EXHIBIT 4.1
THE AES CORPORATION
as Issuer
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
--------------------
INDENTURE
Dated as of October 29, 1997
--------------------
8.50% Senior Subordinated Notes due 2007
8.875% Senior Subordinated Debentures due 2027
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CROSS-REFERENCE TABLE
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TIA Indenture
Section Section
------- ---------
ss. 310(a)(1)................................................. 7.10
(a)(2)................................................. 7.10
(a)(3)................................................. N.A.
(a)(4)................................................. N.A.
(a)(5)................................................. 7.10
(b).................................................... 7.8; 7.10;
10.2
(c).................................................... N.A.
ss. 311(a).................................................... 7.11
(b).................................................... 7.11
(c).................................................... N.A.
ss. 312(a).................................................... 2.5
(b).................................................... 10.3
(c).................................................... 10.3
ss. 313(a).................................................... 7.6
(b)(1)................................................. 7.6
(b)(2)................................................. 7.6
(c).................................................... 7.6; 10.2
(d).................................................... 7.6
ss. 314(a).................................................... 4.6; 4.7;
10.2
(b).................................................... N.A.
(c)(1)................................................. 10.4
(c)(2)................................................. 10.4
(c)(3)................................................. 10.4
(d).................................................... N.A.
(e).................................................... 10.5
(f).................................................... N.A.
ss. 315(a).................................................... 7.1(b)
(b).................................................... 7.5; 10.2
(c).................................................... 7.1(a)
(d).................................................... 7.1(c)
(e).................................................... 6.11
ss. 316(a) (last sentence).................................... 2.9
(a)(1)(A).............................................. 6.5
(a)(1)(B) ............................................. 6.4
(a)(2)................................................. N.A.
(b).................................................... 6.6, 6.7
(c).................................................... 9.4
ss. 317(a)(1)................................................. 6.8
(a)(2)................................................. 6.9
(b).................................................... 2.4
ss. 318(a).................................................... 10.1
(c).................................................... 10.1
_________________
N.A. means Not Applicable
NOTE: This Cross-Reference Table Shall not, for any purpose, be deemed to be a
part of this Indenture
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions.....................................................1
SECTION 1.2 Incorporation by Reference of Trust Indenture Act..............24
SECTION 1.3 Rules of Construction..........................................25
ARTICLE II
THE SECURITIES
SECTION 2.1 Form and Dating.................................................26
SECTION 2.2 Execution and Authentication....................................28
SECTION 2.3 Registrar and Paying Agent......................................29
SECTION 2.4 Paying Agent To Hold Money in Trust.............................29
SECTION 2.5 Securityholder Lists............................................29
SECTION 2.6 Transfer and Exchange...........................................30
SECTION 2.7 Replacement Securities..........................................40
SECTION 2.8 Temporary Securities............................................41
SECTION 2.9 Cancellation....................................................41
SECTION 2.10 Defaulted Interest..............................................42
SECTION 2.11 CUSIP or CINS Number............................................43
SECTION 2.12 Payments of Interest............................................43
SECTION 2.13 Outstanding Securities..........................................44
SECTION 2.14 Treasury Securities.............................................44
ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.1 Right of Redemption.............................................45
SECTION 3.2 Applicability of Article........................................45
SECTION 3.3 Election To Redeem; Notice to Trustee...........................45
SECTION 3.4 Selection by Trustee of Securities To Be Redeemed...............45
SECTION 3.5 Notice of Redemption............................................46
SECTION 3.6 Deposit of Redemption Price.....................................46
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SECTION 3.7 Securities Payable on Redemption Date...........................47
SECTION 3.8 Sinking Fund....................................................47
SECTION 3.9 Selection of Debentures.........................................48
SECTION 3.10 Credit for Debentures Previously
Acquired..........Error! Bookmark not defined.
SECTION 3.11 Securities Redeemed in Part............ ........................49
ARTICLE IV
COVENANTS
SECTION 4.1 Payment of Securities...........................................49
SECTION 4.2 Maintenance of Office or Agency.................................49
SECTION 4.3 Corporate Existence.............................................50
SECTION 4.4 Limitation on Business..........................................50
SECTION 4.5 Limitation on Restricted Subsidiary Investments and Mergers.....51
SECTION 4.6 Compliance Certificates.........................................51
SECTION 4.7 Reports.........................................................52
SECTION 4.8 Limitation on Debt..............................................52
SECTION 4.9 Limitation on Restricted Subsidiary Debt........................54
SECTION 4.10 Limitation on Additional Tiers of Senior Subordinated Debt......57
SECTION 4.11 Change of Control...............................................58
SECTION 4.12 Limitation on Transactions with Affiliates......................60
SECTION 4.13 Limitation on Restricted Payments...............................61
SECTION 4.14 Limitation on Dividend and other Payment Restrictions
Affecting Subsidiaries......................................63
SECTION 4.15 Limitation on Asset Dispositions................................65
ARTICLE V
SUCCESSOR CORPORATION
SECTION 5.1 Merger, Consolidation, Etc......................................71
SECTION 5.2 Successor Entity Substituted....................................71
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.1 Events of Default...............................................72
SECTION 6.2 Acceleration....................................................74
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SECTION 6.3 Other Remedies..................................................75
SECTION 6.4 Waiver of Past Default..........................................75
SECTION 6.5 Control by Majority.............................................76
SECTION 6.6 Limitation on Suits.............................................76
SECTION 6.7 Rights of Holders To Receive Payment............................76
SECTION 6.8 Collection Suit by Trustee......................................77
SECTION 6.9 Trustee May File Proofs of Claim................................77
SECTION 6.10 Priorities......................................................78
SECTION 6.11 Undertaking for Costs...........................................78
SECTION 6.12 Rights and Remedies Cumulative..................................78
SECTION 6.13 Delay or Omission Not Waiver....................................79
SECTION 6.14 Restoration of Rights and Remedies..............................79
ARTICLE VII
TRUSTEE
SECTION 7.1 Duties of Trustee...............................................79
SECTION 7.2 Rights of Trustee...............................................81
SECTION 7.3 Individual Rights of Trustee....................................82
SECTION 7.4 Trustee's Disclaimer............................................82
SECTION 7.5 Notice of Defaults..............................................82
SECTION 7.6 Reports by Trustee to Holders...................................83
SECTION 7.7 Compensation and Indemnity......................................83
SECTION 7.8 Replacement of Trustee..........................................84
SECTION 7.9 Successor Trustee by Merger, Etc................................85
SECTION 7.10 Eligibility; Disqualification...................................85
SECTION 7.11 Preferential Collection of Claims Against Company...............86
ARTICLE VIII
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
SECTION 8.1 Satisfaction and Discharge of Indenture.........................86
SECTION 8.2 Application by Trustee of Funds Deposited for Payment of
Securities..................................................88
SECTION 8.3 Repayment of Moneys Held by Paying Agent........................88
SECTION 8.4 Return of Moneys Held by Trustee and Paying Agent Unclaimed
for Two Years...............................................88
SECTION 8.5 Defeasance and Discharge of Indenture...........................88
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SECTION 8.6 Defeasance of Certain Obligations...............................90
SECTION 8.7 Reinstatement...................................................92
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders......................................92
SECTION 9.2 With Consent of Holders.........................................93
SECTION 9.3 Compliance with Trust Indenture Act.............................94
SECTION 9.4 Revocation and Effect of Consents...............................95
SECTION 9.5 Notation on or Exchange of Securities...........................95
SECTION 9.6 Trustee to Sign Amendments, Etc.................................96
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Trust Indenture Act Controls....................................96
SECTION 10.2 Notices.........................................................96
SECTION 10.3 Communications by Holders with Other Holders....................98
SECTION 10.4 Certificate and Opinion of Counsel as to Conditions Precedent...98
SECTION 10.5 Statements Required in Certificate and Opinion of Counsel.......98
SECTION 10.6 Rules by Trustee, Paying Agent, Registrar.......................99
SECTION 10.7 Legal Holidays..................................................99
SECTION 10.8 Governing Law...................................................99
SECTION 10.9 No Recourse Against Others......................................99
SECTION 10.10 Successors.....................................................100
SECTION 10.11 Counterparts...................................................100
SECTION 10.12 Severability...................................................100
SECTION 10.13 Table of Contents, Headings, Etc...............................100
SECTION 10.14 No Adverse Interpretation of Other Agreements..................100
SECTION 10.15 Benefits of Indenture..........................................100
SECTION 10.16 Independence of Covenants......................................100
ARTICLE XI
SUBORDINATION OF SECURITIES
SECTION 11.1 Agreement to Subordinate.......................................101
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SECTION 11.2 Payments to Securityholders....................................101
SECTION 11.3 Subrogation of Securities......................................103
SECTION 11.4 Authorization by Securityholders...............................105
SECTION 11.5 Notice to Trustee..............................................105
SECTION 11.6 Trustee's Relation to Senior Debt..............................106
SECTION 11.7 o Impairment of Subordination..................................107
SIGNATURES ...........................................................S-1
EXHIBIT A - Form of Note
EXHIBIT B - Form of Debenture
EXHIBIT C - Form of Certificate of Transfer
EXHIBIT D - Form of Certificate of Exchange
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INDENTURE dated as of October 29, 1997, between THE AES CORPORATION, a
Delaware corporation, as Issuer (the "Company"), and THE FIRST NATIONAL BANK OF
CHICAGO, a national banking association, as Trustee (the "Trustee").
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of the 8.50% Senior
Subordinated Notes due 2007 of the Company (the "Notes") and 8.875% Senior
Subordinated Debentures due 2027 (the "Debentures" and collectively with the
Notes, the "Securities") to be issued as provided for in this Indenture. All
things necessary to make this Indenture a valid, binding agreement of the
Company, in accordance with its terms, have been done.
The parties hereto agree as follows for the benefit of each other and
for the equal and ratable benefit of the Holders:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
------------------------------------------
SECTION 1.1 Definitions.
-----------
"Acquisition Debt" means Debt of any Person existing at the time such
Person became a Restricted Subsidiary of the Company (or such Person is merged
into the Company or one of its Restricted Subsidiaries) or assumed in connection
with the acquisition of assets from any such Person (other than assets acquired
in the ordinary course of business), including Debt Incurred in connection with,
or in contemplation of, such Person becoming a Restricted Subsidiary of the
Company (but excluding Debt of such Person which is extinguished, retired or
repaid in connection with such Person becoming a Restricted Subsidiary of the
Company).
"Additional Interest" shall have the meaning set forth in the
Registration Rights Agreement.
"Adjusted Consolidated Net Income" means, for any period, for any
Person the aggregate Net Income (or loss) of such Person and its Consolidated
Subsidiaries for such period determined in conformity with GAAP plus the Net
Income of any Restricted Subsidiary of such Person for prior periods to the
extent such Net Income is actually paid in cash to such Person
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during such period plus the Net Income of any Person (other than a Restricted
Subsidiary) in which such Person has a joint interest with a third party for
prior periods to the extent such Net Income is actually paid in cash to such
Person during such period; provided that the following items shall be excluded
in computing Adjusted Consolidated Net Income (without duplication): (i) the Net
Income (or loss) of any Person (other than a Restricted Subsidiary) in which
such Person has a joint interest with a third party, except to the extent such
Net Income is actually paid in cash to such Person during such period; (ii)
solely for the purposes of calculating the amount of Restricted Payments that
may be made pursuant to clauses (c)(1) or (c)(2) of Section 4.13 (and in such
case, except to the extent includible pursuant to clause (i) above), the Net
Income (if positive) of such Person accrued prior to the date it becomes a
Restricted Subsidiary of any other Person or is merged into or consolidated with
such other Person or any of its Restricted Subsidiaries or all or substantially
all of the property and assets of such Person are acquired by such other Person
or any of its Restricted Subsidiaries; (iii) the Net Income (or loss) of any
Restricted Subsidiary of such Person, except to the extent such Net Income (if
positive) is actually paid in cash to such Person during such period; (iv) any
gains or losses (on an after-tax basis) attributable to Asset Sales; (v) the
cumulative effect of a change in accounting principle; and (vi) any amounts paid
or accrued as dividends on Preferred Stock of such Person or Preferred Stock of
any Restricted Subsidiary of such Person.
"AES Hawaii" means AES Hawaii Management Co., Inc., a Delaware
corporation and a Subsidiary of the Company, and its successors.
"AES Oklahoma" means AES Oklahoma Management Co., Inc., a Delaware
corporation and a Subsidiary of the Company, and its successors.
"Affiliate" means, as applied to any Person, any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such Person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling", "controlled by"
and "under common control with") when used with respect to any Person is defined
to mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
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"Agent" means any Registrar, Paying Agent, transfer agent or
Authenticating Agent.
"Applicable Procedures" means, with respect to any transfer or
exchange of interests in a Global Security, the rules and procedures of DTC,
Euroclear or Cedel that apply to such transfer or exchange.
"Asset Acquisition" means (i) an investment by the Company or any of
its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary of the Company or any of its Restricted
Subsidiaries or shall be merged into or consolidated with the Company or any of
its Restricted Subsidiaries or (ii) an acquisition by the Company or any of its
Restricted Subsidiaries of the Property of any Person other than the Company or
any of its Restricted Subsidiaries that constitutes substantially all of an
operating unit or business of such Person.
"Asset Disposition" means, with respect to any Person, any sale,
transfer, conveyance, lease or other disposition (including by way of merger,
consolidation or sale-leaseback) by such Person or any of its Restricted
Subsidiaries to any Person (other than to such Person or a Consolidated
Subsidiary of such Person and other than in the ordinary course of business) of
(i) any assets (excluding cash and cash equivalents) of such Person or any of
its Restricted Subsidiaries or (ii) any shares of Capital Stock of such Person's
Restricted Subsidiaries. For purposes of this definition, any disposition in
connection with directors' qualifying shares or investments by foreign nationals
mandated by applicable law shall not constitute an Asset Disposition. In
addition, the term "Asset Disposition" shall not include any sale, transfer,
conveyance, lease or other disposition of assets governed by Section 5.1. The
term "Asset Disposition" also shall not include (i) any sale of shares of
Preferred Stock of a Restricted Subsidiary, (ii) the grant of a security
interest by any Person in any assets or shares of Capital Stock securing a
borrowing by, or contractual performance obligation of, such Person or any
Restricted Subsidiary of such Person, (iii) a sale-leaseback transaction
involving substantially all of the assets of a Power Supply Business where a
Restricted Subsidiary of the Company sells the Power Supply Business to a Person
in exchange for the assumption by that Person of the Debt financing the Power
Supply Business and the Restricted Subsidiary leases the Power Supply Business
from such Person, (iv) dispositions of contract rights, development rights and
resource data made in connection with the initial development of a Power Supply
Business, made
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prior to the commencement of commercial operation of such Power Supply Business
or (v) transactions made in order to enhance the repatriation of cash proceeds
in connection with a Foreign Asset Disposition or in order to increase the
after-tax proceeds thereof available for immediate distribution.
"Asset Sale" means the sale or other disposition by the Company or any
of its Restricted Subsidiaries (other than to the Company or another Restricted
Subsidiary of the Company) of (i) all or substantially all of the Capital Stock
of any Restricted Subsidiary of the Company or (ii) all or substantially all of
the Property that constitutes an operating unit or business of the Company or
any of its Restricted Subsidiaries.
"Average Life" means, at any date of determination with respect to any
debt security, the quotient obtained by dividing (i) the sum of the product of
(A) the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security multiplied by (B)
the amount of such principal payment by (ii) the sum of all such principal
payments.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
Federal or state law for the relief, reorganization, adjustment or recomposition
of debtors.
"Bank Agent" means Xxxxxx Guaranty Trust Company of New York, as agent
for the Banks pursuant to the Bank Credit Agreement, and any successor or
successors thereto in such capacity.
