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Exhibit 4(a)
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THE CLEVELAND ELECTRIC ILLUMINATING
COMPANY
TO
THE CHASE MANHATTAN BANK,
as Trustee.
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SEVENTY-SIXTH SUPPLEMENTAL INDENTURE
DATED OCTOBER 15, 1997
FIRST MORTGAGE BONDS, 7.43% SERIES DUE 2009-D
FIRST MORTGAGE BONDS, 7.88% SERIES DUE 2017-B
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THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
SEVENTY-SIXTH SUPPLEMENTAL INDENTURE
DATED OCTOBER 15, 1997
TABLE OF CONTENTS
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PARTIES............................................................. 1
RECITALS:
Indenture and Supplemental Indentures.......................... 1
First Mortgage Bonds outstanding............................... 1
Authorization by Indenture of issue of additional Bonds........ 2
Pledge Bonds................................................... 2
Purpose of Seventy-Sixth Supplemental Indenture................ 2
Authorization of Seventy-Sixth Supplemental Indenture.......... 2
Compliance with conditions to making of Seventy-Sixth
Supplemental Indenture....................................... 2
ARTICLE I -- CONFIRMATION OF 1940 MORTGAGE AND SUPPLEMENTAL
INDENTURES......................................... 3
ARTICLE II -- CREATION, PROVISIONS, REDEMPTION, PRINCIPAL
AMOUNT AND FORM OF PLEDGE BONDS DUE 2009........... 3
Section 1 -- Creation and designation of Bonds and compliance
with Indenture..................................... 3
Section 2 -- Registered Bonds and denominations................. 4
Section 3 -- Date of Bonds, maturity date, interest rate,
accrual date, payment dates, Record Date and place
of payments........................................ 4
Section 4 -- Transfer and exchange of Bonds..................... 5
Section 5 -- Redemption of Bonds................................ 6
Section 6 -- Notice of redemption............................... 6
Section 7 -- Purchase, prepayment or payment of principal of
Notes deemed to be corresponding payment of
Bonds.............................................. 6
Section 8 -- Redemption of Bonds in an "Event of Default"
under the Note Indenture........................... 6
Section 9 -- Redemption of Bonds pursuant to the Note
Indenture.......................................... 7
Section 10 -- Notice of Redemption under Sections 5 through 9
of Article II of the Supplemental Indenture........ 7
Section 11 -- Payment of interest or premium on Notes deemed
to be corresponding payment on Bonds............... 8
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Section 12 -- Surrender of Bonds purchased or otherwise
acquired........................................... 8
Section 13 -- Surrender of Bonds in the event of payment in
full or partial payment thereof and issuance of new
Bonds for the unpaid balance....................... 8
Section 14 -- Notation of payments on Bonds before transfer...... 8
Section 15 -- Principal amount of Bonds which may be
authenticated and delivered........................ 9
Section 16 -- Form of Fully Registered Pledge Bonds.............. 9
Form of Trustee's Certificate of Authentication.... 14
ARTICLE III -- CREATION, PROVISIONS, REDEMPTION, PRINCIPAL
AMOUNT AND FORM OF PLEDGE BONDS DUE 2017........... 15
Section 1 -- Creation and designation of Bonds and compliance
with Indenture..................................... 15
Section 2 -- Registered Bonds and denominations................. 15
Section 3 -- Date of Bonds, maturity date, interest rate,
accrual date, payment dates, Record Date and place
of payments........................................ 15
Section 4 -- Transfer and exchange of Bonds..................... 16
Section 5 -- Redemption of Bonds................................ 17
Section 6 -- Notice of redemption............................... 17
Section 7 -- Purchase, prepayment or payment of principal of
Notes deemed to be corresponding payment of
Bonds.............................................. 17
Section 8 -- Redemption of Bonds in an "Event of Default"
under the Note Indenture........................... 18
Section 9 -- Redemption of Bonds pursuant to the Note
Indenture.......................................... 18
Section 10 -- Notice of Redemption under Sections 5 through 9
of Article III of the Supplemental Indenture....... 19
Section 11 -- Payment of interest or premium on Notes deemed
to be corresponding payment on Bonds............... 19
Section 12 -- Surrender of Bonds purchased or otherwise
acquired........................................... 19
Section 13 -- Surrender of Bonds in the event of payment in
full or partial payment thereof and issuance of new
Bonds for the unpaid balance.................... 19
Section 14 -- Notation of payments on Bonds before transfer...... 20
Section 15 -- Principal amount of Bonds which may be
authenticated and delivered........................ 20
Section 16 -- Form of Fully Registered Pledge Bonds.............. 20
Form of Trustee's Certificate of Authentication.... 25
ARTICLE IV -- THE TRUSTEE........................................ 26
Section 1 -- Acceptance by Trustee.............................. 26
Section 2 -- Responsibility of Trustee.......................... 26
Section 3 -- Reliance by Trustee upon certain demands,
certificates and opinions.......................... 26
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Section 4 -- Records kept and indemnity given by agency of
the Company........................................ 26
Section 5 -- Certain advices to the Company..................... 27
ARTICLE V -- MISCELLANEOUS PROVISIONS........................... 27
EXECUTION........................................................... 27
COMPANY'S ACKNOWLEDGMENT............................................ S-1
TRUSTEE'S ACKNOWLEDGMENT............................................ S-1
RECORDING AND FILING DATA........................................... R-1
* The Table of Contents, the page headings and the recording data are not
part of the Seventy-Sixth Supplemental Indenture as executed
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SEVENTY-SIXTH SUPPLEMENTAL INDENTURE, dated October 15, 1997, made by and
between THE CLEVELAND ELECTRIC ILLUMINATING COMPANY, a corporation organized and
existing under the laws of the State of Ohio (the "Company"), and THE CHASE
MANHATTAN BANK, successor by merger to The Chase Manhattan Bank (National
Association), which in turn was successor to Xxxxxx Guaranty Trust Company of
New York, formerly Guaranty Trust Company of New York), a corporation organized
and existing under the laws of the State of New York (the "Trustee"), as Trustee
under the Mortgage and Deed of Trust dated July 1, 1940, hereinafter mentioned:
RECITALS
In order to secure First Mortgage Bonds of the Company ("Bonds"), the
Company has heretofore executed and delivered to the Trustee the Mortgage and
Deed of Trust dated July 1, 1940 (the "1940 Mortgage") and seventy-five
Supplemental Indentures thereto dated, respectively, July 1, 1940, August 18,
1944, December 1, 1947, September 1, 1950, June 1, 1951, May 1, 1954, March 1,
1958, April 1, 1959, December 20, 1967, January 15, 1969, November 1, 1969, June
1, 1970, November 15, 1970, May 1, 1974, April 15, 1975, April 16, 1975, May 28,
1975, February 1, 1976, November 23, 1976, July 26, 1977, September 27, 1977,
May 1, 1978, September 1, 1979, April 1, 1980, April 15, 1980, May 28, 1980,
June 9, 1980, December 1, 1980, July 28, 1981, August 1, 1981, March 1, 1982,
July 15, 1982, September 1, 1982, November 1, 1982, November 15, 1982, May 24,
1983, May 1, 1984, May 23, 1984, June 27, 1984, September 4, 1984, November 14,
1984, November 15, 1984, April 15, 1985, May 28, 1985, August 1, 1985, September
1, 1985, November 1, 1985, April 15, 1986, May 14, 1986, May 15, 1986, February
25, 1987, October 15, 1987, February 24, 1988, September 15, 1988, May 15, 1989,
June 13, 1989, October 15, 1989, January 1, 1990, June 1, 1990, August 1, 1990,
May 1, 1991, May 1, 1992, July 31, 1992, January 1, 1993, February 1, 1993, May
20, 1993, June 1, 1993, September 15, 1994, May 1, 1995, May 2, 1995, June 1,
1995, July 15, 1995, August 1, 1995, June 15, 1997 and August 1, 1997; and
The 1940 Mortgage, as supplemented and modified by said Supplemental
Indentures and by this Seventy-Sixth Supplemental Indenture, will be hereinafter
collectively referred to as the "Indenture" and this Seventy-Sixth Supplemental
Indenture will be hereinafter referred to as "this Supplemental Indenture"; and
Pursuant to the provisions of the Indenture, the Company has issued 124
series of Bonds in the aggregate principal amount of $6,296,962,000, of which 84
series in the aggregate principal amount of $2,395,779,000 are no longer
outstanding; and
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The Indenture provides among other things that the Company, from time to
time, in addition to the Bonds authorized to be executed, authenticated and
delivered pursuant to other provisions therein, may execute and deliver
additional Bonds to the Trustee and the Trustee shall thereupon authenticate and
deliver such Bonds to or upon the order of the Company; and
The Company has determined to create pursuant to the provisions of the
Indenture two new series of first mortgage bonds (collectively, the "Pledge
Bonds"), to be pledged as security for the payment of principal of and interest
on certain notes (as hereinafter defined), with such Pledge Bonds to have the
denominations, rate of interest, date of maturity, redemption provisions and
other provisions and agreements in respect thereof as in this Supplemental
Indenture set forth; and
The Pledge Bonds are to be limited in aggregate principal amount to $450
