Manhattan, The City of New York; provided, however, that payment of interest may
be made at the option of the Company (i) by check mailed to such address of the
person entitled thereto as the address shall appear on the Register of the
Debentures or (ii) by transfer to an account maintained by the Person entitled
thereto as specified in the Register, provided that proper transfer instructions
have been received by the Record Date. Interest on the Debenture will be
computed on the basis of a 360-day year of twelve 30-day months.
So long as no Event of Default has occurred and is continuing, the Company
shall have the right at any time during the term of this Debenture from time to
time to defer payment of interest on this Debenture, for up to 10 consecutive
semiannual interest payment periods with respect to each deferral period (each
an "Extension Period"), during which Extension Periods the Company shall have
the right to make partial payments of interest on any Interest Payment Date;
provided, however, that no Extension Period shall end on a date other than an
Interest Payment Date or extend beyond __________, 20__. At the end of each
Extension Period, the Company shall pay all interest then accrued and unpaid
(together with any Additional Interest thereon to the extent permitted by
applicable law, and Additional Tax Sums, if applicable). During any such
Extension Period, the Company shall not, and shall cause any Subsidiary of the
Company not to, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Company's Capital Stock (which includes Common Stock and preferred stock) or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Company that rank on a
parity with or junior to this Debenture or make any guarantee payments with
respect to any [DRI Guarantee or other] guarantee by the Company of the debt
securities of any Subsidiary of the Company that by its terms ranks on a parity
with or junior to this Debenture (other than (a) dividends or distributions in
Common Stock, (b) any declaration of a dividend in connection with the
implementation of a Rights Plan, the issuance of any Capital Stock or any class
or series of preferred stock of the Company under any Rights Plan or the
redemption or repurchase of any rights distributed pursuant to a Rights Plan,
[(c) payments under any DRI Guarantee relating to the Preferred Securities
issued by the DRI Trust holding this Debenture,] and (d) purchases of Common
Stock related to the issuance of Common Stock or rights under any of the
Company's benefit plans for its directors, officers, employees, consultants or
advisors). Prior to the termination of any such Extension Period, the Company
may further extend such Extension Period; provided, however, that no Extension
Period shall exceed 10 consecutive semiannual periods or extend beyond
__________, 20__. At any time following the termination of any Extension Period
and the payment of all accrued and unpaid interest (together with any Additional
Interest and Additional Tax Sums, if applicable) then due, the Company may elect
to begin a new Extension Period, subject to the above requirements. No interest
shall be due and
A-3
payable during an Extension Period except at the end thereof. [If the Property
Trustee is the only registered holder of the Debentures of this series, the
Company shall give written notice to the Property Trustee and the Trustee of its
election to begin or extend any Extension Period at least five Business Days
prior to the earlier of (i) the next succeeding date on which Distributions on
the Capital Securities issued by the relevant DRI Trust would have been payable
but for the election to begin or extend such Extension Period or (ii) the date
the Administrative Trustees are required to give notice to any securities
exchange or other applicable self-regulatory organization or to holders of such
Capital Securities of the record date or the date such Distributions are
payable, but in any event not less than five Business Days prior to such record
date.] [An Administrative Trustee shall give notice of the Company's election to
begin or extend an Extension Period to the holders of such Capital Securities.]
[If the Property Trustee is not the only holder of the Debentures of this series
at the time the Company elects to begin or extend an Extension Period,] the
Company shall give the holders of the Debentures of this series and the Trustee
written notice of its election to begin or extend such Extension Period at least
10 Business Days prior to the earlier of (i) the next succeeding Interest
Payment Date or (ii) the date the Company is required to give notice of the
record or payment date of such interest payment to any applicable self-
regulatory organization or to holders of the Debentures of this series.
This Debenture is issued pursuant to an Indenture, dated as of December 1,
1997, between the Company, as issuer, and The Chase Manhattan Bank, a New York
banking corporation, as trustee, as supplemented by a First Supplemental
Indenture dated as of December 1, 1997 and a Second Supplemental Indenture dated
as of ________, ____ (as further supplemented or amended from time to time, the
"Indenture"). Reference is made to the Indenture for a description of the
respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the Holders (the word "Holder" or
"Holders" meaning the registered holder or registered holders) of the
Debentures. Capitalized terms used herein but not defined herein shall have the
respective meanings assigned thereto in the Indenture. By acceptance of this
Debenture, the Holder hereof agrees to be bound by the provisions of the
Indenture.
The Debentures of this series are limited to the aggregate principal amount
of ___________ ______________________________ Dollars ($___________).
The Debentures evidenced by this Certificate may be transferred or
exchanged only in minimum denominations of $_______ and integral multiples of
$_____ in excess thereof, and any attempted transfer, sale or other disposition
of Debentures in a denomination of less than $_______ shall be deemed to be void
and of no legal effect whatsoever.