"Bank Credit Agreement" means the Credit Agreement dated as of August
2, 1996 among the Company, the Banks named on the signature pages thereof and
the Bank Agent, as such agreement has been and may be amended, restated,
supplemented or otherwise modified from time to time, and includes any agreement
extending the maturity of, or restructuring (including, but not limited to, the
inclusion of additional borrowers thereunder that are Restricted Subsidiaries of
the Company and whose obligations are guaranteed by the Company thereunder) all
or any portion of, the Debt under such agreement or any successor agreements and
includes any agreement with one or more banks or other lending institutions
refinancing all or any portion of the Debt under such agreement or any successor
agreements.
"Banks" means the lenders who are from time to time parties to the
Bank Credit Agreement.
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"Board of Directors" means either the Board of Directors of the
Company or (except for the purposes of clause (iii) of the definition of "Change
of Control") any committee of such Board duly authorized to act hereunder.
"Board Resolution" means one or more resolutions of the Board of
Directors, certified by the secretary or an assistant secretary to have been
duly adopted and to be in full force and effect on the date of certification,
and delivered to the Trustee.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions are authorized
or required by law or regulation to close in The City of New York.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of, or interests in (however designated), the equity of
such Person which is outstanding or issued on or after the Closing Date,
including, without limitation, all Common Stock and Preferred Stock and
partnership and joint venture interests of such Person.
"Capitalized Lease" means, as applied to any Person, any lease of any
Property of which the discounted present value of the rental obligations of such
Person as lessee, in conformity with GAAP, is required to be capitalized on the
balance sheet of such Person; and "Capitalized Lease Obligation" is defined to
mean the rental obligations, as aforesaid, under such lease.
"Cedel" means Cedel Bank, societe anonyme.
"Change of Control" means the occurrence of one or more of the
following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of the Company to any Person or group (as that term is used in
Section 13(d)(3) of the Exchange Act) of Persons, (ii) a Person or group (as so
defined) of Persons (other than management of the Company on the date of this
Indenture or their Affiliates) shall have become the beneficial owner of more
than 35% of the outstanding Voting Stock of the Company, or (iii) during any
one-year period, individuals who at the beginning of such period constitute the
Board of Directors (together with any new director whose election or nomination
was approved by a major-
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ity of the directors then in office who were either directors at the beginning
of such period or who were previously so approved) cease to constitute a
majority of the Board of Directors.
"Change of Control Offer" has the meaning provided in Section 4.11.
"Closing Date" means the date on which the Securities are originally
issued under this Indenture.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the TIA, then the body performing
such duties at such time.
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of common stock of such Person which is outstanding or
issued on or after the date of this Indenture, including, without limitation,
all series and classes of such common stock.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article V of this Indenture
and thereafter means the successor.
"Consolidated EBITDA" of any Person for any period means the Adjusted
Consolidated Net Income of such Person, plus (without duplication) (i) income
taxes (other than income taxes (x) (either positive or negative) attributable to
extraordinary and non-recurring gains or losses or Asset Sales and (y) actually
payable with respect to such period) determined on a consolidated basis for such
Person and its Consolidated Subsidiaries in accordance with GAAP to the extent
payable by such Person, (ii) Consolidated Fixed Charges, (iii) depreciation and
amortization expense for such period and prior periods, all determined on a
consolidated basis for such Person and its Consolidated Subsidiaries in
accordance with GAAP, but only to the extent that the positive cash flow
associated with such depreciation and amortization expense is actually received
in cash by such Person during such period and (iv) all other non-cash items
reducing Net Income for such period and prior periods, all determined on a
consolidated basis for such Person and its Consolidated Subsidiaries in
accordance with GAAP, but only to
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the extent that the positive cash flow associated with such non-cash items is
actually received in cash by such Person during such period, and less (without
duplication) (i) all non-cash items increasing Net Income of such Person during
such period and prior periods, but only to the extent that positive cash flow
associated with such non-cash items in not actually received in cash by such
Person during such period, and (ii) the aggregate amount of any capitalized
expenses (including capitalized interest) paid by such Person during such period
which have the effect of increasing Net Income for such period.
"Consolidated Fixed Charges" of any Person means, for any period, the
aggregate of (i) Consolidated Interest Expense, (ii) the interest component of
Capitalized Leases, determined on a consolidated basis for such Person and its
Consolidated Subsidiaries in accordance with GAAP, excluding any interest
component of Capitalized Leases in respect of that portion of a Capitalized
Lease Obligation of a Restricted Subsidiary that is Non-Recourse to such Person
and (iii) cash and non-cash dividends due (whether or not declared) on any
Redeemable Stock of such Person.
"Consolidated Interest Expense" of any Person means, for any period,
the aggregate interest expense in respect of Debt (including amortization of
original issue discount and non-cash interest payments or accruals) of such
Person and its Consolidated Subsidiaries, determined on a consolidated basis in
accordance with GAAP, including all commissions, discounts, other fees and
charges owed with respect to letters of credit and bankers' acceptance financing
and net costs associated with Interest Rate Agreements and any amounts paid
during such period in respect of such interest expense, commissions, discounts,
other fees and charges that have been capitalized; provided that Consolidated
Interest Expense of the Company shall not include any interest expense
(including all commissions, discounts, other fees and charges owed with respect
to letters of credit and bankers' acceptance financing and net costs associated
with Interest Rate Agreements) in respect of that portion of Debt of a
Restricted Subsidiary of the Company that is Non-Recourse to the Company; and
provided further that Consolidated Interest Expense of the Company in respect of
a Guarantee by the Company of Debt of a Restricted Subsidiary shall be equal to
the commissions, discounts, other fees and charges that would be due with
respect to a hypothetical letter of credit issued under the Bank Credit
Agreement that can be drawn by the beneficiary thereof in the amount of the Debt
so guaranteed if (i) the Company is not actually making directly or indirectly
interest payments on such Debt and (ii) GAAP does not
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require the Company on an unconsolidated basis to record such Debt as a
liability of the Company.
"Consolidated Subsidiary" means at any date with respect to any
Person, any Subsidiary of such Person or other entity the accounts of which
would be consolidated with those of such Person in its consolidated financial
statements if such statements were prepared as of such date, other than an
Unrestricted Subsidiary.
"Consolidated Total Assets" means, with respect to any Person at any
time, the total assets of such Person and its Consolidated Subsidiaries at such
time determined in conformity with GAAP.
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
administered, which office is, at the date of this Indenture, located at Xxx
Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000-0000.
"Currency Agreement" means, with respect to any Person, any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement designed to protect such Person or any of its Restricted
Subsidiaries against fluctuations in currency values to or under which such
Person or any of its Restricted Subsidiaries is a party or a beneficiary on the
Closing Date or becomes a party or a beneficiary thereafter.
"Debenture" or "Debentures" means any Debenture or Debentures, as the
case may be, authenticated and delivered under this Indenture.
"Debt" means, with respect to any Person at any date of determination
(without duplication), (i) all indebtedness of such Person for borrowed money,
(ii) all obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments, (iii) all obligations of such Person in respect of
letters of credit or bankers' acceptance or other similar instruments (or
reimbursement obligations with respect thereto), (iv) all obligations of such
Person to pay the deferred purchase price of property or services, except Trade
Payables, (v) all obligations of such Person as lessee under Capitalized Leases,
(vi) all Debt of others secured by a Lien on any asset of such Person, whether
or not such Debt is assumed by such Person; provided that, for purposes of
determining the amount of any Debt of the type described in this clause, if
recourse
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with respect to such Debt is limited to such asset, the amount of such Debt
shall be limited to the lesser of the fair market value of such asset or the
amount of such Debt, (vii) all Debt of others Guaranteed by such Person to the
extent such Debt is Guaranteed by such Person, (viii) all Redeemable Stock
valued at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends and (ix) to the extent not otherwise included
in this definition, all obligations of such Person under Currency Agreements and
Interest Rate Agreements.
"Default" means any Event of Default as defined in Section 6.1 and any
event that is, or after notice or passage of time or both would be, an Event of
Default.
"Defaulted Interest" has the meaning specified in Section 2.10.
"Designated Senior Debt" means (i) Debt under the Bank Credit
Agreement and (ii) Debt constituting Senior Debt which, at the time of its
determination, (A) has an aggregate principal amount of at least $30 million and
(B) is specifically designated in the instrument evidencing such Senior Debt as
"Designated Senior Debt" by the Company.
"DTC" means The Depository Trust Company or its successors.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York (Brussels
Office) as operator of the Euroclear system.
"Event of Default" has the meaning provided in Section 6.1.
"Excess Cash Flow" of any Person for any period means Consolidated
EBITDA less Consolidated Fixed Charges less any income taxes actually paid by
such Person during such period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Registration Statement" shall have the meaning set forth in
the Registration Rights Agreement.
"Finance Subsidiary" means a Wholly-Owned Subsidiary of the Company
that does not engage in any activity other than (i) the holding of Debt of the
Company that both (x) is subordinated to the Securities and (y) provides for no
payments of
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principal by way of sinking fund, mandatory redemption or otherwise prior to the
maturity of the Securities, (ii) the issuance of Capital Stock and (iii) any
activity necessary, incidental or related to the foregoing.
"Fixed Charge Ratio" means the ratio, on a pro forma basis, of (i) the
aggregate amount of Consolidated EBITDA of any Person for the Reference Period
immediately prior to the date of the transaction giving rise to the need to
calculate the Fixed Charge Ratio (the "Transaction Date") to (ii) the aggregate
Consolidated Fixed Charges of such Person during such Reference Period; provided
that for purposes of such computation, in calculating Consolidated EBITDA and
Consolidated Fixed Charges, (1) the Incurrence of the Debt giving rise to the
need to calculate the Fixed Charge Ratio and the application of the proceeds
therefrom shall be assumed to have occurred on the first day of the Reference
Period, (2) Asset Sales and Asset Acquisitions which occur during the Reference
Period or subsequent to the Reference Period and prior to the Transaction Date
(but including any Asset Acquisition to be made with the Debt Incurred pursuant
to clause (1) above) shall be assumed to have occurred on the first day of the
Reference Period, (3) the Incurrence of any Debt during the Reference Period or
subsequent to the Reference Period and prior to the Transaction Date and the
application of the proceeds therefrom shall be assumed to have occurred on the
first day of such Reference Period, (4) Consolidated Interest Expense
attributable to any Debt (whether existing or being Incurred) computed on a pro
forma basis and bearing a floating interest rate shall be computed as if the
rate in effect on the date of computation had been the applicable rate for the
entire period unless such Person or any of its Restricted Subsidiaries is a
party to an Interest Rate Agreement (which shall remain in effect for the twelve
month period after the Transaction Date) which has the effect of fixing the
interest rate on the date of computation, in which case such rate (whether
higher or lower) shall be used and (5) there shall be excluded from Consolidated
Fixed Charges any Consolidated Fixed Charges related to any amount of Debt which
was outstanding during and subsequent to the Reference Period but is not
outstanding on the Transaction Date, except for Consolidated Fixed Charges
actually incurred with respect to Debt borrowed (as adjusted pursuant to clause
(4)) (x) under a revolving credit or similar arrangement to the extent the
commitment thereunder remains in effect on the Transaction Date or (y) pursuant
to clause (iv) of Section 4.8(b). For the purpose of making this computation,
Asset Sales and Asset Acquisitions which have been made by any Person which has
become a Restricted Subsidiary of the Company or been merged with or into
-11-
the Company or any Restricted Subsidiary of the Company during the Reference
Period or subsequent to the Reference Period and prior to the Transaction Date
shall be calculated on a pro forma basis (including all of the calculations
referred to in clauses (1) through (5) above assuming such Asset Sales or Asset
Acquisitions occurred on the first day of the Reference Period).
"Foreign Asset Disposition" means any Asset Disposition in respect of
the Capital Stock and/or Property of any Restricted Subsidiary of any Person
where such Restricted Subsidiary is organized under the laws of any jurisdiction
other than the U.S. or any state thereof or any Restricted Subsidiary of the
type described in Section 936 of the Internal Revenue Code of 1986, as amended,
to the extent that the proceeds of such Asset Disposition are received by a
Person subject in respect of such proceeds to the tax laws of a jurisdiction
other than the U.S. or any state thereof.
"GAAP" means generally accepted accounting principles in the U.S. as
in effect as of the date of this Indenture applied on a basis consistent with
the principles, methods, procedures and practices employed in the preparation of
the Company's audited financial statements, including, without limitation, those
set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession.
"Global Security" means each global security, without coupons,
representing all or a portion of the Notes or the Debentures, respectively,
deposited with DTC, substantially in the form of Exhibit A and Exhibit B,
respectively, attached hereto.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Debt or other obligation of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keepwell, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of
-12-
assuring in any other manner the obligee of such Debt or other obligation of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
"Holder", "holder of Securities", "Securityholder" and other similar
terms mean the registered holder of any Security.
"Incur" means, with respect to any Debt, to incur, create, issue,
assume, Guarantee or otherwise become liable for or with respect to, or become
responsible for, the payment of, contingently or otherwise, such Debt; provided
that neither the accrual of interest (whether such interest is payable in cash
or kind) nor the accretion of original issue discount shall be considered an
Incurrence of Debt.
"Indenture" means this Indenture as originally executed and delivered
or as it may be amended or supplemented from time to time pursuant to the terms
hereof.
"Independent Financial Advisor" means a nationally recognized
investment banking firm (i) which does not (and whose directors, officers,
employees and Affiliates do not) have a direct or indirect material financial
interest in the Company and (ii) which, in the sole judgment of the Board of
Directors, is otherwise independent and qualified to perform the task for which
such firm is being engaged.
"Initial Global Securities" means the Regulation S Global Securities
and the 144A Global Securities, each of which contains a Securities Act Legend.
"Initial Securities" means the Securities containing a Securities Act
Legend.
"Interest Payment Date," when used with respect to any Security, means
the stated maturity of an installment of interest specified in such Security.
"Interest Rate Agreement" means, with respect to any Person, any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement designed to protect such Person or any
-13-
of its Restricted Subsidiaries against fluctuations in interest rates to or
under which such Person or any of its Restricted Subsidiaries is a party or a
beneficiary on the date of the Indenture or becomes a party or a beneficiary
thereafter.
"Intermediate Holding Company" means any Restricted Subsidiary of the
Company that serves as a holding company for the Company's direct or indirect
interests in Power Supply Businesses and Unrelated Businesses.
"Investment" in a Person means any investment in, loan or advance to,
Guarantee on behalf of, directly or indirectly, or other transfer of assets to
such Person. For purposes of the definition of "Unrestricted Subsidiary" and
Section 4.13, "Investment" shall include (i) the fair market value of the assets
(net of liabilities) of any Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary and shall exclude
the fair market value of the assets (net of liabilities) of any Unrestricted
Subsidiary at the time that such Unrestricted Subsidiary is designated a
Restricted Subsidiary and (ii) any property transferred to or from any Person
shall be valued at its fair market value at the time of such transfer, in each
case as determined by the Board of Directors in good faith.
"Investment Grade" means, with respect to any security, a rating of
Baa3 or higher of such security by Xxxxx'x Investors Service Inc. together with
a rating of BBB- or higher of such security by Standard & Poor's Corporation.
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
that, as to any such arrangement in corporate form, such corporation shall not,
as to any Person of which such corporation is a Subsidiary, be considered to be
a Joint Venture to which such Person is a party.
"Legal Holiday" means any day other than a Business Day.
"Lien" means, with respect to any Property, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
Property. For purposes of this Indenture, the Company shall be deemed to own
subject to a Lien any Property which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such Property.
-14-
"Mandatory Sinking Fund Payment Amount" shall have the meaning set
forth in Section 3.8.
"Mandatory Sinking Fund Redemption Date" shall have the meaning set
forth in Section 3.8.