million and are to be delivered to The Chase Manhattan Bank, as trustee
(hereinafter called the "Note Trustee") pursuant to a certain indenture dated as
of October 24, 1997, between the Company and the Note Trustee, as amended and
supplemented from time to time (hereinafter called the "Note Indenture") under
which the Note Trustee will hold the Pledge Bonds as security for the payment of
principal of and interest on two new series of notes to be issued in a private
placement and two new series of notes that may be exchanged therefor pursuant to
a registered exchange offer (hereinafter collectively called the "Notes"); and
The Company, in the exercise of the powers and authority conferred upon and
reserved to it under the provisions of the Indenture, and pursuant to
appropriate resolutions of its Board of Directors, has duly resolved and
determined to make, execute and deliver to the Trustee this Supplemental
Indenture in the form hereof for the purposes herein provided; and
All conditions and requirements necessary to make this Supplemental
Indenture a valid, binding and legal instrument have been done, performed and
fulfilled and the execution and delivery hereof have been in all respects duly
authorized.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
That The Cleveland Electric Illuminating Company, in consideration of the
premises and of the mutual covenants herein contained and of the sum of One
Dollar ($1.00) to it duly paid by the Trustee at or before the ensealing and
delivery of these presents and for other valuable considerations, the receipt
whereof is hereby acknowledged, hereby covenants and agrees to and with the
Trustee and its succes-
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sors in the Trust under the Indenture, for the benefit of those who shall hold
the Bonds and coupons, if any, issued and to be issued thereunder and under this
Supplemental Indenture as hereinafter provided, as follows:
ARTICLE I
CONFIRMATION OF 1940 MORTGAGE AND
SUPPLEMENTAL INDENTURES
The 1940 Mortgage (as modified in Article V of the Supplemental Indenture
dated December 1, 1947, Article V of the Supplemental Indenture dated May 1,
1954, Article V of the Supplemental Indenture dated March 1, 1958, Article V of
the Supplemental Indenture dated January 15, 1969, Article III of the
Supplemental Indenture dated November 23, 1976 and Article III of the
Supplemental Indenture dated April 15, 1985) and the Supplemental Indentures
dated July 1, 1940, August 18, 1944, December 1, 1947, September 1, 1950, June
1, 1951, May 1, 1954, March 1, 1958, April 1, 1959, December 20, 1967, January
15, 1969, November 1, 1969, June 1, 1970, November 15, 1970, May 1, 1974, April
15, 1975, April 16, 1975, May 28, 1975, February 1, 1976, November 23, 1976,
July 26, 1977, September 27, 1977, May 1, 1978, September 1, 1979, April 1,
1980, April 15, 1980, May 28, 1980, June 9, 1980, December 1, 1980, July 28,
1981, August 1, 1981, March 1, 1982, July 15, 1982, September 1, 1982, November
1, 1982, November 15, 1982, May 24, 1983, May 1, 1984, May 23, 1984, June 27,
1984, September 4, 1984, November 14, 1984, November 15, 1984, April 15, 1985,
May 28, 1985, August 1, 1985, September 1, 1985, November 1, 1985, April 15,
1986, May 14, 1986, May 15, 1986, February 25, 1987, October 15, 1987, February
24, 1988, September 15, 1988, May 15, 1989, June 13, 1989, October 15, 1989,
January 1, 1990, June 1, 1990, August 1, 1990, May 1, 1991, May 1, 1992, July
31, 1992, January 1, 1993, February 1, 1993, May 20, 1993, June 1, 1993,
September 15, 1994, May 1, 1995, May 2, 1995, June 1, 1995, July 15, 1995,
August 1, 1995, June 15, 1997 and August 1, 1997, respectively, are hereby in
all respects confirmed.
ARTICLE II
CREATION, PROVISIONS, REDEMPTION, PRINCIPAL AMOUNT
AND FORM OF PLEDGE BONDS DUE 2009
SECTION 1. The Company hereby creates a new series of Bonds to be issued
under and secured by the Indenture and to be designated as "First Mortgage
Bonds, 7.43% Series due 2009-D" of the Company and hereinabove and hereinafter
called the "Pledge Bonds due 2009". The Pledge Bonds due 2009 shall be executed,
authenticated and delivered
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in accordance with the provisions of, and shall in all respects be subject to,
all of the terms, conditions and covenants of the Indenture.
SECTION 2. The Pledge Bonds due 2009 shall be issued as fully registered
Bonds only, without coupons, in the denominations of $1,000 or any multiple
thereof.
SECTION 3. The Pledge Bonds due 2009 shall be dated the date of
authentication, shall mature November 1, 2009, and shall bear interest from the
time hereinafter provided at such rate per annum on each interest payment date
hereinafter defined as shall cause the amount of interest payable on such Pledge
Bonds due 2009 to equal the amount of interest payable on such interest payment
date on the Notes due 2009 (as defined below), such interest payable on May 1
and November 1 in each year starting on May 1, 1998 (each such date hereinafter
called an "interest payment date") on and until maturity, or, in the case of any
such Pledge Bonds duly called for redemption, on and until the redemption date,
or in the case of any default by the Company in the payment of the principal due
on any such Pledge Bonds, until the Company's obligation with respect to the
payment of the principal shall be discharged as provided in the Indenture. The
amount of interest payable on any interest payment date, the date of maturity
and any redemption date shall be computed on the same basis as the corresponding
matters are computed on the 7.43% Series C Secured Notes due 2009 and the 7.43%
Series D Secured Notes due 2009 provided for in the Note Indenture (together,
the "Notes due 2009").
The Pledge Bonds due 2009 shall be payable as to principal and interest at
the agency of the Company in the Borough of Manhattan, The City of New York, or,
at the option of the registered owner, at the agency of the Company in the City
of Cleveland, State of Ohio, in any coin or currency of the United States of
America which at the time of payment is legal tender for the payment of public
and private debts.
Except as hereinafter provided, each Pledge Bond due 2009 shall bear
interest from the later of the date of initial authentication of the Pledge
Bonds due 2009 or the most recent date to which interest has been paid or duly
provided for until the principal of such Pledge Bond due 2009 is paid or duly
provided for.
The interest payable on any interest payment date shall be paid to the
respective persons in whose names the Pledge Bonds due 2009 shall be registered
at the close of business on the Record Date next preceding such interest payment
date, notwithstanding the cancellation of any such Bond upon any transfer or
exchange thereof subsequent to such Record Date and prior to such interest
payment date; provided, however, that, if and to the extent the Company shall
default in the payment of the interest due on such interest payment
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date (other than an interest payment date that is a redemption date or maturity
date), such defaulted interest shall be paid to the respective persons in whose
names such outstanding Pledge Bonds due 2009 are registered at the close of
business on a date (the "Subsequent Record Date") not less than ten days nor
more than 15 days next preceding the date of payment of such defaulted interest,
such Subsequent Record Date to be established by the Company by notice given by
mail by or on behalf of the Company to the registered owners of Pledge Bonds due
2009 not less than 10 days next preceding such Subsequent Record Date. If any
interest payment date should fall on a day that is not a business day, then such
interest payment date shall be the next succeeding business day.
The initial interest rate on the Notes due 2009, and therefore on the
Pledge Bonds due 2009, is 7.43%. Under certain circumstances specified in a
Registration Agreement dated October 16, 1997 between the Company and the
Purchasers (as defined therein) of the Notes, the interest rate on the Notes due
2009, and therefore on the Pledge Bonds due 2009, will increase temporarily to
7.93%.
The term "Record Date", with respect to any interest payment date,
redemption date or date of maturity of any Pledge Bond, shall have the same
meaning as the term "Record Date" has with respect to those events for the Notes
due 2009.
SECTION 4. In the manner and subject to the limitations provided in the
Indenture, Pledge Bonds due 2009 may be transferred or may be exchanged for a
like aggregate principal amount of Bonds of such series of other authorized
denominations, in either case without charge, except for any tax or taxes or
other governmental charges incident to such transfer or exchange, at the agency
of the Company in the Borough of Manhattan, The City of New York.
In the event less than all of the Pledge Bonds due 2009 at the time
outstanding are called for redemption, the Company shall not be required (a) to
register any transfer or make any exchange of any such Bond for a period of 15
days before the mailing of the notice of redemption of any such Bonds, (b) to
register any transfer or make any exchange of any such Bond so called for
redemption in its entirety or (c) to register any transfer or make any exchange
of any portion of any such Bond so called for redemption.
Except as otherwise provided in Section 3 of this Article II with respect
to the payment of interest, the Company, the agencies of the Company and the
Trustee may deem and treat the person in whose name a Pledge Bond is registered
as the absolute owner thereof for the purpose of receiving any payment and for
all other purposes.