The indebtedness of the Company evidenced by this Debenture, including the
principal hereof and interest hereon, is, to the extent and in the manner set
forth in the Indenture, subordinate and junior in right of payment to the
Company's obligations to Holders of Senior Indebtedness of the Company and each
Holder of this Debenture, by acceptance hereof, agrees to and shall be bound by
such provisions of the Indenture and all other provisions of the Indenture.
A-4
This Debenture shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been signed by or on
behalf of the Trustee under the Indenture.
IN WITNESS WHEREOF, DOMINION RESOURCES, INC. has caused this instrument to
be signed, manually or in facsimile, by its Chairman of the Board, or its Chief
Executive Officer, or its President, or any Vice President and by its Treasurer
or an Assistant Treasurer or its Controller or its Corporate Secretary or an
Assistant Corporate Secretary under the corporate seal of Dominion Resources,
Inc.
DOMINION RESOURCES, INC.
By: ___________________________________
Name:
Title:
[SEAL]
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities, of the series designated herein, referred to
in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK, as Trustee
By: ____________________________
Authorized Officer
A-5
REVERSE OF DEBENTURE
[As provided in and subject to the provisions in the Indenture, the Company
shall have the right redeem this Debenture, in whole or in part, at any time on
or after __________, 20__, at the Optional Prepayment Prices set forth below
(expressed as percentages of the principal amount to be prepaid) plus accrued
and unpaid interest thereon to the applicable date of prepayment if prepaid
during the 12-month period beginning on __________, of the years indicated
below:
Year Percentage
---- ----------
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ ......................... 10_.___%
20__ and thereafter........... 100.000%
In addition, upon the occurrence and during the continuation of a Tax Event
or Investment Company Event, the Company may, at its option, at any time, prior
to the Initial Optional Prepayment Date, within 90 days of the occurrence of
such Tax Event or Investment Company Event, redeem this Debenture in whole (but
not in part) at a prepayment price (the "Event Prepayment Price") equal to the
greater of (i) 100% of the principal amount hereof or (ii) as determined by a
Quotation Agent, the sum of the present values of the Optional Prepayment Price
that would be payable on the Initial Optional Prepayment Date, together with the
present values of scheduled payments of interest from the prepayment date to the
Initial Optional Prepayment Date, in each case discounted to the prepayment date
on a semi-annual basis at the Adjusted Treasury Rate, plus, in each case,
accrued interest thereon to but excluding the date of prepayment.]
In the case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Debentures may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
Any consent or waiver by the Holder of this Debenture given as provided in
the Indenture (unless effectively revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future Holders of this
Debenture and of any Debenture issued in exchange, registration of transfer, or
otherwise in lieu hereof irrespective of whether any notation of such
A-6
consent or waiver is made upon this Debenture or such other Debentures. No
reference herein to the Indenture and no provision of this Debenture or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of and interest on this Debenture, at
the places, at the respective times, at the rate and in the coin or currency
herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Debenture may be registered on the Register of the
Debentures of this series upon surrender of this Debenture for registration of
transfer at the offices maintained by the Company or its agent for such purpose,
duly endorsed by the Holder hereof or his attorney duly authorized in writing,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities registrar duly executed by the Holder hereof or his
attorney duly authorized in writing, but without payment of any charge other
than a sum sufficient to reimburse the Company for any tax or other governmental
charge incident thereto. Upon any such registration of transfer, a new
Debenture or Debentures of authorized denomination or denominations for the same
aggregate principal amount will be issued to the transferee in exchange herefor.
Prior to due presentment for registration of transfer of this Debenture,
the Company, the Trustee, and any agent of the Company or the Trustee may deem
and treat the person in whose name this Debenture shall be registered upon the
Register of the Debentures of this series as the absolute owner of this
Debenture (whether or not this Debenture shall be overdue and notwithstanding
any notation of ownership or other writing hereon) for the purpose of receiving
payment of or on account of the principal hereof and, subject to the provisions
on the face hereof, interest due hereon and for all other purposes; and neither
the Company nor the Trustee nor any such agent shall be affected by any notice
to the contrary.
No recourse shall be had for the payment of the principal of or interest on
this Debenture, or for any claim based hereon or otherwise in respect hereof, or
based on or in respect of the Indenture or any indenture supplemental thereto,
against any stockholder, officer, director or employee, as such, past, present
or future, of the Company or of any successor corporation, either directly or
through the Company, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as a part of the consideration for
the issue hereof, expressly waived and released.
The Company and, by acceptance of this Debenture or a beneficial interest
in this Debenture, each holder hereof and any person acquiring a beneficial
interest herein, agree that for United States federal, state and local tax
purposes it is intended that this Debenture constitute indebtedness.
This Debenture shall be deemed to be a contract made under the laws of the
State of New York (without regard to conflicts of laws principles thereof) and
for all purposes shall be governed by, and construed in accordance with, the
laws of said State.
A-7