"Material AES Entity" means (i) any Subsidiary Guarantor, (ii) any of
AES Connecticut Management Co., Inc., AES Thames, Inc., AES Barbers Point, Inc.
and AES Shady Point, Inc. and (iii) any other Person in which the Company has a
direct or indirect equity Investment if such Person's contribution to
Consolidated EBITDA of the Company for the four most recently completed fiscal
quarters of the Company constitutes 15% or more of the Consolidated EBITDA of
the Company for such period, in each case, other than an Unrestricted
Subsidiary.
"Material Subsidiary" of a Person means, as of any date, any
Restricted Subsidiary that would constitute a "significant subsidiary" within
the meaning of Article 1 of Regulation S-X.
"Maturity Date," when used with respect to any Security, means the
date specified in such Security as the fixed date on which the final installment
of principal of such Security is due and payable (in the absence of any
acceleration thereof pursuant to Section 6.2 or any Change of Control Offer
pursuant to Section 4.11).
"Net Cash Proceeds" from an Asset Disposition means cash opayments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only as
and when received (including any cash received upon sale or disposition of such
note or receivable), excluding any other consideration received in the form of
assumption by the acquiring Person of Debt or other obligations relating to the
Property disposed of in such Asset Disposition or received in any other noncash
form) therefrom, in each case, net of all legal, title and recording tax
expenses, commissions and other fees and expenses incurred (including, without
limitation, consent and waiver fees and any applicable premiums, earn-out or
working interest payments or payments in lieu or in termination thereof), and
all federal, state, provincial, foreign and local taxes required to be accrued
as a liability under GAAP (i) as a consequence of such Asset Disposition, (ii)
as a result of the repayment of any Debt in any jurisdiction other than the
jurisdiction where the Property disposed of was located or (iii) as a result of
any repatriation to the U.S. of any proceeds of
-15-
such Asset Disposition, and in each case net of a reasonable reserve for the
after tax-cost of any indemnification payments (fixed and contingent)
attributable to seller's indemnities to the purchaser undertaken by the Company
or any of its Restricted Subsidiaries in connection with such Asset Disposition
(but excluding any payments, which by the terms of the indemnities will not,
under any circumstances, be made during the term of the Securities), and net of
all payments made on any Debt which is secured by such Property, in accordance
with the terms of any Lien upon or with respect to such Property or which must
by its terms or by applicable law be repaid out of the proceeds from such Asset
Disposition, and net of all distributions and other payments made to minority
interest holders in Restricted Subsidiaries or Joint Ventures as a result of
such Asset Disposition.
"Net Income" of any Person for any period means the net income (loss)
of such Person for such period, determined in accordance with GAAP, except that
extraordinary and non-recurring gains and losses as determined in accordance
with GAAP shall be excluded.
"Net Worth" of any Person means, as of any date, the aggregate of
capital, surplus and retained earnings (including any cumulative translation
adjustment) of such Person and its Consolidated Subsidiaries as would be shown
on a consolidated balance sheet of such Person and its Consolidated Subsidiaries
prepared as of such date in accordance with GAAP.
"Non-Recourse" to a Person as applied to any Debt (or portion thereof)
means that such Person is not directly or indirectly liable to make any payments
with respect to such Debt (or portion thereof), that no Guarantee of such Debt
(or portion thereof) has been made by such Person and that such Debt (or portion
thereof) is not secured by a Lien on any asset of such Person.
"Note" or "Notes" means any Note or Notes, as the case may be,
authenticated and delivered under this Indenture.
"Offering Memorandum" means the offering memorandum dated October 24,
1997 relating to the Securities.
"Officer" means, with respect to the Company, the chairman of
the board of directors, the president or chief executive officer, any vice
president, the chief financial officer, the treasurer or any assistant
treasurer, or the secretary or any assistant secretary.
-16-
"Officers' Certificate" means a certificate signed in the name of the
Company (i) by the chairman of the board of directors, the president or chief
executive officer or a vice president and (ii) by the chief financial officer,
the treasurer or any assistant treasurer, or the secretary or any assistant
secretary, complying with Section 10.5 and delivered to the Trustee. Each such
certificate shall comply with Section 314 of the TIA and include (except as
otherwise expressly provided in this Indenture) the statements provided in
Section 10.5.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Company or who may be other
counsel. Each such opinion shall comply with Section 314 of the TIA and include
the statements provided in Section 10.5, if and to the extent required thereby.
"original issue date" of any Security (or portion thereof) means the
earlier of (a) the date of authentication of such Security or (b) the date of
any Security (or portion thereof) for which such Security was issued (directly
or indirectly) on registration of transfer, exchange or substitution.
"Participant" means, with respect to DTC, Euroclear or Cedel, a Person
who has an account with DTC, Euroclear or Cedel, respectively (and, with respect
to DTC, it shall include Euroclear or Cedel).
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities on behalf of
the Company.
"Payment Blockage Period" shall have the meaning set forth in Section
11.2.
"Permitted Investment" means any Investment of the type specified in
clauses (iv) or (vi) of the definition of Restricted Payment which is made
directly or indirectly by the Company and its Restricted Subsidiaries; provided
that (i) at the time such Investment is made, the Company could Incur at least
$1 of Debt under Section 4.8(a); (ii) at the time such Investment is made, no
Event of Default or event that, after the giving of notice or lapse of time or
both would become an Event of Default, shall have occurred and be continuing;
(iii) after giving effect to the Investment, the aggregate Investments made by
the Company and its Restricted Subsidiaries in the applicable Person and in any
other Persons that have a di-
-17-
rect or indirect interest in the same Power Supply Business or Unrelated
Business does not exceed 40% of the Net Worth of the Company as of the end of
its most recently ended fiscal quarter; (iv) the Person in which the Investment
is made is engaged only in the businesses described in Section 4.4; and (v) the
Company directly or through its Restricted Subsidiaries either (x) controls,
under an operating and management agreement or otherwise, the day to day
management and operation of any Power Supply Business or Unrelated Business of
the Person in which the Investment is made or (y) has significant influence over
the management and operation of any such Power Supply Business or Unrelated
Business in connection with such management or operation. To the extent that an
Investment is not a Permitted Investment only because the aggregate investment
limitation in clause (iii) above is not satisfied, such Investment shall be
treated as a Permitted Investment to the extent of the limitation and any excess
Investment shall be subject to the other restrictions of Section 4.13.
"Permitted Payments" means with respect to the Company or any of its
Restricted Subsidiaries (i) any dividend on shares of Capital Stock payable (or
to the extent paid) solely in shares of Capital Stock (other than Redeemable
Stock) or in options, warrants or other rights to purchase Capital Stock (other
than Redeemable Stock) and any distribution of Capital Stock (other than
Redeemable Capital Stock) in respect of the exercise of any right to convert or
exchange any instrument (whether Debt or equity and including Redeemable Stock);
(ii) any dividend or other distribution payable to the Company by any of its
Restricted Subsidiaries or by a Restricted Subsidiary to another Restricted
Subsidiary; (iii) the repurchase or other acquisition or retirement for value of
any shares of the Company's Capital Stock, or any option, warrant or other right
to purchase shares of the Company's Capital Stock with additional shares of, or
out of the proceeds of a substantially contemporaneous issuance of, Capital
Stock other than Redeemable Stock (unless the redemption provisions of such
Redeemable Stock prohibit the redemption thereof prior to the date on which the
Capital Stock to be acquired or retired was by its terms required to be
redeemed); (iv) any defeasance, redemption, repurchase or other acquisition for
value of any Debt which by its terms ranks pari passu with, or subordinate in
right of payment to the Securities with the proceeds from the issuance of (x)
Debt which is also pari passu with the Securities or subordinate to the
Securities at least to the extent and in the manner as the Debt to be defeased,
redeemed, repurchased or otherwise acquired is subordinate in right of payment
to, the Securities; provided that such new pari passu or subor-
-18-
dinated Debt provides for no payments of principal by way of sinking fund,
mandatory redemption or otherwise (including defeasance) by the Company
(including, without limitation, at the option of the holder thereof other than
an option given to a holder pursuant to a "change of control" or "limitation on
asset sale" covenant which is no more favorable to the holders of such Debt than
the provisions contained in the Debt being replaced or, if none, Sections 4.11
and 4.15) prior to the maturity of Debt being replaced and the proceeds of such
new pari passu or subordinated Debt are utilized for such purpose within 45 days
of issuance or (y) Capital Stock (other than Redeemable Stock); (v) in respect
of any actual payment on account of an Investment which is not fixed in amount
at the time when made, the amount determined by the Board of Directors to be a
Restricted Payment on the date such Investment was originally deemed to have
been made (the "Original Restricted Payment Charge") plus an amount equal to the
interest on a hypothetical investment in a principal amount equal to the
Original Restricted Payment Charge assuming interest at the rate of 7% per annum
compounded annually for a period beginning on the date the Investment was
originally deemed to have been made and ending with respect to any portion of
the Original Restricted Payment Charge actually paid on the date of actual
payment, less any actual payments previously made on account of such Investment;
provided that the Permitted Payment under this clause (v) shall in no event
exceed the payment actually made; (vi) the declaration and payment of dividends
to holders, or any payment on account of the purchase, redemption, retirement or
acquisition for value, of any class or series of Redeemable Stock; or (vii) a
Permitted Investment.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Physical Securities" means those Securities issued pursuant to
Section 2.6(a).
"Power Supply Business" means an electric power or thermal energy
generation or cogeneration facility or related facilities, or electric power
transmission, distribution, fuel supply or fuel transportation facilities, or
any combination thereof, all subject to related security interests under related
project financing arrangements, together with its or their related power supply,
thermal energy and fuel contracts as well as other contractual arrangements with
customers, suppliers and contractors.
-19-
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) of preferred or preference stock of such Person
which is outstanding or issued on or after the date of this Indenture.
"principal" of a Security means the principal amount of, and, unless
the context indicates otherwise, includes any premium payable on, the Security.
"Private Exchange Securities" shall have the meaning set forth in the
Registration Rights Agreement.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person under GAAP.
"Qualified Capital Stock" means any Capital Stock of a Person that is
not Redeemable Stock.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Redeemable Stock" means any class or series of Capital Stock of any
Person that by its terms or otherwise is (i) required to be redeemed prior to
the Stated Maturity of the Securities, (ii) redeemable at the option of the
holder of such class or series of Capital Stock at any time prior to the Stated
Maturity of the Securities or (iii) convertible into or exchangeable for (unless
solely at the option of the Company) Capital Stock referred to in clause (i) or
(ii) above or Debt having a scheduled maturity prior to the Stated Maturity of
the Securities; provided that any Capital Stock that would not constitute
Redeemable Stock but for provisions thereof giving holders thereof the right to
require the Company to repurchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or a "change of control" occurring prior to the
Stated Maturity of the Securities shall not constitute Redeemable Stock if the
"asset sale" or "change of control" provision applicable to such Capital Stock
is no more favorable to the holders of such Capital Stock than the provisions
contained in Sections 4.11 and 4.15, and such Capital Stock specifically
provides that the Company will not repurchase or redeem any such Capital Stock
pursuant to such provisions prior to the Company's repurchase of Securities
required to be repurchased by the Company under Sections 4.11 and 4.15.
-20-
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture and such Security.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture and such Security.
"Reference Period" means the four fiscal quarters for which financial
information is available preceding the date of a transaction giving rise to the
need to make a financial calculation.
"Registrar" has the meaning provided in Section 2.3.
"Registration Rights Agreement" means the Registration Rights
Agreement dated the date hereof among the Company, X.X. Xxxxxx Securities Inc.
and Salomon Brothers Inc.
"Regular Record Date" for the interest payable on any Interest Payment
Date means April 15 or October 15 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.
"Regulation S" means Regulation S promulgated under the Securities Act
(including any successor registration thereto) as it may be amended from time to
time.
"Repurchase Date" shall have the meaning provided in Section 4.11.
"Responsible Officer" when used with respect to the Trustee means any
officer of the Trustee assigned by the Trustee to administer its corporate trust
matters.
"Restricted Payment" means, with respect to any Person, (i) any
dividend or other distribution on any shares of such Person's Capital Stock;
(ii) any payment on account of the purchase, redemption, retirement or
acquisition for value of such Person's Capital Stock; (iii) any defeasance,
redemption, repurchase or other acquisition or retirement for value prior to
scheduled maturity of any Debt subordinated in right of payment to the
Securities and having a maturity date after the maturity of the Securities; (iv)
any Investment in a Restricted Subsidiary after the occurrence of an event of
default, as defined in any indenture or instrument evidencing or under which
such Restricted Subsidiary has at the date of this Indenture or shall thereafter
have outstanding any Debt, shall happen and be
-21-
continuing; (v) any Investment in an Unrestricted Subsidiary; (vi) any
Investment made in an Affiliate (other than a Person that constitutes an
Affiliate solely because of the Company's, or a Restricted Subsidiary of the
Company's, control of such Person) and (vii) the conversion of such Person's
Capital Stock into Debt of such Person or its Restricted Subsidiaries.
Notwithstanding the foregoing, "Restricted Payment" shall not include any
Permitted Payment.
"Restricted Physical Security" means a Physical Security containing a
Securities Act Legend.
"Restricted Subsidiary" means any Subsidiary other than an
Unrestricted Subsidiary.
"Rule 144" shall have the meaning set forth in the Registration Rights
Agreement.
"Rule 144A" shall have the meaning set forth in the Registration
Rights Agreement.
"SEC" means the Securities and Exchange Commission.
"Security" or "Securities" means any Security or Securities, as the
case may be, authenticated and delivered under this Indenture and then
outstanding under the terms of this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Debt" means the principal of (and premium, if any) and
interest on all Debt of the Company whether created, incurred or assumed before,
on or after the date of the issuance of the Securities; provided that Senior
Debt shall not include (i) the Company's 10 1/4% Senior Subordinated Notes due
2006 and 8 3/8% Senior Subordinated Notes due 2007 which rank pari passu to the
Securities and the Notes (in the case of the Debentures) and the Debentures (in
the case of the Notes), (ii) Debt of the Company to any Affiliate, (iii) Debt
that, when incurred and without respect to any election under Section 1111(b) of
Xxxxx 00, Xxxxxx Xxxxxx Code, was without recourse to the Company, (iv) any
other Debt of the Company which by the terms of the instrument creating or
evidencing the same are specifically designated as not being senior in right of
payment to the Securities and (v) Redeemable Stock of the Company.
-22-
"Series" shall mean either the Notes or the Debentures, but not both,
as the context requires.
"Shelf Registration Statement" shall have the meaning set forth in the
Registration Rights Agreement.
"Significant Subsidiary" of a Person means, as of any date, any
Restricted Subsidiary which has two or more of the following attributes: (i) it
contributes 20% or more of such Person's Excess Cash Flow for its most recently
completed fiscal quarter or (ii) it contributes 15% or more of Net Income before
tax of such Person and its Consolidated Subsidiaries for such Person's most
recently completed fiscal quarter or (iii) it constitutes 20% or more of
Consolidated Total Assets of such Person at the end of such Person's most
recently completed fiscal quarter.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 2.10.
"Stated Maturity" means, with respect to any debt security or any
installment of interest thereon, the date specified in such debt security as the
fixed date on which any principal of such debt security or any such installment
of interest is due and payable.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which a majority of the Capital Stock or other ownership
interests having ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at the time directly
or indirectly owned by such Person.
"Subsidiary Guarantors" means (i) prior to the first day, if any, on
which the Company's long-term debt is rated BBB- or higher by Standard & Poor's
Corporation and Baa3 or higher by Xxxxx'x Investors Services, Inc., AES Oklahoma
and AES Hawaii, and (ii) on and after such first day, if any, AES Hawaii.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code xx.xx.
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in
Section 9.3.
"Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by
-23-
such Person or any of its Restricted Subsidiaries arising in the ordinary course
of business in connection with the acquisition of goods or services.
"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article VII and thereafter means such successor.