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SECTION 5. The Pledge Bonds due 2009 shall be redeemable only to the extent
provided in this Article II, subject to the provisions contained in Article IV
of the Indenture and the form of Pledge Bond due 2009.
SECTION 6. Subject to the applicable provisions of the Indenture, written
notice of redemption of Pledge Bonds due 2009 pursuant to this Supplemental
Indenture shall be given by the Trustee by mailing to each registered owner of
such Pledge Bonds due 2009 to be redeemed a notice of such redemption, first
class postage prepaid, at its last address as it shall appear upon the books of
the Company for the registration and transfer of such Pledge Bonds due 2009. Any
notice of redemption shall be mailed at least 30 days, but no more than 60 days,
prior to the redemption date. In the event of partial redemption of Pledge Bonds
due 2009, the Trustee shall select the Pledge Bonds due 2009 or portions thereof
to be redeemed, subject to the provisions of this Supplemental Indenture, in
such manner as the Trustee shall deem appropriate and fair.
SECTION 7. If and when any Notes due 2009 shall be purchased by the Company
and surrendered to the Note Trustee for cancellation or if and when the
principal of any Notes due 2009 shall be paid by the Company, then there shall
be deemed to have been paid a principal amount of the Pledge Bonds due 2009 then
outstanding which bears the same ratio to the aggregate principal amount of
Pledge Bonds due 2009 then outstanding as the principal amount of the Notes due
2009 so purchased or paid bears to the aggregate principal amount of the Notes
due 2009 outstanding immediately before such purchase or payment; provided,
however, that such purchase or payment of Pledge Bonds due 2009 shall be deemed
to have been made only when and to the extent that notice of such purchase or
payment of the principal amount of such Notes due 2009 shall have been given by
the Company to the Trustee. The Trustee may rely upon any such notification by
the Company that such purchase or payment of Notes due 2009 has been so made.
SECTION 8. The Pledge Bonds due 2009 shall be redeemed by the Company in
whole at any time prior to maturity at a redemption price of 100% of the
principal amount to be redeemed, plus accrued and unpaid interest to the
redemption date, but only if the Trustee shall receive a written demand from the
Note Trustee for redemption of all Pledge Bonds due 2009 held by the Note
Trustee stating that an "Event of Default" under the Note Indenture has occurred
and is continuing, that payment of the principal of the Notes due 2009 has been
accelerated and that the Note Trustee is waiving notice of redemption; provided,
however, that the Pledge Bonds due 2009 shall not be redeemed in the event that
prior to such redemption (a) the Trustee
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shall have received a certificate of the Note Trustee (i) stating that there has
been a waiver of such Event of Default and a rescission and annulment of such
acceleration or (ii) withdrawing said written demand or (b) an event of default
under Section 6.01 of Article VI of the Note Indenture shall have occurred and
be continuing, and there has been a declaration of acceleration of the principal
of the Pledge Bonds due 2009. The redemption of the Pledge Bonds due 2009
pursuant to this Section shall be made not more than 60 days after receipt of
the written demand.
SECTION 9. The Pledge Bonds due 2009 shall be subject to redemption by the
Company prior to maturity in whole at any time or in part from time to time, at
the same redemption price as shall be payable on the Notes due 2009 to be
redeemed concurrently therewith, such redemption price to equal the greater of
(i) 100% of the principal amount being redeemed and (ii) the sum of the present
values of the remaining scheduled payments of principal and interest thereon
discounted to the date of redemption on a semiannual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Treasury Yield (as defined in
the Note Indenture) plus twenty-five (25) basis points, plus in each case
accrued interest to the date of redemption, but in each instance only upon
receipt by the Trustee of an officers' certificate to the effect (a) that the
Company has given notice to the Note Trustee that the Company is exercising its
option to direct the redemption of all or part (specifying the principal amount)
of the Notes due 2009 as provided in the Note Indenture and (b) that an
equivalent principal amount of Pledge Bonds due 2009 shall be concurrently
called for redemption. Such officers' certificate shall specify the principal
amount of the Pledge Bonds due 2009 to be redeemed and the redemption price
thereof and accrued and unpaid interest to the redemption date, shall have
attached to it a copy of said notice to the Note Trustee and said direction of
the Company and shall specify the redemption date of such Pledge Bonds due 2009
(which redemption date shall be the same date as the redemption date of the
Notes due 2009 being concurrently redeemed which is specified in said attached
notice). The redemption of the Pledge Bonds due 2009 shall be made upon the
notice and in the manner provided in this Article II, subject to the provisions
of the Indenture.
SECTION 10. Subject to the provisions of the Indenture, written notice of
redemption of Pledge Bonds due 2009 pursuant to any of Sections 5 through 9,
inclusive, of this Article II shall be given by the Trustee by mailing to the
registered owner or owners of such Bonds to be redeemed a notice of such
redemption, first class postage prepaid, at its last address as it shall appear
upon the books of the Company for the registration and transfer of such Bonds.
Any notice of redemption pursuant to said Sections 5 through 9, inclusive, shall
be mailed at
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least 30 days and not more than 60 days before the redemption date; provided,
however, that the registered owner or owners of all Pledge Bonds due 2009 may
consent in writing to a shorter notice period, and such consent, if filed with
the Trustee, shall be binding upon the Company and such registered owner or
owners and their transferees. In the event of a partial redemption, the Trustee
shall select the Pledge Bonds due 2009 to be redeemed in such manner as the
Trustee shall deem appropriate and fair.
SECTION 11. If and when the Company shall pay interest for any given period
of time on the Notes due 2009, there shall be deemed to have been paid on the
Pledge Bonds due 2009 an amount of interest equal to the amount of interest paid
on the Notes due 2009; provided, however, that such payment of interest shall be
deemed to have been made only when and to the extent that notice of such payment
of interest on such Notes due 2009 shall have been given by the Company to the
Trustee. The Trustee may rely upon any such notification by the Company that
such payment of interest has been so made.
SECTION 12. Any Pledge Bonds due 2009 at any time purchased or otherwise
acquired by the Company shall be surrendered to the Trustee for cancellation and
the Trustee shall forthwith cancel the same.
SECTION 13. All Pledge Bonds due 2009 deemed to have been redeemed or paid
in full as provided in Sections 5 through 9, inclusive, of this Article II shall
be surrendered to the Trustee for cancellation and the Trustee shall forthwith
cancel the same. In the event that part of a Pledge Bond due 2009 shall be
deemed to have been redeemed or paid as provided in said Sections 5 through 9,
the registered owner may, at its option, surrender such Pledge Bond to the
Trustee for cancellation, in which event the Trustee shall cancel such Pledge
Bond and the Company shall execute and the Trustee shall authenticate and
deliver to the registered owner Pledge Bonds due 2009 in such authorized
denominations as shall be specified by the registered owner in an aggregate
principal amount equal to the unpaid balance of the principal amount of such
surrendered Pledge Bond.
SECTION 14. Pledge Bonds due 2009 shall not be transferable unless the
registered owner shall have first surrendered the same to the Trustee for
notation thereon of all payments of principal deemed to have been made thereon
under Section 7 of this Article II or for cancellation and execution,
authentication and delivery of Pledge Bonds due 2009 in an aggregate principal
amount equal to the unpaid balance of the principal amount of such surrendered
Pledge Bonds due 2009 under Section 13 of this Article II.
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SECTION 15. The aggregate principal amount of Pledge Bonds due 2009 which
may be authenticated and delivered hereunder shall not exceed $150,000,000,
except as otherwise provided in the Indenture.
SECTION 16. The form of the fully registered Pledge Bonds due 2009, and of
the Trustee's certificate of authentication thereon, shall be substantially as
follows:
[FORM OF FULLY REGISTERED BOND]
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
Incorporated under the laws of the State of Ohio
FIRST MORTGAGE BOND, 7.43% SERIES DUE 2009-D
Due November 1, 2009
No. $
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY, a corporation organized and
existing under the laws of the State of Ohio (hereinafter called the "Company",
which term shall include any successor corporation as defined in the Indenture
hereinafter referred to), for value received, hereby promises to pay to
, or registered assigns, the sum of Dollars
($ ) or the aggregate unpaid principal amount hereof (as shown on the
Schedule of Payments hereon), whichever is less, on November 1, 2009, in any
coin or currency of the United States of America which at the time of payment is
legal tender for the payment of public and private debts, and to pay interest on
the unpaid principal amount hereof in like coin or currency from the time
hereinafter provided, at such rate per annum as shall cause the amount of
interest payable on the Pledge Bonds due 2009 (hereinafter defined), together
with the interest payable on all other Pledge Bonds (hereinafter defined) held
by the Note Trustee (hereinafter defined), to equal the amount of interest
payable on the Notes due 2009 (hereinafter defined), such interest to be payable
on May 1 and November 1 in each year starting on May 1, 1998 (each such date
herein called an "interest payment date"), and on and until the date of maturity
of this Bond, or, if this Bond shall be duly called for redemption, on and until
the redemption date, or, if the Company shall default in the payment of the
principal amount of this Bond, until the Company's obligation with respect to
the payment of such principal shall be discharged as provided in said Indenture.