"Unrelated Business" means any business not of the same general type
now conducted by the Company and its Restricted Subsidiaries.
"Unrestricted Global Securities" means one or more Global Securities
that do not and are not required to bear the Securities Act Legend.
"Unrestricted Physical Securities" means one or more Physical
Securities that do not and are not required to bear the Securities Act Legend.
"Unrestricted Securities" means the Securities that do not and are not
required to bear the Securities Act Legend.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors may designate any Restricted
Subsidiary (including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on any property of, the Company or
any Restricted Subsidiary that is not a Subsidiary of the Subsidiary to be so
designated, provided that (A) any Guarantee by the Company or any Restricted
Subsidiary of any Debt of the Subsidiary being so designated shall be deemed an
"Incurrence" of such Debt and an "Investment" by the Company or such Restricted
Subsidiary (or both, if applicable) at the time of such designation; (B) either
(I) the Subsidiary to be so designated has total assets of $1,000 or less or
(II) if such Subsidiary has assets greater than $1,000, such designation would
be permitted under Section 4.13 and (C) if applicable, the Incurrence of Debt
and the Investment referred to in clause (A) of this proviso would be permitted
under Sections 4.9 and 4.13. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that immediately
after giving effect to such designation (x) all Liens and Debt of such
Unre-
-24-
stricted Subsidiary outstanding immediately after such designation would, if
Incurred at such time, have been permitted to be incurred for all purposes of
this Indenture and (y) no Default or Event of Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced to
the Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing provisions.
"U.S. Government Obligations" means securities which are (i) direct
obligations of the U.S. for the payment of which its full faith and credit is
pledged or (ii) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the U.S. the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the U.S.,
which, in either case, are not callable or redeemable at the option of the
issuer thereof, and shall also include a depository receipt issued by a bank or
trust company as custodian with respect to any such U.S. Government Obligations
or a specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of interest on or principal
of the U.S. Government Obligation evidenced by such depository receipt.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors
of such Person.
"Wholly-Owned Subsidiary" means, with respect to any Person, any
Restricted Subsidiary of such Person if all the Capital Stock or other ownership
interests in such Restricted Subsidiary having ordinary voting power to elect
the entire board of directors or entire group of other persons performing
similar functions (other than any director's qualifying shares or Investments by
foreign nationals mandated by applicable law) is owned directly or indirectly by
such Person.
SECTION 1.2 Incorporation by Reference
of Trust Indenture Act.
---------------------------
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a
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part of this Indenture. The following terms used in this Indenture that are
defined in the TIA have the following meanings:
(a) "Commission" means the SEC;
(b) "indenture securities" means the Securities;
(c) "indenture security holder" means a Securityholder;
(d) "indenture to be qualified" means this Indenture;
(e) "indenture trustee" or "institutional trustee" means the
Trustee; and
(f) "obligor" on the indenture securities means the Company or
any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by reference in the TIA to another statute or defined by the
Securities Act or the Exchange Act and not otherwise defined herein have the
meanings so assigned to them therein.
SECTION 1.3 Rules of Construction.
----------------------
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) words in the singular include the plural, and words in the
plural include the singular;
(d) provisions apply to successive events and transactions;
(e) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section
or other Subdivision; and
(f) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP.
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ARTICLE II
THE SECURITIES
SECTION 2.1 Form and Dating.
---------------
(a) Global Securities. Notes and Debentures offered and sold to QIBs
in reliance on Rule 144A shall be issued initially substantially in the form of
Exhibit A and Exhibit B hereto, respectively, in the name of Cede & Co. as
nominee of DTC, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. Any such Security shall be referred to herein as the "144A
Global Security." Notes and Debentures offered and sold in reliance on
Regulation S shall be issued initially substantially in the form of Exhibit A
and Exhibit B hereto, respectively, in the name of Cede & Co. as nominee of DTC,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. Any such Security shall be referred to herein as the "Regulation S
Global Security." Unrestricted Global Securities shall be issued initially in
accordance with Sections 2.6(b)(iv), 2.6(c)(ii) and 2.6(e) in the name of Cede &
Co. as nominee of DTC, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount of each Global
Security may from time to time be increased or decreased by adjustments made on
the records of the Trustee as hereinafter provided.
Each Global Security shall represent such of the outstanding
Securities as shall be specified therein and each shall provide that it shall
represent the aggregate principal amount of outstanding Securities from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Securities represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and transfers of interests
therein in accordance with the terms of this Indenture. Any change in the
aggregate principal amount of a Global Security to reflect the amount of any
increase or decrease in the principal amount of outstanding Securities
represented thereby shall be made by the Trustee in accordance with reasonable
instructions given by the Holder thereof as required by Section 2.6 hereof and
shall be conclusively reflected on the books and records of the Trustee.
Upon the issuance of the Global Security to DTC, DTC shall credit, on
its internal book-entry registration and transfer system, its Participant's
accounts with the respective
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interests owned by such Participants. Interests in the Global Securities shall
be limited to Participants, including Euroclear and Cedel, and indirect
Participants.
The Participants shall not have any rights either under this Indenture
or under any Global Security with respect to such Global Security held on their
behalf by DTC, and DTC may be treated by the Company, the Trustee and any agent
of the Company or the Trustee as the absolute owner of such Global Security for
the purpose of receiving payment of or on account of the principal of and,
subject to the provisions of this Indenture, interest and Additional Interest,
if any, on the Global Securities and for all other purposes. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by DTC or impair, as between DTC and its
Participants, the operation of customary practices of DTC governing the exercise
of the rights of an owner of a beneficial interest in any Global Security.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel, as in effect from
time to time, shall be applicable to interests in the Regulation S Global
Security that are held by the Participants through Euroclear or Cedel.
(b) Physical Securities. All Securities will initially be issued in
the form of Global Securities pursuant to Section 2.1(a). If Physical Securities
are issued in accordance with Section 2.6(a), the Physical Securities which
represent Notes and the Physical Securities which represent Debentures shall be
issued initially substantially in the form of Exhibit A and Exhibit B hereto,
respectively, in certificated form and issued in the names of the then
beneficial holders thereof (or their nominees), duly executed by the Company and
authenticated by the Trustee as hereinafter provided.
(c) Securities. The provisions of the form of Securities contained in
Exhibit A and Exhibit B hereto are incorporated herein by reference. The Notes
and the Trustee's Certificates of Authentication shall be substantially in the
form of Exhibit A hereto. The Debentures and the Trustee's Certificate of
Authentication shall be substantially in the form of Exhibit B hereto. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule or usage
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and provided to the Trustee in writing by the Company. The Company shall approve
the form of the Securities and any notation, legend or endorsement on them. If
required, the Securities may bear the appropriate legend regarding original
issue discount for federal income tax purposes. Each Security shall be dated the
date of its authentication. The terms and provisions contained in the Securities
shall constitute, and are hereby expressly made, a part of this Indenture.
SECTION 2.2 Execution and Authentication.
-----------------------------
Two Officers of the Company shall sign the Securities for the Company
by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate (i) Initial Securities for original
issue from time to time, (ii) Private Exchange Securities from time to time for
original issue or in exchange for a like principal amount of Initial Securities
and (iii) Unrestricted Securities from time to time for original issue or in
exchange for a like principal amount of Initial Securities, in each case upon a
written order signed by an Officer of the Company. The order shall be based upon
a Board Resolution of the Company and shall specify the amount of Securities to
be authenticated and the date on which the original issue of Securities is to be
authenticated. The order shall also provide instructions concerning
registration, legends, if any, pursuant to Section 2.6(f), amounts for each
Holder and delivery. If Notes or Debentures are to be issued after the date
hereof, then the Company shall deliver Global Securities in the Form of Exhibit
A or Exhibit B hereto, respectively, together with an order for the
authentication and delivery by the Trustee of such Global Security or Securities
and the Trustee shall, in accordance with this Section 2.2, authenticate and
deliver such Global Security or Securities. The Securities shall be issued only
in registered form, without coupons and only in denominations of $1,000 and any
integral multiple thereof.
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SECTION 2.3 Registrar and Paying Agent.
--------------------------
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Securities may be presented for payment ("Paying Agent").
The Company may have one or more additional paying agents. The term "Paying
Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent and shall, if required,
incorporate the provisions of the TIA. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with the provisions of Section 7.7.
The Company initially appoints the Trustee as Registrar and Paying
Agent. The Company shall give written notice to the Trustee in the event that
the Company decides to act as Registrar.
SECTION 2.4 Paying Agent To Hold Money in Trust.
-----------------------------------
The Company shall require each Paying Agent to agree in writing to
hold in trust for the benefit of Securityholders or the Trustee all money held
by the Paying Agent for the payment of principal of or interest on the
Securities (whether such money has been paid to it by the Company or any other
obligor on the Securities), and the Company and the Paying Agent shall each
notify the Trustee of any default by the Company (or any other obligor on the
Securities) in making any such payment. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee and account for any
funds disbursed and the Trustee may at any time during the continuance of any
payment default, upon written request to a Paying Agent, require such Paying
Agent to pay all money held by it to the Trustee and to account for any funds
disbursed. Upon making such payment the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.5 Securityholder Lists.
---------------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is
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not the Registrar, the Company shall furnish to the Trustee at least five
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.
SECTION 2.6 Transfer and Exchange.
----------------------
(a) Transfer and Exchange of Global Securities. Transfer of the Global
Securities shall be by delivery. Global Securities may not be transferred as or
exchanged for Physical Securities except (i) if DTC notifies the Company that it
is unwilling or unable to continue to act as depositary with respect to the
Global Securities or ceases to be a clearing agency registered under the
Exchange Act and, in either case, a successor depositary registered as a
clearing agency under the Exchange Act is not appointed by the Company within
120 days, (ii) at any time if the Company in its sole discretion determines that
the Global Securities (in whole but not in part) should be exchanged for
Physical Securities or (iii) if the owner of an interest in the Global
Securities requests such Physical Securities, following an Event of Default
under this Indenture, in a writing delivered through DTC to the Trustee.
Upon the occurrence of any of the events specified in the previous
paragraph, Physical Securities shall be issued in such names as DTC shall
instruct the Trustee and the Trustee shall cause the aggregate principal amount
of the applicable Global Security to be reduced accordingly and direct DTC to
make a corresponding reduction in its book-entry system. The Company shall
execute and the Trustee shall authenticate and cause to be delivered to the
Person designated in such instructions a Physical Security in the appropriate
principal amount and of the appropriate Series. The Trustee shall deliver such
Physical Securities to the Persons in whose names such Securities are so
registered. Physical Securities issued in exchange for an Initial Global
Security pursuant to this Section 2.6(a) shall bear the Securities Act Legend
and shall be subject to all restrictions on transfer contained therein. Global
Securities may also be exchanged or replaced, in whole or in part, as provided
in Sections 2.7 and 2.8. Every Security authenticated and delivered in exchange
for, or in lieu of, a Global Security or any portion thereof, pursuant to
Section 2.7 or 2.8, shall be authenticated and delivered in the form of, and
shall be, a Global Security. A Global Security may not be exchanged for another
Security other than as provided in this Section 2.6(a).
-31-
(b) Transfer and Exchange of Interests in Global Securities. The
transfer and exchange of interests in Global Securities shall be effected
through DTC, in accordance with this Indenture and the procedures of DTC
therefor. Interests in Initial Global Securities shall be subject to
restrictions on transfer comparable to those set forth herein to the extent
required by the Securities Act. The Trustee shall have no obligation to
ascertain DTC's compliance with any such restrictions on transfer. Transfers of
interests in Global Securities shall also require compliance with subparagraph
(i) below, as well as one or more of the other following subparagraphs as
applicable:
(i) All Transfers and Exchanges of Interests in Global
Securities. In connection with all transfers and exchanges of interests
in Global Securities (other than transfers of interests in a Global
Security to Persons who take delivery thereof in the form of an
interest in the same Global Security), the transferor of such interest
must deliver to the Registrar (1) instructions given in accordance with
the Applicable Procedures from a Participant or an indirect Participant
directing DTC to credit or cause to be credited an interest in the
specified Global Security of the specified Series in an amount equal to
the interest to be transferred or exchanged, (2) a written order given
in accordance with the Applicable Procedures containing information
regarding the Participant account to be credited with such increase and
(3) instructions given by the Holder of the Global Security of the
specified Series to effect the transfer referred to in (1) and (2)
above.
(ii) Transfer of Interests in the Same Initial Global
Security. Interests in any Initial Global Security may be transferred
to Persons who take delivery thereof in the form of an interest in the
same Initial Global Security of the same Series in accordance with the
transfer restrictions set forth in Section 2.6(f) hereof.
(iii) Transfer of Interests to Another Initial Global
Security. Interests in any Initial Global Security may be transferred
to Persons who take delivery thereof in the form of an interest in
another Initial Global Security of the same series if the Registrar
receives the following:
(A) if the transferee will take delivery in the form
of an interest in a 144A Global Security of the same Series,
then the transferor must deliver a cer-
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tificate in the form of Exhibit C hereto, including the
certifications in item 1 thereof; or
(B) if the transferee will take delivery in the form
of an interest in a Regulation S Global Security of the same
Series, then the transferor must deliver a certificate in the
form of Exhibit C hereto, including the certifications in item
2 thereof.
(iv) Transfer and Exchange of Interests in Initial Global
Security for Interests in an Unrestricted Global Security. Interests in
any Initial Global Security may be exchanged by the holder thereof for
an interest in an Unrestricted Global Security of the same Series or
transferred to a Person who takes delivery thereof in the form of an
interest in an Unrestricted Global Security of the same Series if:
(A) such exchange or transfer is effected pursuant to
the Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement; or
(C) the Registrar receives the following:
(1) if the holder of such an interest in an
Initial Global Security proposes to exchange it for
an interest in an Unrestricted Global Security of the
same Series, a certificate from such Holder in the
form of Exhibit D hereto, including the
certifications in item 1(a) thereof;
(2) if the holder of such an interest in an
Initial Global Security proposes to transfer it to a
Person who shall take delivery thereof in the form of
an interest in an Unrestricted Global Security of the
same Series, a certificate in the form of Exhibit C
hereto, including the certification in item 4
thereof; and
(3) in each such case set forth in this
paragraph (C), an Opinion of Counsel in form
reasonably acceptable to the Company and the Trustee,
to the effect that such exchange or transfer is in
compliance with the Securities
-33-
Act and, that the restrictions on transfer contained
herein and in Section 2.6(f) hereof are not required
in order to maintain compliance with the Securities
Act.
If any such transfer is effected pursuant to paragraph (B) above at a
time when an Unrestricted Global Security of the appropriate Series has
not yet been issued, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.2, the Trustee shall
authenticate one or more Unrestricted Global Securities of the
appropriate Series in an aggregate principal amount equal to the
principal amount of interests in the Initial Global Security
transferred pursuant to paragraph (B) above, provided the Company has
made appropriate arrangements with DTC prior to delivery of such an
authentication order to the Trustee.
(v) Notation by the Trustee of Transfer of Interests Among
Global Securities. Upon satisfaction of the requirements for transfer
of interests in Global Securities of the same Series pursuant to
clauses (iii) or (iv) above, the Trustee shall reduce or cause to be
reduced the aggregate principal amount of the relevant Global Security
from which the interests are being transferred, and increase or cause
to be increased the aggregate principal amount of the Global Security
to which the interests are being transferred, in each case, by the
principal amount so transferred and shall direct DTC to make
corresponding adjustments in its book-entry system. No transfer of
interests of a Global Security shall be effected until, and any
transferee pursuant thereto shall succeed to the rights of a holder of
such interests only when, the Registrar has made appropriate
adjustments to the applicable Global Security in accordance with this
paragraph.
(c) Transfer or Exchange of Physical Securities for Interests in a
Global Security.