Except as hereinafter provided, this Bond shall bear interest from the date of
initial authentication of this Bond or the most recent date to which interest
has been paid or duly provided for until the principal of this Bond has been
paid or duly provided for. Subject to certain exceptions provided in said
Indenture, the interest payable on any interest payment date
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shall be paid to the person in whose name this Bond shall be registered at the
close of business on the Record Date (as defined in Section 3 of Article II of
the Supplemental Indenture, hereinafter defined) or, in the case of defaulted
interest, on a day preceding the date of payment thereof established by notice
to the registered owner of this Bond in the manner provided in the Supplemental
Indenture. Principal of and interest on this Bond are payable at the agency of
the Company in the Borough of Manhattan, The City of New York, or, at the option
of the registered owner, at the agency of the Company in the City of Cleveland,
State of Ohio.
This Bond is one of the duly authorized Bonds of the Company (herein called
the "Bonds"), all issued and to be issued under and equally secured by a
Mortgage and Deed of Trust dated July 1, 1940, executed by the Company to
Guaranty Trust Company of New York (subsequently Xxxxxx Guaranty Trust Company
of New York and then The Chase Manhattan Bank (National Association)), now
succeeded by The Chase Manhattan Bank as Trustee (herein called the "Trustee"),
and all indentures supplemental thereto (said Mortgage as so supplemented herein
called the "Indenture") to which reference is hereby made for a description of
the properties mortgaged and pledged, the nature and extent of the security, the
rights of the registered owner or owners of the Bonds and of the Trustee in
respect thereof, and the terms and conditions upon which the Bonds are, and are
to be, secured. The Bonds may be issued in series, for various principal sums,
may mature at different times, may bear interest at different rates and may
otherwise vary as in the Indenture provided. This Bond is one of a series
designated as the First Mortgage Bonds, 7.43% Series due 2009-D (herein called
the "Pledge Bonds due 2009") limited, except as otherwise provided in the
Indenture, in aggregate principal amount to $150,000,000, issued under and
secured by the Indenture and described in the Seventy-Sixth Supplemental
Indenture dated October 15, 1997, between the Company and the Trustee (herein
called the "Supplemental Indenture").
The Pledge Bonds due 2009 have been delivered by the Company to The Chase
Manhattan Bank, as trustee (hereinafter called the "Note Trustee"), pursuant to
a Note Indenture, dated as of October 24, 1997, between the Company and the Note
Trustee, under which the Note Trustee holds the Pledge Bonds due 2009 as
security for the payment of principal of and interest on 7.43% Series C Secured
Notes due 2009 and 7.43% Series D Secured Notes due 2009 (together, herein
called the "Notes due 2009").
If and when any Notes due 2009 are purchased by the Company and surrendered
to the Note Trustee for cancellation or the principal of any Notes due 2009 is
paid by the Company then there is deemed to
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be paid a principal amount of the Pledge Bonds due 2009 then outstanding which
bears the same ratio to the aggregate principal amount of Pledge Bonds due 2009
then outstanding as the aggregate principal amount of the Notes due 2009 so
purchased or paid bears to the aggregate principal amount of the Notes due 2009
outstanding immediately before such purchase or payment; provided, however, that
such purchase or payment of Pledge Bonds due 2009 is deemed to be made only when
and to the extent that notice of such purchase or payment of such Notes due 2009
is given by the Company to the Trustee.
If and when the Company pays interest for any given period of time on the
Notes due 2009, there shall be deemed to be paid on the Pledge Bonds due 2009 an
amount of interest equal to the amount of interest paid on the Notes due 2009;
provided, however, that such payment of interest is deemed to be made only when
and to the extent that notice of such payment of interest on such Notes due 2009
is given by the Company to the Trustee.
In the event that this Bond is deemed to be paid or redeemed in full, this
Bond shall be surrendered to the Trustee for cancellation. In the event that
this Bond is deemed to be paid or redeemed in part, this Bond may, at the option
of the registered owner, be surrendered to the Trustee for cancellation, in
which event the Trustee will cancel this Bond and the Company will execute and
the Trustee will authenticate and deliver to the registered owner Pledge Bonds
due 2009 in authorized denominations in aggregate principal amount equal to the
unpaid balance of the principal amount of this Bond.
The Pledge Bonds due 2009 shall be redeemed by the Company prior to
maturity in whole at any time as provided in Section 8 of Article II of the
Supplemental Indenture at a redemption price of 100% of the principal amount to
be redeemed, plus accrued and unpaid interest to the redemption date.
The Pledge Bonds due 2009 are subject to redemption by the Company prior to
maturity in whole at any time or in part from time to time as provided in
Section 9 of Article II of the Supplemental Indenture at the same redemption
price as shall be payable on the Notes due 2009 to be redeemed concurrently
therewith, such redemption price to equal the greater of (i) 100% of the
principal amount being redeemed and (ii) the sum of the present values of the
remaining scheduled payments of principal and interest thereon discounted to the
date of redemption on a semiannual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Yield (as defined in the Note Indenture)
plus twenty-five (25) basis points, plus in each case accrued interest to the
date of redemption.
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Any redemption of the Pledge Bonds due 2009 shall be made after written
notice to the registered owner or owners of such Bonds, sent by the Trustee by
first class mail, postage prepaid, at least 30 days and not more than 60 days
before the redemption date, unless a shorter notice period is consented to in
writing by the registered owner or owners of all Pledge Bonds due 2009 and such
consent is filed with the Trustee, and such redemption and notice shall be made
in the manner provided in Article II of the Supplemental Indenture, subject to
the provisions of the Indenture. In the event of a partial redemption, the
Trustee shall select the Pledge Bonds due 2009 to be redeemed in such manner as
the Trustee shall deem appropriate and fair.
In the Forty-Third Supplemental Indenture dated April 15, 1985 between the
Company and the Trustee, the Company has modified, in certain respects, the
redemption provisions in the Indenture effective only with respect to the Bonds
of all series established or created in said Forty-Third Supplemental Indenture
and all supplemental indentures dated after May 28, 1985.
To the extent permitted by and as provided in the Indenture, modifications
or alterations of the Indenture, or of any indenture supplemental thereto, and
of the rights and obligations of the Company and of the holders of the Bonds and
coupons may be made with the consent of the Company by an affirmative vote of
not less than 80% in principal amount of the Bonds entitled to vote then
outstanding, at a meeting of Bondholders called and held as provided in the
Indenture, and, in case one or more but less than all of the series of Bonds
then outstanding under the Indenture are so affected, by an affirmative vote of
not less than 80% in principal amount of the Bonds of any series entitled to
vote then outstanding and affected by such modification or alteration; provided,
however, that no such modification or alteration shall be made which will affect
the terms of payment of the principal of or interest on this Bond. In the
Nineteenth Supplemental Indenture dated November 23, 1976 between the Company
and the Trustee, the Company has modified the Indenture effective from and after
the time when none of the Bonds of any series established prior to the execution
of the Nineteenth Supplemental Indenture shall remain outstanding so as to
change "80%" in the foregoing sentence to "60%" and to make certain other
modifications of the Indenture and has reserved the right to make certain other
modifications of the Indenture without any vote, consent or other action by the
holders of Bonds of any series established in the Nineteenth Supplemental
Indenture or in any subsequent supplemental indenture.
If an event of default, as defined in the Indenture, shall occur, the
principal of all the Bonds at any such time outstanding under the Indenture may
be declared or may become due and payable, upon the
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conditions and in the manner and with the effect provided in the Indenture. The
Indenture provides that such declaration may in certain events be waived by the
holders of a majority in principal amount of the Bonds outstanding.
Subject to the limitations provided in the Indenture and the Note
Indenture, this Bond is transferable by the registered owner hereof, in person
or by duly authorized attorney, on the books of the Company to be kept for that
purpose at the agency of the Company in the Borough of Manhattan, The City of
New York upon surrender and cancellation of this Bond, and upon presentation of
a duly executed written instrument of transfer, and thereupon a new fully
registered Bond or Pledge Bonds due 2009 of the same series, of the same
aggregate principal amount and in authorized denominations will be issued to the
transferee or transferees in exchange herefor; and this Bond, with or without
others of the same series, may in like manner be exchanged for one or more new
fully registered Pledge Bonds due 2009 of the same series of other authorized
denominations but of the same aggregate principal amount; all without charge
except for any tax or taxes or other governmental charges incidental to such
transfer or exchange and all subject to the terms and conditions set forth in
the Indenture. In the event less than all of the Pledge Bonds due 2009 at the
time outstanding are called for redemption, the Company shall not be required
(a) to register any transfer or make any exchange of any such Pledge Bond for a
period of 15 days before the mailing of the notice of redemption of any such
Pledge Bonds, (b) to register any transfer or make any exchange of any such
Pledge Bond called for redemption in its entirety, or (c) to register any
transfer or make any exchange of any portion of any such Pledge Bond which has
been called for redemption. Except as otherwise provided herein with respect to
the payment of interest, the Company, the agencies of the Company and the
Trustee may deem and treat the person in whose name this Bond is registered as
the absolute owner hereof for the purpose of receiving any payment and for all
other purposes.
No recourse shall be had for the payment of the principal of or the
interest on this Bond, or for any claim based hereon or on the Indenture or any
indenture supplemental thereto, against any incorporator, or against any
stockholder, director or officer, past, present or future, of the Company, or of
any predecessor or successor corporation, as such, either directly or through
the Company or any such predecessor or successor corporation, 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, whether at common law,
in equity, by any constitution or statute or otherwise, of incorporators,
stockholders, directors or officers being released by every owner hereof by the
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acceptance of this Bond and as part of the consideration for the issue hereof,
and being likewise released by the terms of the Indenture.
This Bond shall not be entitled to any benefit under the Indenture or any
indenture supplemental thereto, or become valid or obligatory for any purpose,
until the Trustee under the Indenture, or a successor trustee thereto under the
Indenture, shall have signed the form of certificate of authentication endorsed
hereon.
IN WITNESS WHEREOF, The Cleveland Electric Illuminating Company has caused
this Bond to be signed in its name by its President or a Vice President (whose
signature may be manual or a facsimile thereof) and its corporate seal (or a
facsimile thereof) to be hereto affixed and attested by its Secretary or an
Assistant Secretary (whose signature may be manual or a facsimile thereof).
Dated:
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
By ....................................................
Attest:
...............................
Secretary
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This Bond is one of the Bonds of the series designated and described in the
within-mentioned Indenture and Supplemental Indenture.
THE CHASE MANHATTAN BANK, TRUSTEE
By ...........................................
AUTHORIZED OFFICER
[FORM OF SCHEDULE OF PAYMENTS]
SCHEDULE OF PAYMENTS
UNPAID AGENCY OF THE
PRINCIPAL PRINCIPAL PREMIUM INTEREST COMPANY AUTHORIZED
DATE PAYMENT AMOUNT PAYMENT PAYMENT MAKING NOTATION OFFICER TITLE
---- --------- --------- ------- -------- --------------- ---------- -----
[END OF FORM OF FULLY REGISTERED BOND]
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ARTICLE III
CREATION, PROVISIONS, REDEMPTION, PRINCIPAL AMOUNT
AND FORM OF PLEDGE BONDS DUE 2017
SECTION 1. The Company hereby creates a new series of Bonds to be issued
under and secured by the Indenture and to be designated as "First Mortgage
Bonds, 7.88% Series due 2017-B" of the Company and hereinabove and hereinafter
called the "Pledge Bonds due 2017". The Pledge Bonds due 2017 shall be executed,
authenticated and delivered in accordance with the provisions of, and shall in
all respects be subject to, all of the terms, conditions and covenants of the
Indenture.
SECTION 2. The Pledge Bonds due 2017 shall be issued as fully registered
Bonds only, without coupons, in the denominations of $1,000 or any multiple
thereof.
SECTION 3. The Pledge Bonds due 2017 shall be dated the date of
authentication, shall mature November 1, 2017, and shall bear interest from the
time hereinafter provided at such rate per annum on each interest payment date
hereinafter defined as shall cause the amount of interest payable on such Pledge
Bonds due 2017 to equal the amount of interest payable on such interest payment
date on the Notes due 2017 (as defined below), such interest payable on May 1
and November 1 in each year starting on May 1, 1998 (each such date hereinafter
called an "interest payment date") on and until maturity, or, in the case of any
such Pledge Bonds duly called for redemption, on and until the redemption date,
or in the case of any default by the Company in the payment of the principal due
on any such Pledge Bonds, until the Company's obligation with respect to the
payment of the principal shall be discharged as provided in the Indenture. The
amount of interest payable on any interest payment date, the date of maturity
and any redemption date shall be computed on the same basis as the corresponding
amount of interest is computed on the 7.88% Series C Secured Notes due 2017 and
7.88% Series D Secured Notes due 2017 provided for in the Note Indenture
(together, the "Notes due 2017").
The Pledge Bonds due 2017 shall be payable as to principal and interest at
the agency of the Company in the Borough of Manhattan, The City of New York, or,
at the option of the registered owner, at the agency of the Company in the City
of Cleveland, State of Ohio, in any coin or currency of the United States of
America which at the time of payment is legal tender for the payment of public
and private debts.
Except as hereinafter provided, each Pledge Bond due 2017 shall bear
interest from the later of the date of initial authentication of the
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Pledge Bonds due 2017 or the most recent date to which interest has been paid or
duly provided for until the principal of such Pledge Bond due 2017 is paid or
duly provided for.
The interest payable on any interest payment date shall be paid to the
respective persons in whose names the Pledge Bonds due 2017 shall be registered
at the close of business on the Record Date next preceding such interest payment
date, notwithstanding the cancellation of any such Bond upon any transfer or
exchange thereof subsequent to such Record Date and prior to such interest
payment date; provided, however, that, if and to the extent the Company shall
default in the payment of the interest due on such interest payment date (other
than an interest payment date that is a redemption date or maturity date), such
defaulted interest shall be paid to the respective persons in whose names such
outstanding Pledge Bonds due 2017 are registered at the close of business on a
date (the "Subsequent Record Date") not less than ten days nor more than 15 days
next preceding the date of payment of such defaulted interest, such Subsequent
Record Date to be established by the Company by notice given by mail by or on
behalf of the Company to the registered owners of Pledge Bonds due 2017 not less
than 10 days next preceding such Subsequent Record Date. If any interest payment
date should fall on a day that is not a business day, then such interest payment
date shall be the next succeeding business day.
The initial interest rate on the Notes due 2017, and therefore on the
Pledge Bonds due 2017, is 7.88%. Under certain circumstances specified in a
Registration Agreement dated October 16, 1997 between the Company and the
Purchasers (as defined therein) of the Notes, the interest rate on the Notes due
2017, and therefore on the Pledge Bonds due 2017, will increase temporarily to
8.38%.
The term "Record Date", with respect to any interest payment date,
redemption date or date of maturity of any Pledge Bond, shall have the same
meaning as the term "Record Date" has with respect to those events for the Notes
due 2017.
SECTION 4. In the manner and subject to the limitations provided in the
Indenture, Pledge Bonds due 2017 may be transferred or may be exchanged for a
like aggregate principal amount of Bonds of such series of other authorized
denominations, in either case without charge, except for any tax or taxes or
other governmental charges incident to such transfer or exchange, at the agency
of the Company in the Borough of Manhattan, The City of New York.
In the event less than all of the Pledge Bonds due 2017 at the time
outstanding are called for redemption, the Company shall not be required (a) to
register any transfer or make any exchange of any
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such Bond for a period of 15 days before the mailing of the notice of redemption
of any such Bonds, (b) to register any transfer or make any exchange of any such
Bond so called for redemption in its entirety or (c) to register any transfer or
make any exchange of any portion of any such Bond so called for redemption.
Except as otherwise provided in Section 3 of this Article III with respect
to the payment of interest, the Company, the agencies of the Company and the
Trustee may deem and treat the person in whose name a Pledge Bond is registered
as the absolute owner thereof for the purpose of receiving any payment and for
all other purposes.
SECTION 5. The Pledge Bonds due 2017 shall be redeemable only to the extent
provided in this Article III, subject to the provisions contained in Article IV
of the Indenture and the form of Pledge Bond due 2017.
SECTION 6. Subject to the applicable provisions of the Indenture, written
notice of redemption of Pledge Bonds due 2017 pursuant to this Supplemental
Indenture shall be given by the Trustee by mailing to each registered owner of
such Pledge Bonds due 2017 to be redeemed a notice of such redemption, first
class postage prepaid, at its last address as it shall appear upon the books of
the Company for the registration and transfer of such Pledge Bonds due 2017. Any
notice of redemption shall be mailed at least 30 days, but no more than 60 days,
prior to the redemption date. In the event of partial redemption of Pledge Bonds
due 2017, the Trustee shall select the Pledge Bonds due 2017 or portions thereof
to be redeemed, subject to the provisions of this Supplemental Indenture, in
such manner as the Trustee shall deem appropriate and fair.