(i) If any Holder of Physical Securities required to contain
the Securities Act Legend proposes to exchange such Securities for an
interest in a Global Security, then, upon receipt by the Registrar of a
certificate from such Holder in the form of Exhibit D hereto, including
the certifications in item 2 thereof which may be submitted by
facsimile;
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the Trustee shall cancel the Physical Securities, increase or cause to
be increased the aggregate principal amount of, the 144A Global
Security or the Regulation S Global Security of the same Series, as the
case may be, and direct DTC to make a corresponding increase in its
book-entry system.
(ii) A Holder of Physical Securities required to contain the
Securities Act Legend may exchange such Securities for an interest in
an Unrestricted Global Security of the same Series only:
(A) if such exchange or transfer is effected pursuant
to the Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement;
(C) upon receipt by the Registrar of the following
documentation (all of which may be submitted by facsimile):
(1) if the Holder of such Physical
Securities proposes to exchange such Securities for
an interest in an Unrestricted Global Security of the
same Series, a certificate from such Holder in the
form of Exhibit D hereto, including the
certifications in item 1(b) thereof;
(2) an Opinion of Counsel in form reasonably
acceptable to the Company, to the effect that such
exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer
contained herein and in Section 2.6(f) hereof are not
required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a
time when an Unrestricted Global Security of the appropriate Series has
not yet been issued, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 2.2, the Trustee shall
authenticate (i) one or more Unrestricted Global Securities of the
appropriate Series in an aggregate principal amount equal to the
principal amount of Physical Securities transferred pursuant to
paragraph (B) above.
-35-
(d) Transfer and Exchange of Physical Securities.
(i) Transfer of a Physical Security to Another Physical
Security. Following the occurrence of one or more of the events
specified in Section 2.6(a), a Physical Security may be transferred to
Persons who take delivery thereof in the form of another Physical
Security of the same Series if the Registrar receives the following:
(A) if the transfer is being effected pursuant to and
in accordance with Rule 144A, then the transferor must deliver
a certificate in the form of Exhibit C hereto, including the
certifications in item 3(a) thereof; or
(B) if the transfer is being effected pursuant to and
in accordance with Regulation S, then the transferor must
deliver a certificate in the form of Exhibit C hereto,
including the certifications in item 3(b) thereof.
(ii) Transfer and Exchange of Restricted Physical Security
for Physical Security Which Does Not Bear the Securities Act Legend.
Following the occurrence of one or more of the events specified in
Section 2.6(a) and the receipt by the Trustee of an Officers'
Certificate stating that such events have occurred, a Restricted
Physical Security may be exchanged by the Holder thereof for a Physical
Security of the same Series or transferred to a Person who takes
delivery thereof in the form of a Physical Security of the same Series
which does not bear the Securities Act Legend if:
(A) such exchange or transfer is effected pursuant to
the Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the
Shelf Registration Statement in accordance with the
Registration Rights Agreement; or
(C) the Registrar receives a certificate from such
Holder in the form of Exhibit D hereto, including the
certifications in item 1(c) thereof and an Opinion of Counsel
in form reasonably acceptable to the Company, to the effect
that such exchange or transfer is in compliance with the
Securities Act and, that the restrictions on transfer
contained
-36-
herein and in Section 2.6(f) hereof are not required in order
to maintain compliance with the Securities Act.
(iii) Exchange of Physical Securities. When Physical
Securities are presented by a Holder to the Registrar with a request to
register the exchange of such Physical Securities for an equal
principal amount of Physical Securities of the same Series but of other
authorized denominations, the Registrar shall make the exchange as
requested only if the Physical Securities are endorsed or accompanied
by a written instrument of transfer in form satisfactory to the
Registrar duly executed by such Holder or by his attorney duly
authorized in writing and shall be issued only in the name of such
Holder or its nominee. The Physical Securities issued in exchange for
Physical Securities of the same Series shall bear the Securities Act
Legend and shall be subject to all restrictions on transfer contained
herein in each case to the same extent as the Physical Securities so
exchanged.
(iv) Return of Physical Securities. In the event of a
transfer pursuant to clauses (i) or (ii) above and the Holder thereof
has delivered certificates representing an aggregate principal amount
of Securities in excess of that to be transferred, the Company shall
execute and the Trustee shall authenticate and make available for
delivery to the Holder of such Security without service charge, a new
Physical Security or Securities of the same Series of any authorized
denomination requested by the Holder, in an aggregate principal amount
equal to the portion of the Security not so transferred.
(e) Exchange Offer. Upon the occurrence of the Exchange Offer (as
defined in the Registration Rights Agreement) in accordance with the
Registration Rights Agreement, the Company shall issue and, upon receipt of an
Officers' Certificate stating that the Exchange Registration Statement has
become effective and that the Exchange Offer has occurred and an authentication
order in accordance with Section 2.2, the Trustee shall authenticate one or more
Unrestricted Global Securities of the appropriate Series in an aggregate
principal amount equal to the principal amount of the interests in the Initial
Global Securities. Concurrently with the issuance of such Securities, the
Trustee shall cause the aggregate principal amount of the applicable Initial
Global Securities of the appropriate Series to be reduced accordingly and direct
DTC to make a corresponding reduction in its book-entry system.
-37-
In the case that one or more of the events specified in Section 2.6(a)
have occurred, upon the occurrence of such Exchange Offer, the Company shall
issue and, upon receipt of an authentication order in accordance with Section
2.2, the Trustee shall authenticate Unrestricted Physical Securities of the
appropriate Series in an aggregate principal amount equal to the principal
amount of the Restricted Physical Securities tendered for acceptance by persons
participating therein.
(f) Legends.
Each Initial Global Security and, if applicable, each Restricted
Physical Security shall bear the legend (the "Securities Act Legend") in
substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT), OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT WITHIN
TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO AES OR ANY SUBSIDIARY
THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL
BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C)
OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
RULE 904 UNDER THE SECURITIES ACT, (D) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (E) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY
WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY, THE
HOLDER MUST SUBMIT A CERTIFICATE WITH RESPECT TO SUCH TRANSFER TO THE
TRUSTEE (A FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE); AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT. THE
-38-
INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING
RESTRICTIONS.
(g) Global Security Legend. Each Global Security shall bear a legend
in substantially the following form:
"UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC") TO A NOMINEE OF DTC, OR BY ANY SUCH NOMINEE OF DTC,
OR BY DTC TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC). ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.6 OF THE INDENTURE."
(h) Cancellation and/or Adjustment of Global Securities. At such time
as all interests in the Global Securities of a Series have been exchanged for
Physical Securities of the same Series, all Global Securities of that Series
shall be returned to or retained and canceled by the Trustee in accordance with
Section 2.9 hereof. At any time prior to such cancellation, if any interest in a
Global Security is exchanged for an interest in another Global Security or for
Physical Securities of the same Series, the principal amount of Securities
represented by such Global Security shall be reduced accordingly and all such
changes to such Global Security shall be reflected on the books and records of
the Trustee, by the Trustee to reflect such reduction.
-39-
(i) General Provisions Relating to All Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global
Securities of the appropriate Series and, following the occurrence of
one or more of the events specified in Section 2.6(a), Physical
Securities of the appropriate Series upon a written order signed by an
Officer of the Company or at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any stamp or transfer tax or
similar governmental charge payable in connection therewith (other than
any such stamp or transfer taxes or similar governmental charge payable
upon exchange or transfer pursuant to Sections 2.8, 3.8, 4.11 and 4.15
hereof).
(iii) All Global Securities and Physical Securities issued
upon any registration of transfer or exchange of Global Securities or
Physical Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Global Securities or Physical Securities surrendered
upon such registration of transfer or exchange.
(iv) The Company shall not be required (A) to issue, to
register the transfer of or to exchange Securities during a period
beginning at the opening of business 15 days before the day of the
mailing of the notice of redemption of Securities and ending at the
close of business such mailing, (B) to register the transfer of or to
exchange any Security so selected for redemption in whole or in part,
except the unredeemed portion of any Security being redeemed in part or
(C) to register the transfer of or to exchange a Security between a
record date and the next succeeding Interest Payment Date.
(v) Prior to due presentment for the registration of a
transfer of any Security, the Trustee, any Agent and the Company may
deem and treat the Person in whose name any Security is registered as
the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Securities and for all
other purposes, and none of the Trustee, any Agent or the Company shall
be affected by notice to the contrary.
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(vi) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Security (including any transfers
between or among Participants or beneficial owners of interests in any
Global Security) other than to require delivery of such certificates
and other documentation or evidence as are expressly required by, and
to do so if and when expressly required by the terms of, this
Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
SECTION 2.7 Replacement Securities.
-----------------------
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of like tenor, principal amount and Series and bearing a
number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be reasonably required by them to
save each of them and any agent of either of them harmless, then, in the absence
of notice to the Company or the Trustee that such Security has been acquired by
a bona fide purchaser, the Company shall execute and upon its request the
Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or
stolen Security, a new Security of like tenor and principal amount and Series,
having endorsed thereon and bearing a number not contemporaneously outstanding.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of the same Series duly issued hereunder.
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The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.8 Temporary Securities.
---------------------
Pending the preparation of definitive Securities, the Company may
execute and, upon Company Order, the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued, and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities of the same Series upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
10.2, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and make available for delivery in exchange therefor a like
principal amount of definitive Securities of authorized denominations and like
tenor and Series. Until so exchanged the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture as definitive
Securities of the same Series.
SECTION 2.9 Cancellation.
-------------
All Securities surrendered for payment, redemption or registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly canceled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities held by
the Trustee shall be returned to the Company.
-42-
SECTION 2.10 Defaulted Interest.
-------------------
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the date of the proposed
payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Company shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than
15 days prior to the date of the proposed payment. The Company shall
promptly notify the Trustee of such Special Record Date and, in the
name and at the expense of the Company, the Trustee shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to each
Holder at his address as it appears in the Security Register, not less
than five Business Days prior to such Special Record Date. Notice of
the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be
paid not later than the fifteenth day after such Special Record Date to
the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date.
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on
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which the Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this clause, such manner of
payments shall be deemed practicable by the Trustee.
SECTION 2.11 CUSIP or CINS Number.
---------------------
The Company in issuing the Securities may use a "CUSIP" or "CINS"
number, and if so, such CUSIP or CINS number shall be included in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP or CINS number printed in the notice or on the Securities,
and that reliance may be placed only on the other identification numbers printed
on the Securities. The Company will promptly notify the Trustee of any change in
the CUSIP or CINS number.
SECTION 2.12 Payments of Interest.
---------------------
(a) The Holder of a Physical Security at the close of business on the
Regular Record Date with respect to any Interest Payment Date shall be entitled
to receive the interest and Additional Interest, if any, payable on such
Interest Payment Date notwithstanding any transfer or exchange of such Physical
Security subsequent to the regular record date and prior to such Interest
Payment Date, except if and to the extent the Company shall default in the
payment of the interest or Additional Interest due on such Interest Payment
Date, in which case such Defaulted Interest and Additional Interest, if any,
shall be paid in accordance with Section 2.10; provided that, in the event of an
exchange of a Physical Security for a beneficial interest in any Global Security
subsequent to a Regular Record Date or any Special Record Date and prior to or
on the related Interest Payment Date or other payment date under Section 2.10,
any payment of the interest and Additional Interest payable on such payment date
with respect to any such Physical Security shall be made to the Person in whose
name such Physical Security was registered on such record date. Payments of
interest on the Global Securities will be made to the Holder of the Global
Security on each Interest Payment Date; provided that, in the event of an
exchange of all or a portion of a Global Security for Physical Security
subsequent to the Regular Record Date or any Special Record Date and prior to or
on the related Interest Payment Date or other payment date under Section 2.10
any payment of interest or Additional Interest payable on such Interest Payment
Date or other payment
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date with respect to the Physical Security shall be made to the Holder of the
Global Security.
(b) The Trustee shall pay interest and Additional Interest, if any, to
DTC, with respect to any Global Security held by DTC, on the applicable Interest
Payment Date in accordance with instructions received from the Company at least
five Business Days before the applicable Interest Payment Date. The Company
shall deliver such instructions in the form of an Officers' Certificate setting
forth Additional Interest in the aggregate and per $1,000 principal amount of
Securities to be paid on such Interest Payment Date.
SECTION 2.13 Outstanding Securities.
-----------------------
Securities outstanding at any time are all Securities that have been
authenticated by the Trustee except for those canceled by it, those delivered to
it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Company or one of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds on a redemption date or Maturity Date money
sufficient to pay the principal of, and interest on Securities payable on that
date, then on and after that date such Securities cease to be outstanding and
interest on them ceases to accrue.
SECTION 2.14 Treasury Securities.
--------------------
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, any Subsidiary or any of their respective Affiliates shall be
disregarded, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded.
The Trustee may require an Officers' Certificate listing securities
owned by the Company, any Subsidiary or any of their respective Affiliates.
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ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.1 Right of Redemption.
--------------------
The Securities may be redeemed at the election of the Company as
provided by the terms of the Securities, as a whole or from time to time in
part, at the times and at the Redemption Prices specified in the form of
Security set forth in Exhibit A and Exhibit B together with any applicable
accrued interest to the Redemption Date.
SECTION 3.2 Applicability of Article.
-------------------------
Redemption of Securities at the election of the Company, as permitted
by the Securities or any provision of this Indenture, shall be made in
accordance with such provision and this Article.
SECTION 3.3 Election To Redeem; Notice to Trustee.
--------------------------------------
The election of the Company to redeem any Securities pursuant to
Section 3.1 shall be evidenced by a Board Resolution of the Company delivered to
the Trustee. The Company shall, at least 30 days prior to the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee) notify the Trustee of such Redemption Date and of the principal amount
of Securities to be redeemed.
SECTION 3.4 Selection by Trustee of
Securities To Be Redeemed.
--------------------------
If less than all the Securities of a Series are to be redeemed, the
particular Securities to be redeemed shall be selected by the Trustee, from all
outstanding Securities of a Series not previously called for redemption, by such
method as the Trustee shall deem fair and appropriate and which may provide for
the selection for redemption of portions (equal to $1,000 or any integral
multiple thereof) of the principal amount of Securities of a denomination larger
than $1,000.
The Trustee shall promptly notify the Company and the Registrar in
writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.
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For all purposes of this Indenture, all provisions relating to the
redemption of Securities shall relate, in the case of any Securities redeemed or
to be redeemed only in part, to the portion of the principal amount of such
Securities which has been or is to be redeemed.
SECTION 3.5 Notice of Redemption.
---------------------
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the outstanding Securities of a Series
are to be redeemed, the identification including CUSIP numbers, (and,
in the case of partial redemption, the principal amounts) of the
particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security to be redeemed and that,
unless the Company shall default in the payment of the Redemption Price
and any applicable accrued interest, interest thereon will cease to
accrue on and after said date, and
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 3.6 Deposit of Redemption Price.
----------------------------
On or prior to 10:00 a.m. New York City time on any Redemption Date,
the Company shall deposit with the Trustee or with a Paying Agent an amount of
money sufficient to pay the Redemption Price of and accrued interest on all the
Securities which are to be redeemed on that date.
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SECTION 3.7 Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and any applicable
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Paying Agent at the Redemption Price, together
with any applicable accrued interest to the Redemption Date.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) and
accrued interest on such unpaid principal shall, until paid, bear interest from
the Redemption Date at the rate provided by the Security.
SECTION 3.8 Sinking Fund.
-------------
(a) As and for a sinking fund for the retirement of the Debentures, the
Company covenants and agrees that (so long as any of the Debentures are
outstanding) it will, no later than 10:00 a.m. on each November 1st commencing
with the year 2008 to and including the year 2026 (each such November 1st being
herinafter referred to as a "Mandatory Sinking Fund Redemption Date"), deposit
with the Trustee or any Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust), a sum in cash sufficient to redeem
on each such November 1st $6,250,000 aggregate principal amount of the
Debentures (subject to adjustment as provided in paragraph (b)) at a price equal
to 100% of the principal amount thereof plus accrued interest (not otherwise
paid or provided to be paid on or before the Redemption Date); provided,
however, that the sinking fund requirement for any year shall never exceed the
principal amount of Notes at the time outstanding. Each sum payable as provided
in this Secton 3.9 is herein called a "Mandatory Sinking Fund Payment Amount".