SECTION 7. If and when any Notes due 2017 shall be purchased by the Company
and surrendered to the Note Trustee for cancellation or if and when the
principal of any Notes due 2017 shall be paid by the Company, then there shall
be deemed to have been paid a principal amount of the Pledge Bonds due 2017 then
outstanding which bears the same ratio to the aggregate principal amount of
Pledge Bonds due 2017 then outstanding as the principal amount of the Notes due
2017 so purchased or paid bears to the aggregate principal amount of the Notes
due 2017 outstanding immediately before such purchase or payment; provided,
however, that such purchase or payment of Pledge Bonds due 2017 shall be deemed
to have been made only when and to the extent that notice of such purchase or
payment of the principal amount of such Notes due 2017 shall have been given by
the Company to the Trustee. The Trustee may rely upon any such notification by
the Company that such purchase or payment of Notes due 2017 has been so made.
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SECTION 8. The Pledge Bonds due 2017 shall be redeemed by the Company in
whole at any time prior to maturity at a redemption price of 100% of the
principal amount to be redeemed, plus accrued and unpaid interest to the
redemption date, but only if the Trustee shall receive a written demand from the
Note Trustee for redemption of all Pledge Bonds due 2017 held by the Note
Trustee stating that an "Event of Default" under the Note Indenture has occurred
and is continuing, that payment of the principal of the Notes due 2017 has been
accelerated and that the Note Trustee is waiving notice of redemption; provided,
however, that the Pledge Bonds due 2017 shall not be redeemed in the event that
prior to such redemption (a) the Trustee shall have received a certificate of
the Note Trustee (i) stating that there has been a waiver of such Event of
Default and a rescission and annulment of such acceleration or (ii) withdrawing
said written demand or (b) an event of default under Section 6.01 of Article VI
of the Note Indenture shall have occurred and be continuing, and there has been
a declaration of acceleration of the principal of the Pledge Bonds due 2017. The
redemption of the Pledge Bonds due 2017 pursuant to this Section shall be made
not more than 60 days after receipt of the written demand.
SECTION 9. The Pledge Bonds due 2017 shall be subject to redemption by the
Company prior to maturity in whole at any time or in part from time to time, at
the same redemption price as shall be payable on the Notes due 2017 to be
redeemed concurrently therewith, such redemption price to equal the greater of
(i) 100% of the principal amount being redeemed and (ii) the sum of the present
values of the remaining scheduled payments of principal and interest thereon
discounted to the date of redemption on a semiannual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Treasury Yield (as defined in
the Note Indenture) plus twenty-five (25) basis points, plus in each case
accrued interest to the date of redemption, but in each instance only upon
receipt by the Trustee of an officers' certificate to the effect (a) that the
Company has given notice to the Note Trustee that the Company is exercising its
option to direct the redemption of all or part (specifying the principal amount)
of the Notes due 2017 as provided in the Note Indenture and (b) that an
equivalent principal amount of Pledge Bonds due 2017 shall be concurrently
called for redemption. Such officers' certificate shall specify the principal
amount of the Pledge Bonds due 2017 to be redeemed and the redemption price
thereof and accrued and unpaid interest to the redemption date, shall have
attached to it a copy of said notice to the Note Trustee and said direction of
the Company and shall specify the redemption date of such Pledge Bonds due 2017
(which redemption date shall be the same date as the redemption date of the
Notes due 2017 being concurrently redeemed which is specified in said attached
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notice). The redemption of the Pledge Bonds due 2017 shall be made upon the
notice and in the manner provided in this Article III, subject to the provisions
of the Indenture.
SECTION 10. Subject to the provisions of the Indenture, written notice of
redemption of Pledge Bonds due 2017 pursuant to any of Sections 5 through 9,
inclusive, of this Article III shall be given by the Trustee by mailing to the
registered owner or owners of such Bonds to be redeemed a notice of such
redemption, first class postage prepaid, at its last address as it shall appear
upon the books of the Company for the registration and transfer of such Bonds.
Any notice of redemption pursuant to said Sections 5 through 9, inclusive, shall
be mailed at least 30 days and not more than 60 days before the redemption date;
provided, however, that the registered owner or owners of all Pledge Bonds due
2017 may consent in writing to a shorter notice period, and such consent , if
filed with the Trustee, shall be binding upon the Company and such registered
owner or owners and their transferees. In the event of a partial redemption, the
Trustee shall select the Pledge Bonds due 2017 to be redeemed in such manner as
the Trustee shall deem appropriate and fair.
SECTION 11. If and when the Company shall pay interest for any given period
of time on the Notes due 2017, there shall be deemed to have been paid on the
Pledge Bonds due 2017 an amount of interest equal to the amount of interest paid
on the Notes due 2017; provided, however, that such payment of interest shall be
deemed to have been made only when and to the extent that notice of such payment
of interest on such Notes due 2017 shall have been given by the Company to the
Trustee. The Trustee may rely upon any such notification by the Company that
such payment of interest has been so made.
SECTION 12. Any Pledge Bonds due 2017 at any time purchased or otherwise
acquired by the Company shall be surrendered to the Trustee for cancellation and
the Trustee shall forthwith cancel the same.
SECTION 13. All Pledge Bonds due 2017 deemed to have been redeemed or paid
in full as provided in Sections 5 through 9, inclusive, of this Article III
shall be surrendered to the Trustee for cancellation and the Trustee shall
forthwith cancel the same. In the event that part of a Pledge Bond due 2017
shall be deemed to have been redeemed or paid as provided in said Sections 5
through 9, the registered owner may, at its option, surrender such Pledge Bond
to the Trustee for cancellation, in which event the Trustee shall cancel such
Pledge Bond and the Company shall execute and the Trustee shall authenticate and
deliver to the registered owner Pledge Bonds due 2017 in such authorized
denominations as shall be specified by the registered owner in an aggregate
principal amount equal to the unpaid balance of the principal amount of such
surrendered Pledge Bond.
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SECTION 14. Pledge Bonds due 2017 shall not be transferable unless the
registered owner shall have first surrendered the same to the Trustee for
notation thereon of all payments of principal deemed to have been made thereon
under Section 7 of this Article III or for cancellation and execution,
authentication and delivery of Pledge Bonds due 2017 in an aggregate principal
amount equal to the unpaid balance of the principal amount of such surrendered
Pledge Bonds due 2017 under Section 13 of this Article III.
SECTION 15. The aggregate principal amount of Pledge Bonds due 2017 which
may be authenticated and delivered hereunder shall not exceed $300,000,000,
except as otherwise provided in the Indenture.
SECTION 16. The form of the fully registered Pledge Bonds due 2017, and of
the Trustee's certificate of authentication thereon, shall be substantially as
follows:
[FORM OF FULLY REGISTERED BOND]
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
Incorporated under the laws of the State of Ohio
FIRST MORTGAGE BOND, 7.88% SERIES DUE 2017-B
Due November 1, 2017
No. $
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY, a corporation organized and
existing under the laws of the State of Ohio (hereinafter called the "Company",
which term shall include any successor corporation as defined in the Indenture
hereinafter referred to), for value received, hereby promises to pay to
, or registered assigns, the sum of Dollars
($ ) or the aggregate unpaid principal amount hereof (as shown on the
Schedule of Payments hereon), whichever is less, on November 1, 2017, in any
coin or currency of the United States of America which at the time of payment is
legal tender for the payment of public and private debts, and to pay interest on
the unpaid principal amount hereof in like coin or currency from the time
hereinafter provided, at such rate per annum as shall cause the amount of
interest payable on the Pledge Bonds due 2017 (hereinafter defined), together
with the interest payable on all other Pledge Bonds (hereinafter defined) held
by the Note Trustee (hereinafter defined), to equal the amount of interest
payable on the Notes due 2017 (hereinafter defined), such interest to be payable
on May 1 and November 1 in each year starting on May 1, 1998 (each such date
herein called an "interest payment date"), and on and until the date of maturity
of this Bond, or, if this Bond shall be duly called for redemption, on and until
the redemption date, or, if the Company shall default in the payment of the
principal amount of this Bond, until the
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Company's obligation with respect to the payment of such principal shall be
discharged as provided in said Indenture. Except as hereinafter provided, this
Bond shall bear interest from the date of initial authentication of this Bond or
the most recent date to which interest has been paid or duly provided for until
the principal of this Bond has been paid or duly provided for. Subject to
certain exceptions provided in said Indenture, the interest payable on any
interest payment date shall be paid to the person in whose name this Bond shall
be registered at the close of business on the Record Date (as defined in Section
3 of Article III of the Supplemental Indenture, hereinafter defined) or, in the
case of defaulted interest, on a day preceding the date of payment thereof
established by notice to the registered owner of this Bond in the manner
provided in the Supplemental Indenture. Principal of and interest on this Bond
are payable at the agency of the Company in the Borough of Manhattan, The City
of New York, or, at the option of the registered owner, at the agency of the
Company in the City of Cleveland, State of Ohio.