(b) The Mandatory Sinking Fund Payment Amount shall be subject to
adjustment in the event that on or prior to any Mandatory Sinking Fund
Redemption Date the Company delivers or causes to be delivered to the Trustee
for cancellation Debentures with an aggregate principal amount in excess of the
Mandatory Sinking Fund Payment Amount for such next succeeding Mandatory Sinking
Fund Redemption Date, in which case the Mandatory Sinking Fund Payment Amount
applicable to each Mandatory
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Sinking Fund Redemption Date after the next succeeding Mandatory Sinking Fund
Redemption Date shall be adjusted to be the quotient obtained by dividing (i)
the aggregate principal amount of Debentures outstanding after giving effect to
such cancellation by (ii) the number of remaining Mandatory Sinking Fund
Redemption Dates including the next succeeding Mandatory Sinking Fund Redemption
Date.
SECTION 3.9 Selection of Debentures.
------------------------
The Trustee shall select and call for redemption on each Mandatory
Sinking Fund Redemption Date, on a pro rata basis, such an aggregate principal
amount of outstanding Debentures as will exhaust the Mandatory Sinking Fund
Payment Amount, as nearly as in the opinion of the Trustee may be practical, at
the redemption price of 100% of the principal amount thereof plus interest
accrued to the Redemption Date, and the Company shall cause notice of redemption
of such Debentures on such Mandatory Sinking Fund Redemption Date to be give in
the name of the Company and in the manner provided in Section 3.5 for the
redemption of Securities in part at the option of the Company except that the
notice of redemption shall also state that the Debentures are being redeemed
pursuant to the operation of the sinking fund; and on and after such Mandatory
Sinking Fund Redemption Date, if the necessary funds have been deposited with
it, the Trustee shall apply or cause to be applied such sinking fund monies in
the manner provided in Section 3.7 to the redemption of the Securities so
selected.
SECTION 3.10 Credit for Debentures Previously Acquired.
------------------------------------------
Notwithstanding any provision of Section 3.8 calling for payment of the
Mandatory Sinking Fund Payment Amount in cash, the Company at its option in
satisfaction of all or any part of any Mandatory Sinking Fund Payment Amount
may, from time to time, by delivering to the Trustee not less than 45 days prior
to the date of such Mandatory Sinking Fund Redemption Date, in lieu of paying
all or any part of any Mandatory Sinking Fund Payment Amount in cash, Debentures
for cancellation previously authenticated and delivered by the Trustee which
were acquired during the 12-month period preceding such Mandatory Sinking Fund
Redemption Date.
The Debentures to be credited pursuant to this Section 3.10 shall be
accompanied by an Officers' Certificate which shall specify (i) the amount of
such Mandatory Sinking Fund Payment Amount to be made in cash and (ii) the
aggregate
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principal amount of Debentures being delivered and credited against payment
pursuant to this Section 3.10 and confirming that no Default in the payment of
interest of the Debentures or Event of Default has occurred and is continuing.
SECTION 3.11 Securities Redeemed in Part.
----------------------------
Upon surrender of a Security that is redeemed in part (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Security so surrendered.
ARTICLE IV
COVENANTS
SECTION 4.1 Payment of Securities.
----------------------
The Company shall pay the principal of and interest on the Notes and
Debentures on the dates and in the manner provided in the Notes and Debentures,
respectively, and this Indenture.
An installment of principal or interest shall be considered paid on the
date due if the Trustee or Paying Agent (other than the Company or any
Subsidiary of the Company or any Affiliate of any thereof) holds on such date by
10:00 a.m., New York City time, immediately available funds designated for and
sufficient to pay such installment.
The Company shall pay interest on overdue principal and on overdue
installments of interest, in each case at the rate per annum specified in the
Notes and Debentures, respectively, to the extent lawful.
SECTION 4.2 Maintenance of Office or Agency.
-------------------------------
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency, where Securi-
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ties may be surrendered for registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The Company will
give prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 10.2.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations,
provided that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes. The Company will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Company hereby initially designates the offices of the Trustee as
set forth in Section 10.2 as an agency of the Company in accordance with Section
2.3.
SECTION 4.3 Corporate Existence.
--------------------
Subject to Article V hereof, the Company shall do or cause to be done,
at its own cost and expense, all things necessary to preserve and keep in full
force and effect the corporate existence and rights (charter and statutory),
licenses and/or franchises of the Company, provided that the Company shall not
be required to preserve any such right, license or franchise, if in the
reasonable and good faith judgment of the Board of Directors of the Company (i)
such preservation or existence is not desirable in the conduct of business of
the Company and (ii) the loss of such right, license or franchise is not adverse
in any material respect to the Holders or to the Company or the ability of the
Company to satisfy its obligations hereunder.
SECTION 4.4 Limitation on Business.
-----------------------
The Company (a) shall continue, and shall cause each Material AES
Entity to continue, to engage in business of the same general type as now
conducted by the Company and its Re-
-51-
stricted Subsidiaries and (b) shall continue, and shall cause each Material AES
Entity to continue, to operate its and their respective businesses on a basis
substantially consistent with the policies and standards of the Company or such
Material AES Entity as in effect on the Closing Date.
SECTION 4.5 Limitation on Restricted Subsidiary
Investments and Mergers.
------------------------
The Company shall not permit any Restricted Subsidiary with any direct
or indirect interest in a Power Supply Business to make any Investment in, or to
consolidate or merge with, any other Person with a direct or indirect interest
in any other Power Supply Business or any Unrelated Business. In addition, the
Company will not permit any Restricted Subsidiary with any direct or indirect
interest in any Unrelated Business to make any Investment in, or to consolidate
or merge with, any other Person with a direct or indirect interest in any Power
Supply Business or any other Unrelated Business. The Company's obligation to
comply with this covenant shall terminate if and when the Securities become
Investment Grade.
The foregoing restrictions shall not apply to any Intermediate Holding
Company; provided that (i) each such Intermediate Holding Company's direct and
indirect interest in any Power Supply Business or Unrelated Business shall be
limited to the ownership of Capital Stock or Debt obligations of a Person with a
direct or indirect interest in such Power Supply Business or Unrelated Business;
(ii) no Intermediate Holding Company shall incur, assume, create or suffer to
exist any Debt (including any Guarantee of Debt) other than Debt to the Company
or Debt permitted under clauses (iii), (viii) and (xi) of Section 4.9(b); and
(iii) no Lien shall exist upon any assets of such Intermediate Holding Company
whether now or hereafter acquired, except for Liens upon the Capital Stock of a
Restricted Subsidiary of an Intermediate Holding Company securing Debt of such
Restricted Subsidiary and Liens securing Debt permitted under clauses (iii) and
(xi) of Section 4.9(b).
SECTION 4.6 Compliance Certificates.
------------------------
The Company shall furnish to the Trustee annually, on or before a date
not more than four months after the end of its fiscal year (which, on the date
hereof, is a calendar year), a brief certificate (which need not contain the
statements required by Section 10.4) from its principal executive, financial or
accounting officer as to his or her knowledge of the compliance of the Company
with all conditions and covenants under
-52-
this Indenture (such compliance to be determined without regard to any period of
grace or requirement of notice provided under this Indenture) which certificate
shall comply with the requirements of the TIA.
SECTION 4.7 Reports.
--------
So long as any Security is outstanding, the Company shall file with the
SEC the annual reports, quarterly reports and the information, documents and
other reports required to be filed by the Company with the SEC pursuant to
Sections 13 and 15(d) of the Exchange Act, whether or not the Company has or is
required to have a class of securities registered under the Exchange Act, at the
time it is or would be required to file the same with the SEC and within 15 days
after it is or would be required to file such reports, information or documents
with the SEC shall mail such reports, information and documents to the Holders
at their addresses set forth in the Register of Securities maintained by the
Registrar and the Trustee. The Company also shall comply with the other
provisions of TIA ss. 314(a). Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 4.8 Limitation on Debt.
-------------------
(a) The Company shall not Incur any Debt, including Acquisition Debt,
unless after giving effect to the Incurrence of such Debt and the receipt and
application of the proceeds therefrom, the Fixed Charge Ratio of the Company
would be greater than 2 to 1. The Company's obligation to comply with this
covenant will terminate if and when the Notes become Investment Grade.
(b) Notwithstanding the foregoing, the Company may Incur each and all
of the following:
(i) Debt under or in respect of the Bank Credit Agreement in
an aggregate principal amount at any one time outstanding not to exceed
$600 million;
(ii) Debt issued in exchange for, or the proceeds of which
are used to refinance, outstanding Securities or other Debt of the
Company in an amount (or, if such new
-53-
Debt provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration thereof, with an
original issue price) not to exceed the amount so exchanged or
refinanced (plus accrued interest, premium, if any, and fees and
expenses related to such exchange or refinancing); provided that (A)
the date of any scheduled payment of principal by way of sinking fund,
mandatory redemption or otherwise (including defeasance) on any Debt so
refinanced or exchanged otherwise due after the final scheduled
Maturity Date of the Securities shall not occur prior to such Maturity
Date as a result of such exchange or refinancing and (B) new Debt the
proceeds of which are used to exchange or refinance the Securities or
other Debt of the Company that is subordinated in right of payment to
the Securities shall only be permitted under this clause (ii) if (x) in
case the Securities are exchanged or refinanced in part, such new Debt,
by its terms or by the terms of any agreement or instrument pursuant to
which such Debt is issued, is expressly made pari passu with, or
subordinate in right of payment to, the remaining Securities, (y) in
case the Debt to be exchanged or refinanced is subordinated in right of
payment to the Securities, such new Debt, by its terms or by the terms
of any agreement or instrument pursuant to which such Debt is issued,
is expressly made subordinate in right of payment to the Securities, at
least to the extent that the Debt to be exchanged or refinanced is
subordinated in right of payment to the Securities and (z) in case the
Securities are exchanged or refinanced in part or the Debt to be
exchanged or refinanced is subordinated in right of payment to the
Securities, as of the date the new Debt is Incurred, the Average Life
of the new Debt shall be equal to or greater than the Average Life of
the Securities or Debt to be exchanged or refinanced;
(iii) Debt of the Company to any of its Consolidated
Subsidiaries, except that any transfer of such Debt by a Consolidated
Subsidiary (other than to another Consolidated Subsidiary) will be
deemed to be an Incurrence of Debt; provided that such Debt is
expressly subordinated in right of payment to the Securities; and
(iv) Debt in an aggregate principal amount not to exceed $50
million at any one time outstanding.
(c) For purposes of determining any particular amount of Debt
under this Section 4.8, Guarantees of, or obligations with respect to letters of
credit supporting, Debt oth-
-54-
erwise included in the determination of such particular amount shall not be
included. For purposes of determining compliance with this Section 4.8, (A) in
the event that an item of Debt meets the criteria of more than one of the types
of Debt described in the above clauses, the Company, in its sole discretion,
shall classify such item of Debt and only be required to include the amount and
type of such Debt in one of such clauses and (B) the amount of Debt issued at a
price that is less than the principal amount thereof shall be equal to the
amount of the liability in respect thereof determined in conformity with GAAP.
SECTION 4.9 Limitation on Restricted
Subsidiary Debt.
----------------
(a) The Company shall not permit any Restricted Subsidiary to Incur,
directly or indirectly, any Debt, including Acquisition Debt. The Company's
obligation to comply with this covenant will terminate if and when the
Securities become Investment Grade.
(b) Notwithstanding the foregoing, each and all of the following Debt
may be Incurred by a Restricted Subsidiary:
(i) Debt outstanding as of the Closing Date;
(ii) Debt Incurred for any purpose (including without
limitation the purposes set forth in clause (iii) below) to the extent
of the amount thereof that is also Debt of the Company and is permitted
under Section 4.8;
(iii) Debt Incurred to finance the development, acquisition,
construction, maintenance, working capital requirements in the ordinary
course of business consistent with past practice or operation of a
Power Supply Business or Unrelated Business in which the Company or any
Restricted Subsidiary has a direct or indirect interest; provided that
(a) such Debt shall be permitted under this clause (iii) only to the
extent of the amount thereof which (x) is Non-Recourse to the Company
and (y) is Non-Recourse to any other Restricted Subsidiary of the
Company other than Restricted Subsidiaries which represented less than
33% of the Consolidated EBITDA of the Company for the Reference Period,
and (b) upon the commencement of commercial operations of such Power
Supply Business or, in the case of an acquisition of such Power Supply
Business or Unrelated Business, upon the date of such acquisition, the
Company directly or through its Restricted Subsidiaries
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either (x) controls, under an operating and management agreement or
otherwise, the day to day management and operation of the Power Supply
Business or Unrelated Business so financed or (y) has significant
influence over the management and operation of such Power Supply
Business or Unrelated Business;
(iv) Debt issued in exchange for, or the proceeds of which
are used to refinance, outstanding Debt of such Restricted Subsidiary
otherwise permitted under the Indenture in an amount (or, if such new
Debt provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration thereof, with an
original issue price) not to exceed the amount so exchanged or
refinanced (plus accrued interest, premium, if any, and fees and
expenses related to such exchange or refinancing plus any principal
amounts previously repaid); provided that (a) the new Debt shall be
Non-Recourse to the Company to the same extent as the Debt to be
exchanged or refinanced, (b) if such Restricted Subsidiary has a direct
or indirect interest in any Power Supply Business or Unrelated
Business, the new Debt shall be Non-Recourse to any other Restricted
Subsidiary of the Company other than Restricted Subsidiaries which
represented less than 33% of the Consolidated EBITDA of the Company for
the Reference Period, (c) the date of any scheduled payment of
principal by way of sinking fund, mandatory redemption or otherwise
(including defeasance) on any Debt so refinanced or exchanged otherwise
due after the final scheduled Maturity Date of the Securities shall not
occur prior to such Maturity Date as a result of such exchange or
refinancing and (d) if the new Debt refinances principal amounts
previously repaid, (x) such new Debt shall be permitted only if on the
date such new Debt is Incurred, the Company could incur at least $1 of
Debt under Section 4.8(a) and (y) the proceeds from such new Debt are
not to be used to make any Restricted Payments;
(v) Guarantees of Debt of the Company under the Bank Credit
Agreement;
(vi) Debt Incurred to support the performance obligations of a
Restricted Subsidiary engaged in providing construction management or
operating services to a Power Supply Business; provided that (a) such
Debt shall be permitted under this clause (vi) only to the extent of
the amount thereof which is Non-Recourse to the Company and is
Non-Recourse to any other Restricted Subsidiary of the
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Company other than Restricted Subsidiaries which represented less than
33% of the Consolidated EBITDA of the Company for the Reference Period,
and (b) upon the commencement of commercial operation of such Power
Supply Business or in the case of an acquisition of such Power Supply
Business, upon the date of such acquisition, the Company directly or
through its Restricted Subsidiaries either (x) controls, under an
operating and management agreement or otherwise, the day to day
management and operation of such Power Supply Business or (y) has
significant influence over the management and operation of such Power
Supply Business;
(vii) Debt in an aggregate amount for all Restricted
Subsidiaries at any one time outstanding of not more than $50 million
Incurred to finance the on-going operation, but not any expansion or
improvement, of a Power Supply Business or Unrelated Business in which
such Restricted Subsidiary has a direct or indirect interest; provided
that such Debt shall be permitted under this clause (vii) only to the
extent it is Non-Recourse to the Company and to any other Restricted
Subsidiary of the Company other than Restricted Subsidiaries which
represented less than 33% of the Consolidated EBITDA of the Company for
the Reference Period;
(viii) Debt of any Restricted Subsidiary of the Company owed
to (A) the Company or (B) any Restricted Subsidiary of the Company;
(ix) Debt in respect of Currency Agreements or Interest Rate
Agreements;
(x) Debt that is Non-Recourse to the Company and Non-Recourse
to any other Restricted Subsidiary of the Company other than Restricted
Subsidiaries which represented less than 33% of the Consolidated EBITDA
of the Company for the Reference Period, only to the extent that the
proceeds of such Debt are received by the Company or an Intermediate
Holding Company as a result of such proceeds being used to pay
dividends or make distributions on the Capital Stock of such Restricted
Subsidiary and any other Restricted Subsidiary in the chain of
ownership between the Company or such Intermediate Holding Company and
such Restricted Subsidiary;
(xi) Acquisition Debt and Debt incurred to finance the
acquisition of a Power Supply Business; provided that
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such Acquisition Debt and other Debt is Non-Recourse to the Company or
any Person that was a Restricted Subsidiary of the Company immediately
prior to such Incurrence; and provided further that where any Debt is
incurred to finance the acquisition of more than one Power Supply
Business, all such acquisitions shall have occurred within 180 days of
each other; and
(xii) Debt of the type described in clause (iii) of the
definition thereof the Incurrence of which causes a corresponding
reduction in any debt service or other similar cash reserve required to
be maintained in connection with any Debt of such Restricted Subsidiary
permitted by clause (iii) above and (to the extent that the same
constitutes a refinancing of Debt permitted under such clause (iii)),
clause (iv) above, in each case, only to the extent that the proceeds
from such reserve reduction are received by the Company or an
Intermediate Holding Company as a result of such proceeds being used to
pay dividends or make distributions on the Capital Stock of such
Restricted Subsidiary and any other Restricted Subsidiary in the chain
of ownership between the Company or such Intermediate Holding Company
and such Restricted Subsidiary.