This Bond is one of the duly authorized Bonds of the Company (herein called
the "Bonds"), all issued and to be issued under and equally secured by a
Mortgage and Deed of Trust dated July 1, 1940, executed by the Company to
Guaranty Trust Company of New York (subsequently Xxxxxx Guaranty Trust Company
of New York and then The Chase Manhattan Bank (National Association)), now
succeeded by The Chase Manhattan Bank as Trustee (herein called the "Trustee"),
and all indentures supplemental thereto (said Mortgage as so supplemented herein
called the "Indenture") to which reference is hereby made for a description of
the properties mortgaged and pledged, the nature and extent of the security, the
rights of the registered owner or owners of the Bonds and of the Trustee in
respect thereof, and the terms and conditions upon which the Bonds are, and are
to be, secured. The Bonds may be issued in series, for various principal sums,
may mature at different times, may bear interest at different rates and may
otherwise vary as in the Indenture provided. This Bond is one of a series
designated as the First Mortgage Bonds, 7.88% Series due 2017-B (herein called
the "Pledge Bonds due 2017") limited, except as otherwise provided in the
Indenture, in aggregate principal amount to $300,000,000, issued under and
secured by the Indenture and described in the Seventy-Sixth Supplemental
Indenture dated October 15, 1997, between the Company and the Trustee (herein
called the "Supplemental Indenture").
The Pledge Bonds due 2017 have been delivered by the Company to The Chase
Manhattan Bank, as trustee (hereinafter called the "Note Trustee"), pursuant to
a Note Indenture, dated as of October 24, 1997, between the Company and the Note
Trustee, under which the Note Trustee holds the Pledge Bonds due 2017 as
security for the payment
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of principal and interest on 7.88% Series C Secured Notes due 2017 and 7.88%
Series D Secured Notes due 2017 (together, herein called the "Notes due 2017").
If and when any Notes due 2017 are purchased by the Company and surrendered
to the Note Trustee for cancellation or the principal of any Notes due 2017 is
paid by the Company then there shall be deemed to be paid a principal amount of
the Pledge Bonds due 2017 then outstanding which bears the same ratio to the
aggregate principal amount of Pledge Bonds due 2017 then outstanding as the
principal amount of the Notes due 2017 so purchased or paid bears to the
aggregate principal amount of the Notes due 2017 outstanding immediately before
such purchase or payment; provided, however, that such purchase or payment of
Pledge Bonds due 2017 is deemed to be made only when and to the extent that
notice of such purchase or payment of such Notes due 2017 is given by the
Company to the Trustee.
If and when the Company pays interest for any given period of time on the
Notes due 2017, there shall be deemed to be paid on the Pledge Bonds due 2017 an
amount of interest equal to the amount of interest paid on the Notes due 2017;
provided, however, that such payment of interest is deemed to be made only when
and to the extent that notice of such payment of interest on such Notes due 2017
is given by the Company to the Trustee.
In the event that this Bond is deemed to be paid or redeemed in full, this
Bond shall be surrendered to the Trustee for cancellation. In the event that
this Bond is deemed to be paid or redeemed in part, this Bond may, at the option
of the registered owner, be surrendered to the Trustee for cancellation, in
which event the Trustee will cancel this Bond and the Company will execute and
the Trustee will authenticate and deliver to the registered owner Pledge Bonds
due 2017 in authorized denominations in aggregate principal amount equal to the
unpaid balance of the principal amount of this Bond.
The Pledge Bonds due 2017 shall be redeemed by the Company prior to
maturity in whole at any time as provided in Section 8 of Article III of the
Supplemental Indenture at a redemption price of 100% of the principal amount to
be redeemed, plus accrued and unpaid interest to the redemption date.
The Pledge Bonds due 2017 are subject to redemption by the Company prior to
maturity in whole at any time or in part from time to time as provided in
Section 9 of Article III of the Supplemental Indenture at the same redemption
price as shall be payable on the Notes due 2017 to be redeemed concurrently
therewith, such redemption price to equal the greater of (i) 100% of the
principal amount being redeemed and (ii) the sum of the present values of the
remaining
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scheduled payments of principal and interest thereon discounted to the date of
redemption on a semiannual basis (assuming a 360-day year consisting of twelve
30-day months) at the Treasury Yield (as defined in the Note Indenture) plus
twenty-five (25) basis points, plus in each case accrued interest to the date of
redemption.
Any redemption of the Pledge Bonds due 2017 shall be made after written
notice to the registered owner or owners of such Bonds, sent by the Trustee by
first class mail, postage prepaid, at least 30 days and not more than 60 days
before the redemption date, unless a shorter notice period is consented to in
writing by the registered owner or owners of all Pledge Bonds due 2017 and such
consent is filed with the Trustee, and such redemption and notice shall be made
in the manner provided in Article III of the Supplemental Indenture, subject to
the provisions of the Indenture. In the event of a partial redemption, the
Trustee shall select the Pledge Bonds due 2017 to be redeemed in such manner as
the Trustee shall deem appropriate and fair.
In the Forty-Third Supplemental Indenture dated April 15, 1985 between the
Company and the Trustee, the Company has modified, in certain respects, the
redemption provisions in the Indenture effective only with respect to the Bonds
of all series established or created in said Forty-Third Supplemental Indenture
and all supplemental indentures dated after May 28, 1985.
To the extent permitted by and as provided in the Indenture, modifications
or alterations of the Indenture, or of any indenture supplemental thereto, and
of the rights and obligations of the Company and of the holders of the Bonds and
coupons may be made with the consent of the Company by an affirmative vote of
not less than 80% in principal amount of the Bonds entitled to vote then
outstanding, at a meeting of Bondholders called and held as provided in the
Indenture, and, in case one or more but less than all of the series of Bonds
then outstanding under the Indenture are so affected, by an affirmative vote of
not less than 80% in principal amount of the Bonds of any series entitled to
vote then outstanding and affected by such modification or alteration; provided,
however, that no such modification or alteration shall be made which will affect
the terms of payment of the principal of or interest on this Bond. In the
Nineteenth Supplemental Indenture dated November 23, 1976 between the Company
and the Trustee, the Company has modified the Indenture effective from and after
the time when none of the Bonds of any series established prior to the execution
of the Nineteenth Supplemental Indenture shall remain outstanding so as to
change "80%" in the foregoing sentence to "60%" and to make certain other
modifications of the Indenture and has reserved the right to make certain other
modifications of the Indenture without any vote, consent or other action by the
holders of Bonds of any series estab-
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lished in the Nineteenth Supplemental Indenture or in any subsequent
supplemental indenture.
If an event of default, as defined in the Indenture, shall occur, the
principal of all the Bonds at any such time outstanding under the Indenture may
be declared or may become due and payable, upon the conditions and in the manner
and with the effect provided in the Indenture. The Indenture provides that such
declaration may in certain events be waived by the holders of a majority in
principal amount of the Bonds outstanding.
Subject to the limitations provided in the Indenture and the Note
Indenture, this Bond is transferable by the registered owner hereof, in person
or by duly authorized attorney, on the books of the Company to be kept for that
purpose at the agency of the Company in the Borough of Manhattan, The City of
New York upon surrender and cancellation of this Bond, and upon presentation of
a duly executed written instrument of transfer, and thereupon a new fully
registered Bond or Pledge Bonds due 2017 of the same series, of the same
aggregate principal amount and in authorized denominations will be issued to the
transferee or transferees in exchange herefor; and this Bond, with or without
others of the same series, may in like manner be exchanged for one or more new
fully registered Pledge Bonds due 2017 of the same series of other authorized
denominations but of the same aggregate principal amount; all without charge
except for any tax or taxes or other governmental charges incidental to such
transfer or exchange and all subject to the terms and conditions set forth in
the Indenture. In the event less than all of the Pledge Bonds due 2017 at the
time outstanding are called for redemption, the Company shall not be required
(a) to register any transfer or make any exchange of any such Pledge Bond for a
period of 15 days before the mailing of the notice of redemption of any such
Pledge Bonds, (b) to register any transfer or make any exchange of any such
Pledge Bond called for redemption in its entirety, or (c) to register any
transfer or make any exchange of any portion of any such Pledge Bond which has
been called for redemption. Except as otherwise provided herein with respect to
the payment of interest, the Company, the agencies of the Company and the
Trustee may deem and treat the person in whose name this Bond is registered as
the absolute owner hereof for the purpose of receiving any payment and for all
other purposes.
No recourse shall be had for the payment of the principal of or the
interest on this Bond, or for any claim based hereon or on the Indenture or any
indenture supplemental thereto, against any incorporator, or against any
stockholder, director or officer, past, present or future, of the Company, or of
any predecessor or successor corporation, as such, either directly or through
the Company or any such predecessor
29
25
or successor corporation, 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, whether at common law, in equity, by any constitution or statute
or otherwise, of incorporators, stockholders, directors or officers being
released by every owner hereof by the acceptance of this Bond and as part of the
consideration for the issue hereof, and being likewise released by the terms of
the Indenture.
This Bond shall not be entitled to any benefit under the Indenture or any
indenture supplemental thereto, or become valid or obligatory for any purpose,
until the Trustee under the Indenture, or a successor trustee thereto under the
Indenture, shall have signed the form of certificate of authentication endorsed
hereon.
IN WITNESS WHEREOF, The Cleveland Electric Illuminating Company has caused
this Bond to be signed in its name by its President or a Vice President (whose
signature may be manual or a facsimile thereof) and its corporate seal (or a
facsimile thereof) to be hereto affixed and attested by its Secretary or an
Assistant Secretary (whose signature may be manual or a facsimile thereof).
Dated:
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
By ....................................................
Attest:
...............................
Secretary
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This Bond is one of the Bonds of the series designated and described in the
within-mentioned Indenture and Supplemental Indenture.
THE CHASE MANHATTAN BANK, TRUSTEE
By ...........................................
AUTHORIZED OFFICER
[FORM OF SCHEDULE OF PAYMENTS]
SCHEDULE OF PAYMENTS
UNPAID AGENCY OF THE
PRINCIPAL PRINCIPAL PREMIUM INTEREST COMPANY AUTHORIZED
DATE PAYMENT AMOUNT PAYMENT PAYMENT MAKING NOTATION OFFICER TITLE
---- --------- --------- ------- -------- --------------- ---------- -----
[END OF FORM OF FULLY REGISTERED BOND]
30
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ARTICLE IV
THE TRUSTEE
SECTION 1. The Trustee hereby accepts the trusts hereby declared and
provided upon the terms and conditions in the Indenture set forth and upon the
terms and conditions set forth in this Article IV.
SECTION 2. The Trustee shall not be responsible in any manner whatsoever
for or in respect of the validity or sufficiency of this Supplemental Indenture
or the due execution hereof by the Company or for or in respect of the recitals
contained herein, all of which recitals are made by the Company solely. In
general, each and every term and condition contained in Article XIII of the
Indenture shall apply to this Supplemental Indenture with the same force and
effect as if the same were herein set forth in full, with such omissions,
variations and modifications thereof as may be appropriate.
SECTION 3. For purposes of this Supplemental Indenture (a) the Trustee may
conclusively rely and shall be protected in acting upon the written demand from,
or certificate of, any agency duly appointed by resolution of the Board of
Directors of the Company or any officers' certificate or opinion of counsel, as
to the truth of the statements and the correctness of the opinions expressed
therein, without independent investigation or verification thereof, subject to
Article XIII of the Indenture and (b) a written demand from, or certificate of,
an agency of the Company shall mean a written demand or certificate executed by
the president, any vice president or any trust officer of, or any other person
authorized to act for, such agency, as such.
SECTION 4. The Company shall cause any agency of the Company, other than
the Trustee, which it may appoint from time to time to act as such agency in
respect of the Pledge Bonds, to execute and deliver to the Trustee an instrument
in which such agency shall:
(a) Agree to keep and maintain, and furnish to the Trustee from time
to time as reasonably requested by the Trustee, appropriate records of all
transactions carried out by it as such agency and to furnish the Trustee
such other information and reports as the Trustee may reasonably require;
(b) Certify that it is eligible for appointment as such agency and
agree to notify the Trustee promptly if it shall cease to be so eligible;
and
(c) Agree to indemnify the Trustee, in a manner satisfactory to the
Trustee, against any loss, liability or expense incurred by,
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27
and defend any claim asserted against, the Trustee by reason of any acts or
failures to act as such agency, except for any liability resulting from any
action taken by it at the specific direction of the Trustee;
provided, however, that the Company, in lieu of causing any such agency to
furnish such an instrument, may make such other arrangements with the Trustee in
respect of any such agency as shall be satisfactory to the Trustee.
SECTION 5. The Trustee shall advise the Company in writing of the receipt
of any notification provided for in or any cancellation made pursuant to
Sections 6 through 13 of Articles II and III of this Supplemental Indenture.
ARTICLE V
MISCELLANEOUS PROVISIONS
This Supplemental Indenture may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original; but such
counterparts shall together constitute but one and the same instrument.
EXECUTION
IN WITNESS WHEREOF, said The Cleveland Electric Illuminating Company has
caused this Supplemental Indenture to be executed on its behalf by its President
or one of its Vice Presidents and its corporate seal to be hereto affixed and
said seal and this Supplemental Indenture to be attested by its Secretary or an
Assistant Secretary, and said The Chase Manhattan Bank, in evidence of its
acceptance of the trust hereby created, has caused this Supplemental Indenture
to be executed on its behalf by one of its Vice Presidents or one of its
Corporate Trust Officers, and its corporate seal to be hereto affixed and said
seal and this Supplemental Indenture to be attested by one of its Assistant
Secretaries, all as of the day and year first above written.
32
S-1
THE CLEVELAND ELECTRIC ILLUMINATING COMPANY
By: XXXXXXXX X. XXXXXXX
--------------------------------------------------
Xxxxxxxx X. Xxxxxxx, Vice President
ATTEST:
XXXXX X. XXXXXX
------------------------------------------
Xxxxx X. Xxxxxx, Secretary
Signed, sealed and acknowledged by The
Cleveland Electric Illuminating Company in
the presence of:
[SEAL]
XXXXX X. XXXXXX
------------------------------------------
Xxxxx X. Xxxxxx
XXXXXXXX X. XXXXXXXX
------------------------------------------
Xxxxxxxx X. Xxxxxxxx
As witnesses
THE CHASE MANHATTAN BANK, AS TRUSTEE
By: X.X. XXXXXXXX
--------------------------------------------------
X.X. Xxxxxxxx, Vice President
ATTEST:
XXXXXXX X. XXXX
------------------------------------------
Xxxxxxx X. Xxxx, Senior Trust Officer
Signed, sealed and acknowledged by The
Chase Manhattan Bank in the presence of:
[SEAL]
XXXXX XXXXXXXXXXX
------------------------------------------
Xxxxx Xxxxxxxxxxx
XXXXX X. XXXXXXX
------------------------------------------
Xxxxx X. Xxxxxxx
As witnesses
33
S-2
STATE OF OHIO )
) SS:
COUNTY OF CUYAHOGA )
On this 13th day of October, 1997, before me personally appeared Xxxxxxxx
X. Xxxxxxx and Xxxxx X. Xxxxxx to me personally known, who being by me severally
duly sworn, did say that they are a Vice President and the Secretary,
respectively, of The Cleveland Electric Illuminating Company, that the seal
affixed to the foregoing instrument is the corporate seal of said corporation
and that said instrument was signed and sealed in behalf of said corporation by
authority of its Board of Directors; and said officers severally acknowledged
said instrument to be the free act and deed of said corporation.
XXXXX X. XXXXXX
------------------------------------------
Notary Public
Xxxxx X. Xxxxxx
Notary Public, State of Ohio
Recorded in Cuyahoga County
My Commission expires January 19, 2000
[SEAL]
STATE OF NEW YORK )
) SS:
COUNTY OF NEW YORK )
On this 14th day of October, 1997, before me personally appeared X.X.
Xxxxxxxx and Xxxxxxx X. Xxxx to me personally known, who being by me severally
duly sworn, did say that they are a Vice President and a Senior Trust Officer,
respectively, of The Chase Manhattan Bank, that the seal affixed to the
foregoing instrument is the corporate seal of said corporation and that said
instrument was signed and sealed in behalf of said corporation by authority of
its Board of Directors; and said officers severally acknowledged said instrument
to be the free act and deed of said corporation.
XXXXX XXXXX
------------------------------------------
Notary Public
Xxxxx Xxxxx
Notary Public, State of New York
No. 00-0000000
Qualified in Kings County
Certificate Filed in New York County
Commission expires December 31, 1997
[SEAL]
This Instrument Prepared By Xxxx X. Xxxxxxx, Attorney At Law.
34
R-1
This page contains information as to recording and filing which was not set
forth in this Supplemental Indenture at the time of execution. This page is not
a part of this Supplemental Indenture.
RECORDING AND FILING DATA
This Supplemental Indenture was filed for record and recorded in the record
of mortgages in the offices of the Recorders of the following Counties:
COUNTY VOLUME PAGE FILED FOR RECORD
------ ------ ---- ----------------
Ohio
Ashtabula )
Cuyahoga )
Geauga )
Lake )
Lorain ) October , 1997
Ottawa )
Portage )
Xxxxx )
Summit )
Trumbull )
Pennsylvania )
Warren )
Beaver )
This Supplemental Indenture was filed for record and recorded in the
Registered Land Department of the offices of the Recorders of the following
Counties in the State of Ohio
COUNTY DOCUMENT NUMBER FILED FOR RECORD
------ --------------- ----------------
Cuyahoga
Lake October , 1997
An amendment to a previously filed financing statement and a counterpart of
this Supplemental Indenture were filed in the office of the Secretary of the
Commonwealth of Pennsylvania on October , 1997 under original file number
, microfilm number 18111533, to comply with the filing requirements of
the Pennsylvania enactment of the Uniform Commercial Code.