(c) For purposes of determining compliance with this Section 4.9, (A)
in the event that an item of Debt meets the criteria of more than one of the
types of Debt described in the above clauses, the Company, in its sole
discretion, shall classify such item of Debt and only be required to include the
amount and type of such Debt in one of such clauses and (B) the amount of Debt
issued at a price that is less than the principal amount thereof shall be equal
to the amount of the liability in respect thereof determined in conformity with
GAAP.
SECTION 4.10 Limitation on Additional Tiers of
Senior Subordinated Debt.
-------------------------
The Company shall not Incur or suffer to exist any Debt, other than
Debt evidenced by the Securities, that is subordinate in right of payment to any
Senior Debt unless such Debt, by its terms or the terms of the instrument
creating or evidencing it, is pari passu with, or subordinate in right of
payment to, the Securities; provided that any Debt of the Company or any of its
Restricted Subsidiaries which is outstanding on the Closing Date shall be
excluded from the operation of this covenant.
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SECTION 4.11 Change of Control.
------------------
(a) Upon a Change of Control, each Holder of the Securities shall have,
subject to Article XI, the right to require that the Company repurchase such
Holder's Securities at a repurchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to the date of
repurchase in accordance with Section 4.11(b) hereof.
(b) Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder of the Securities at their last registered
addresses with a copy to the Trustee stating:
(1) that a Change of Control has occurred and that such Holder
has the right to require the Company to repurchase such Holder's
Securities at a repurchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest, if any, to the date of
repurchase (the "Change of Control Offer");
(2) the circumstances and relevant facts regarding such Change
of Control (including information with respect to pro forma historical
income, cash flow and capitalization after giving effect to such Change
of Control);
(3) the repurchase date (which shall be not earlier than 30
days or later than 60 days from the date such notice is mailed and
which shall be the same date for the Notes, if then outstanding, and
the Debentures), (the "Repurchase Date");
(4) that any Security not tendered will continue to accrue
interest;
(5) that any Security accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the
Repurchase Date;
(6) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Repurchase Date;
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(7) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the close of business on
the third Business Day (or such shorter periods as may be required by
applicable law) preceding the Repurchase Date, a facsimile transmission
or letter setting forth the name of the Holder, the principal amount of
Securities the Holder delivered for purchase, and a statement that such
Holder is withdrawing his election to have such Securities purchased;
and
(8) that Holders which elect to have their Securities
purchased only in part will be issued new Securities in a principal
amount equal to the unpurchased portion of the Securities surrendered.
(c) On the Repurchase Date, the Company shall:
(i) accept for payment Securities or portions thereof
tendered pursuant to the Change of Control Offer;
(ii) deposit by 10:00 a.m., New York City time, with the
Trustee money sufficient to pay the purchase price of all Securities
or portions thereof so tendered; and
(iii) deliver or cause to be delivered to the Trustee
Securities so accepted together with an Officers' Certificate
identifying the Securities or portions thereof tendered to the
Company.
The Trustee shall promptly mail to the Holders of the Securities so
accepted payment in an amount equal to the purchase price, and promptly
authenticate and make available for delivery to such Holders a new Security of
the same Series in a principal amount equal to any unpurchased portion of the
Security surrendered. The Company will publicly announce the results of the
Change of Control Offer on or as soon as practicable after the Repurchase Date.
The Company shall comply with all applicable tender offer rules,
including without limitation, Rule 14e-1 under the Exchange Act, in connection
with a Change of Control Offer.
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SECTION 4.12 Limitation on Transactions
with Affiliates.
----------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly enter into any transaction (including,
without limitation, the sale, purchase or lease of any assets or properties or
the rendering of any services) involving aggregate consideration in excess of $5
million with any Affiliate (other than a Person that constitutes an Affiliate
solely because of the Company's or a Subsidiary of the Company's control of such
Person except for any Unrestricted Subsidiary) or holder of 5% or more of any
class of Capital Stock of the Company except for transactions (including,
subject to Section 4.13, any loans or advances by or to, or Guarantee on behalf
of, any Affiliate or any such holder) made in good faith the terms of which are
fair and reasonable to the Company or such Restricted Subsidiary, as the case
may be, and are at least as favorable as the terms which could be obtained by
the Company or such Restricted Subsidiary, as the case may be, in a comparable
transaction made on an arm's-length basis with Persons who are not such a holder
or Affiliate; provided that any such transaction shall be conclusively deemed to
be on terms which are fair and reasonable to the Company or any of its
Restricted Subsidiaries and on terms which are at least as favorable as the
terms which could be obtained on an arm's-length basis with Persons who are not
such a holder or Affiliate if such transaction is approved by a majority of the
Company's directors (including a majority of the Company's independent
directors); and provided further, that with respect to the purchase or
disposition of assets of the Company or any of its Restricted Subsidiaries
having a net book value in excess of $15 million, in addition to approval of its
Board of Directors, the Company shall obtain a written opinion of an Independent
Financial Advisor stating that the terms of such transaction are fair to the
Company or its Restricted Subsidiary, as the case may be, from a financial point
of view; and provided further that the fairness, reasonableness and arm's-length
nature of the terms of any transaction which is part of a series of related
transactions may be determined on the basis of the terms of the series of
related transactions taken as a whole. This Section 4.12 shall not apply to (a)
transactions between the Company or any of its Restricted Subsidiaries and any
employee of the Company or any of its Restricted Subsidiaries that are approved
by the Board of Directors or any committee of the Board of Directors consisting
of the Company's independent directors, (b) the payment of reasonable and
customary regular fees to directors of the Company or a Restricted Subsidiary,
(c) any transaction between the Com-
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pany and any of its Consolidated Subsidiaries or between any of its Consolidated
Subsidiaries, (d) any Permitted Payment and any Restricted Payment not otherwise
prohibited by Section 4.13 or (e) the provision of general corporate
administrative, operating and management services, including, without
limitation, procurement, construction engineering, construction administration,
legal, accounting, financial, money management, risk management, personnel,
administration and business planning services, in each case, in the ordinary
course.
SECTION 4.13 Limitation on Restricted Payments.
----------------------------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, make any Restricted Payment if after giving effect
to such Restricted Payment:
(a) an Event of Default or event that, after the giving of
notice or lapse of time or both would become an Event of Default,
shall have occurred and be continuing;
(b) the Company could not Incur at least $1 of Debt under
Section 4.8(a); or
(c) the aggregate amount expended by the Company and its
Restricted Subsidiaries for all Restricted Payments (the amount of any
single or related series of Restricted Payments so expended or
distributed, if in excess of $15 million and other than in cash, to be
determined in good faith by the Board of Directors, as evidenced by a
Board resolution) after April 1, 1997 shall exceed the sum of:
(1) 50% of the Net Income of the Company and its
Consolidated Subsidiaries for the period (taken as one
accounting period) beginning on April 1, 1997 and ending on
the last day of the fiscal quarter for which financial
information is available immediately prior to the date of such
calculation; provided that if Net Income for such period is
less than zero, then minus 100% of such net loss; plus
(2) the aggregate net proceeds (including the fair
market value of proceeds other than cash, as determined in
good faith by the Board of Directors, as evidenced by a Board
Resolution if the fair market value of such non-cash proceeds
is in excess of $15 million) received by (A) the Company from
and after April 1, 1997 from the issuance and sale (other than
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to a Restricted Subsidiary) of its Capital Stock (excluding
Redeemable Stock, but including Capital Stock other than
Redeemable Stock issued upon conversion of, or in exchange
for, Redeemable Stock or securities other than its Capital
Stock), and warrants, options and rights to purchase its
Capital Stock (other than Redeemable Stock), but excluding the
net proceeds from the issuance, sale, exchange, conversion or
other disposition of its Capital Stock convertible (unless
solely at the option of the Company) into (x) any security
other than its Capital Stock or (y) its Redeemable Stock or
(B) a Finance Subsidiary of the Company from and after April
1, 1997 from the issuance and sale (other than to the Company
or a Restricted Subsidiary) of its Qualified Capital Stock;
plus
(3) to the extent not included in clause (1) above,
the net reduction in Investments of the type specified in
clauses (iv) through (vi) of the definition of Restricted
Payment resulting from payments of interest on Debt,
dividends, repayments of loans or advances, or other transfers
of assets to the Company or other Person that made the
original Investment from the Person in which such Investment
was made or resulting from the sale or disposition of the
Investment or other return of the amount of the Investment or
from the redesignation of any Unrestricted Subsidiary as a
Restricted Subsidiary; provided that such payment, for
purposes of the calculation to be made pursuant to this clause
(3), shall not exceed the amount of the original Investment;
plus
(4) any amount previously included as a Restricted
Payment on account of an obligation by the Company or any
Restricted Subsidiary to make a Restricted Payment which has
not actually been made by the Company or any Restricted
Subsidiary and which is no longer required to be paid by the
Company or any Restricted Subsidiary; plus
(5) $502 million;
provided that the foregoing clause (c) shall not prevent the payment of any
dividend within 60 days after the date of its declaration if such dividend could
have been made on the date of its declaration without violation of the
provisions of this Section 4.13.
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For purposes of clause (c)(2) above, the aggregate net proceeds
received by the Company (x) from the issuance of its Capital Stock upon the
conversion of, or exchange for, securities evidencing Debt of the Company, shall
be calculated on the assumption that the gross proceeds from such issuance are
equal to the aggregate principal amount (or, if discount Debt, the accreted
principal amount) of the Debt evidenced by such securities converted or
exchanged and (y) upon the conversion or exchange of other securities of the
Company shall be equal to the aggregate net proceeds of the original sale of the
securities so converted or exchanged if such proceeds of such original sale were
not previously included in any calculation for the purposes of clause (c)(2)
above plus any additional sums payable upon conversion or exchange.
The Company's obligation to comply with this covenant shall terminate
if and when the Securities become Investment Grade.
If an Investment which the Company or any Restricted Subsidiary is
obligated to make either in part from time to time or in whole in the future is
fixed in amount by the agreement setting forth such obligation, for purposes of
determining whether such Investment is a Restricted Payment permitted under this
Section 4.13 or is a Permitted Payment, the Investment shall be deemed to have
been made only once, in the amount so fixed, at the time the obligation first
arises (and not when payments in respect thereof are later made). If an
Investment which the Company or any Restricted Subsidiary is obligated to make
either in part from time to time or in whole in the future is not fixed in
amount by the agreement setting forth such obligation, for purposes of
determining whether such Investment is a Restricted Payment permitted under this
Section 4.13 or is a Permitted Payment, the Investment shall be deemed to have
been made at the time the obligation first arises in an amount to be determined
in good faith by the Board of Directors, as evidenced by a Board Resolution, and
any actual payments in respect of such Investment shall be deemed to be
Investments made on the date of payment thereof. Subject to the terms of clause
(v) of the definition of Permitted Payments, such later Investments may be
Permitted Payments.
SECTION 4.14 Limitation on Dividend and other
Payment Restrictions Affecting
Subsidiaries.
-------------
The Company shall not, and shall not permit any Restricted Subsidiary
to, create or otherwise cause or suffer to
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exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Restricted Subsidiary to (i) pay dividends or make any
other distributions permitted by applicable law on any Capital Stock of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,
(ii) make payments in respect of any Debt owed to the Company or any other
Restricted Subsidiary, (iii) make loans or advances to the Company or any other
Restricted Subsidiary or (iv) transfer any of its Property to the Company or any
other Restricted Subsidiary. The Company's obligation to comply with this
covenant will terminate if and when the Securities become Investment Grade.
This Section 4.14 shall not restrict or prohibit any encumbrances or
restrictions existing: (i) in connection with the Incurrence of any Debt
permitted under clauses (iii), (vi), (vii), (x) or (xi) of Section 4.9(b) or
with respect to any portion thereof that is also Debt of the Company and
permitted under Section 4.8; provided that such encumbrances or restrictions are
required in order to effect such financing and are not materially more
restrictive, taken as a whole, on the ability of the applicable Restricted
Subsidiary to make the payments, distributions, loans, advances or transfers
referred to in clauses (i) through (iv) of the preceding paragraph than
encumbrances and restrictions, taken as a whole, customarily accepted (or, in
the absence of any industry custom, reasonably acceptable) in substantially
non-recourse project financing, (ii) in connection with the execution and
delivery of an electric power or thermal energy purchase contract to which such
Restricted Subsidiary is the supplying party or other contracts with customers,
suppliers and contractors to which such Restricted Subsidiary is a party and
where such Restricted Subsidiary is engaged in the development, construction,
acquisition or operation of a Power Supply Business; provided that such
encumbrances or restrictions are required in order to effect such contracts and
are not materially more restrictive, taken as a whole, on the ability of the
applicable Restricted Subsidiary to make the payments, distributions, loans,
advances or transfers referred to in clauses (i) through (iv) in the preceding
paragraph than encumbrances and restrictions, taken as a whole, customarily
accepted (or, in the absence of any industry custom, reasonably acceptable) in
substantially non-recourse project financing, (iii) in connection with the
Incurrence of any Debt permitted under clause (iv) of Section 4.9(b), provided
that such encumbrances or restrictions taken as a whole are not materially more
restrictive on the ability of the applicable Restricted Subsidiary to make the
payments, distributions, loans, advances or transfers referred to in
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clauses (i) through (iv) in the preceding paragraph than those that are then in
effect, taken as a whole, in connection with the Debt so exchanged or
refinanced, (iv) in connection with the Bank Credit Agreement and the project
financing, electric power and thermal energy purchase arrangements and other
contracts with customers, suppliers and contractors in effect on the Closing
Date, including extensions, refinancings, renewals or replacements thereof, (v)
pursuant to customary non-assignment provisions in leases, (vi) pursuant to
restrictions imposed pursuant to any stock purchase or asset purchase agreement
pending the consummation of the transactions contemplated thereby, (vii) in
connection with any Acquisition Debt, provided that such encumbrance or
restriction was not incurred in contemplation of the obligor becoming a
Restricted Subsidiary of the Company, which encumbrance or restriction is not
applicable to any Person, or the Property or assets of any Person, other than
the Person, or the Property or assets, acquired, (viii) customary restrictions
on transfers of Property subject to a Lien which could not materially adversely
affect the Company's ability to satisfy its obligations under the Indenture and
the Securities or (ix) provisions contained in agreements or instruments
relating to Debt which prohibit the transfer of all or substantially all of the
assets of the obligor thereunder unless the transferee shall assume the
obligations of the obligor under such agreement or instrument, in each case;
provided that, in the case of clause (iv) above, such encumbrances and
restrictions, taken as a whole, in any such extensions, refinancings, renewals
or replacements are not materially more restrictive on the ability of the
applicable Restricted Subsidiary to make the payments, distributions, loans,
advances or transfers referred to in clauses (i) through (iv) in the preceding
paragraph than those encumbrances or restrictions taken as a whole in effect
immediately before such extension, refinancing, renewal or replacement. This
Section 4.14 shall not prevent the Company from granting any Liens not expressly
prohibited hereby.
SECTION 4.15 Limitation on Asset Dispositions.
---------------------------------
(a) The Company shall not make, and shall not permit any of its
Restricted Subsidiaries to make, any Asset Disposition unless the Company (or
the Restricted Subsidiary, as the case may be) receives consideration at the
time of each such Asset Disposition at least equal to the fair market value of
the shares or assets sold or otherwise disposed of (such amounts in excess of
$50 million determined in good faith by the Board of Directors, as evidenced by
a Board Resolution) and either (i) not less than 75% of the consideration
received by
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the Company (or such Restricted Subsidiary, as the case may be) is in the form
of cash or property or assets used or useful in a Power Supply Business or
Capital Stock of a Person primarily engaged in a Power Supply Business, provided
that any note or other obligation received by the Company (or such Restricted
Subsidiary, as the case may be) that is converted into cash within 180 days of
such Asset Disposition and any liabilities (as shown on the Company's or such
Restricted Subsidiary's most recent balance sheet) of the Company or any
Restricted Subsidiary that are assumed by the transferee of any such assets
shall be deemed to be cash for purposes of this clause (i), and (ii) first, the
Net Cash Proceeds of such Asset Disposition are applied within 90 days from the
later of the date of such Asset Disposition or the receipt of Net Cash Proceeds
related thereto, to the payment of the principal of, premium and interest on any
Senior Debt of the Company (including to cash collateralize letters of credit)
and, in connection with any such payment, any related loan commitment, standby
facility or the like shall be permanently reduced in an amount equal to the
principal amount so repaid and second, to the extent such Net Cash Proceeds are
not required by the lenders, or the terms, of the Senior Debt to be applied in
accordance with the foregoing or, if after being so applied there remain Net
Cash Proceeds, then at the Company's election, such Net Cash Proceeds are either
(x) invested in the business or businesses of the Company or any of its
Restricted Subsidiaries consistent with Section 4.4; provided that such
investment is made within 365 days from the later of the date of such Asset
Disposition or the receipt of the Net Cash Proceeds related thereto or (y)
applied to the payment of any Senior Debt of the Company or Debt of any
Restricted Subsidiary or any Consolidated Subsidiary (other than Debt owed to
the Company or another Restricted Subsidiary), and, in connection with any such
payment, any related loan commitment, standby facility or the like shall be
permanently reduced in an amount equal to the principal amount so repaid;
provided that such Net Cash Proceeds are so applied within three months after
the expiration of the 365-day period referred to in clause (x) above or (z)
applied to make a tender offer (the "Offer") to purchase Securities and other
Debt of the Company from time to time outstanding with similar provisions
requiring the Company to make an offer to purchase or to redeem such Debt with
the proceeds from assets sales, pro rata in proportion to the respective
principal amounts (or accreted values in the case of Debt issued with an
original issue discount) of the Notes (if then outstanding), the Debentures and
such other Debt then outstanding at a purchase price of 100% of their principal
amount (or accreted value in the case of Debt issued with an original issue
discount), plus accrued interest
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(subject to proration in the event of oversubscription in the manner set forth
below). Notwithstanding the foregoing, to the extent that any or all of the Net
Cash Proceeds of any Foreign Asset Disposition are prohibited or delayed by
applicable local law from being repatriated to the U.S., the Company (or such
Restricted Subsidiary, as the case may be) shall not be required to apply the
portion of such Net Cash Proceeds so affected in accordance with clause (ii)
above (other than to repay Debt of the Restricted Subsidiary making such Asset
Disposition or Debt of a Consolidated Subsidiary of the Company, in each case as
contemplated by clause (ii) above and to the extent the prohibition or delay on
repatriation is not applicable to such repayment and such repayment is not in
violation of the terms of any Senior Debt) (the Company hereby agreeing to cause
the applicable Restricted Subsidiary to promptly take all actions required by
the applicable local law to permit such repatriation); provided that once such
repatriation of any such affected Net Cash Proceeds is permitted under the
applicable local law, such repatriation will be immediately effected and such
repatriated Net Cash Proceeds will be applied in the manner set forth in this
Section 4.15. To the extent that dividends or distributions of any or all of the
Net Cash Proceeds of any Foreign Asset Disposition would result in a tax
liability greater than that which would be incurred if such Net Cash Proceeds
were not so dividended or distributed, the Net Cash Proceeds so affected may be
retained by the applicable Restricted Subsidiary for so long as such adverse tax
liability would continue to be incurred.
Notwithstanding anything in this covenant to the contrary, the Company
and any Restricted Subsidiary may make the following Asset Dispositions:
(i) a disposition resulting from the bona fide exercise by
governmental authority of its claimed or actual power of eminent
domain;
(ii) a realization upon a security interest;
(iii) any Permitted Payment or Restricted Payment that is
permitted hereunder; or
(iv) any sale, transfer, conveyance, lease or other
disposition of the Capital Stock or Property of a Restricted
Subsidiary pursuant to the terms of any power sales agreement or steam
sales agreement or other agreement or contract related to the output
or product of, or services rendered by, a Power Supply Business as to
which
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such Restricted Subsidiary is the supplying party; provided that to
the extent the Company or any Restricted Subsidiary receives any cash
consideration in connection with such Asset Disposition, the Net Cash
Proceeds from such Asset Disposition shall be applied in accordance
with clause (ii) of this Section 4.15.
(b) If the aggregate purchase price of Securities and other Debt
tendered pursuant to an Offer made pursuant to clause (ii)(z) clause (a) above
is less than the Net Cash Proceeds allotted to the purchase of the Securities
and other Debt, the Company may use the remaining Net Cash Proceeds for general
corporate purposes. The Company will not be required to comply with the
provisions of clause (ii) in the first paragraph of this Section 4.15 if the Net
Cash Proceeds from one or more Asset Dispositions occurring on or after the date
of the Indenture are less than $40 million in any one fiscal year. Any lesser
amounts so carried forward and cumulated need not be segregated or reserved and
may be used for general corporate purposes.
(c) (i) Promptly, and in any event within 30 days from the Asset
Disposition and the receipt of the Net Cash Proceeds as to which the Company
must make an Offer, the Company shall be obligated to deliver to the Trustee and
send, by first-class mail to each Holder of Securities, a written notice stating
that:
(A) an Asset Disposition has occurred and that such Holders may tender
all or any portion of their Securities pursuant to the Offer in
integral multiples of $1,000 principal amount, at the applicable
purchase price;
(B) any Security not tendered or accepted for payment will continue to
accrue interest;
(C) any Security accepted for payment pursuant to the Offer shall
cease to accrue interest after the Purchase Date (as defined below);
and
(D) holders of Securities will be entitled to withdraw their election
in the manner described in clause (iii) of this Section 4.15(c).
The notice shall specify a purchase date not less than 30 days nor more than 60
days after the date of such notice (the "Purchase Date"), shall include all
instructions and materials necessary to enable each holders of Securities to
tender Secu-
-69-
rities pursuant to the Offer and shall contain information concerning the
business of the Company which the Company in good faith believes will enable
such holder to make an informed decision (which at a minimum will include (1)
the most recently filed Annual Report on Form 10-K (including audited
consolidated financial statements) of the Company, the most recent subsequently
filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the
Company filed subsequent to such Quarterly Report, other than Current Reports
describing other asset dispositions otherwise described in the offering
materials (or corresponding successor reports or reports otherwise required to
be delivered to holder of Securities if the Company is no longer filing reports
pursuant to the Securities Exchange Act of 1934), (2) a description of material
developments in the Company's business subsequent to the date of the latest of
such Reports, and (3) if material, appropriate pro forma financial information).
(ii) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Company shall deliver to the
Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer
Amount"), (B) the allocation of the Net Cash Proceeds pursuant to which such
Offer is being made and (C) the compliance of such allocation with the
provisions of this Section 4.15. Not later than one Business Day prior to the
Purchase Date, the Company shall also irrevocably deposit with the Trustee or
with the Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust) in immediately available funds an amount equal to
the Offer Amount to be held for payment in accordance with the provisions of
this Section 4.15. Upon the expiration of the period for which the Offer remains
open (the "Offer Period"), the Company shall deliver to the Trustee the
Securities or portions thereof which have been properly tendered to and are to
be accepted by the Company. The Trustee or the Paying Agent (if any), or the
Company if acting as its own Paying Agent, shall, on the Purchase Date, mail or
deliver payment to each tendering Holder in the amount of the purchase price. In
the event that the aggregate purchase price of the Securities delivered by the
Company to the Trustee or the Paying Agent (if the Company is not acting as its
own Paying Agent) is less than the Offer Amount, the Trustee or the Paying
Agent, as the case may be, shall deliver the excess to the Company immediately
after the expiration of the Offer Period.
(iii) Any holder of Securities electing to have his Securities
purchased will be required to surrender such Securities, with an appropriate
form duly completed, to the Trus-
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tee at the address specified in the notice by the close of business at least one
Business Day prior to the Purchase Date. Holders of Securities will be entitled
to withdraw their election if the Trustee or Paying Agent (if any) receives not
later than the close of business on the Business Day prior to the Purchase Date
a facsimile transmission or letter setting forth the name of the Holder and a
statement that such Holder is withdrawing his election to have all or a portion
of his Securities purchased. If at the expiration of the Offer Period the
aggregate principal amount of Securities surrendered by holders of Securities
exceeds the Offer Amount, the Company shall select the Securities to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Company so that only Securities in denominations of $1,000 or
integral multiples thereof, shall be purchased). Holders whose Securities are
purchased only in part will be issued new Securities of the same Series equal in
principal amount to the unpurchased portion of the Securities surrendered.
(iv) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company will also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section 4.15. A Security
shall be deemed to have been accepted for purchase at the time the Trustee,
directly or through an agent, or the Company if acting as its own Paying Agent,
mails or makes available for delivery payment therefor to the surrendering
Holder.
(d) In the event the Company is unable to purchase Securities from
Holders thereof in an Offer because such purchase is prohibited by any provision
of applicable law, the Company need not make an Offer. The Company shall then be
obligated to use such Net Cash Proceeds in accordance with clause (i)(B)(x) or
(y) of this Section 4.15(c).
(e) Whenever Net Cash Proceeds are received by the Company, and prior
to the allocation of such Net Cash Proceeds pursuant to this Section 4.15, such
Net Cash Proceeds shall be set aside by the Company in a separate account
pending allocation.
The Company will comply with all applicable tender offer rules,
including without limitation Rule 14e-1 under the Exchange Act, in connection
with an Offer under the provisions of this covenant.
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ARTICLE V
SUCCESSOR CORPORATION
---------------------
SECTION 5.1 Merger, Consolidation, Etc.
---------------------------
The Company shall not consolidate with, merge with or into, or
transfer all or substantially all of its assets (as an entirety or substantially
an entirety in one transaction or a series of related transactions), to any
Person unless: (i) the Company shall be the continuing Person, or the Person (if
other than the Company) formed by such consolidation or into which the Company
is merged or to which properties and assets of the Company are transferred shall
be a solvent corporation organized and existing under the laws of the United
States or any State thereof or the District of Columbia and shall expressly
assume in writing all the obligations of the Company under the Securities and
this Indenture; (ii) immediately after giving effect to such transaction no
Event of Default or event or condition which through the giving of notice of
lapse of time or both would become an Event of Default shall have occurred and
be continuing; (iii) immediately after giving effect to such transaction on a
pro forma basis, the Company or the surviving entity would be able to incur at
least $1 of Debt under Section 4.8(a) and (iv) the Company or such Person shall
have delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger or transfer and, if a
supplemental indenture is required in connection with such transaction, such
supplemental indenture, comply with this provision of this Indenture and that
all conditions precedent in this Indenture relating to such transaction have
been satisfied. Notwithstanding the foregoing, clause (iii) of the preceding
sentence shall not prohibit a transaction, the principal purpose of which is (as
determined in good faith by the Board of Directors as evidenced by a Board
Resolution) to change the state of incorporation of the Company, and such
transaction does not have as one of its purposes the evasion of the limitations
imposed by this covenant.
SECTION 5.2 Successor Entity Substituted.
-----------------------------
Upon any consolidation or merger, or any conveyance, lease or transfer
of all or substantially all of the assets of the Company in accordance with
Section 5.1, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, lease or transfer is made shall
succeed to, and be substituted for, and may exercise
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every right and power of, the Company under this Indenture with the same effect
as if such successor Person had been named as the Company herein; and thereafter
(except in the case of a sale, assignment, transfer, conveyance, lease or other
disposition) the Company shall be discharged from all obligations and covenants
under this Indenture and the Securities.
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.1 Events of Default.
------------------
An Event of Default, wherever used herein, shall occur with respect to
the Securities of a Series if:
(a) the Company defaults in the payment of all or any part of
principal, the Change of Control purchase price or premium, if any, on any
Security of such Series when the same becomes due and payable at maturity, upon
acceleration, redemption, mandatory repurchase, or otherwise;
(b) the Company defaults in the payment of interest on any Security of
such Series when the same becomes due and payable, and such default continues
for a period of 30 days;
(c) an event of default, as defined in any indenture or instrument
evidencing or under which the Company or any Significant Subsidiary has at the
date of this Indenture or shall hereafter have outstanding any Debt, shall
happen and be continuing and either
(i) such default results from the failure to pay the
principal of such Debt in excess of $50 million at final maturity of
such Debt or
(ii) as a result of such default, the maturity of such Debt
shall have been accelerated so that the same shall be or become due
and payable prior to the date on which the same would otherwise have
become due and payable, and such acceleration shall not be rescinded
or annulled within 60 days and the principal amount of such Debt,
together with the principal amount of any other Debt of the Company or
any Significant Subsidiary in default, or the maturity of which has
been accelerated, aggregates $50 million or more; provided that such
default shall not
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be an Event of Default if such Debt is Debt of a Significant
Subsidiary, is Non-Recourse to the Company in respect of the amounts
not paid or due upon acceleration and the Company could, at the time
of default, incur at least $1 of Debt under Section 4.8(a); and
provided, further, however that, subject to the provisions of Sections
7.1 and 7.2, the Trustee shall not be charged with knowledge of any
such default unless written notice thereof shall have been given to
the Trustee by the Company, by the holder or an agent of the holder of
any such Debt, by the trustee then acting under any indenture or other
instrument under which such default shall have occurred, or by the
Holders of not less than 25% in the aggregate principal amount of the
Securities at the time outstanding;
(d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in this Indenture with respect to the
Securities or under the Securities and such default or breach continues for a
period of 60 consecutive days after written notice, specifying such failure and
demanding that the Company remedy the same, shall have been given by registered
mail, return-receipt requested to the Company by the Trustee or by the Holders
of 25% or more in aggregate principal amount of the Securities;
(e) one or more judgments or orders shall be entered by a court
against the Company or any Significant Subsidiary for the payment of money in an
amount which, individually or in the aggregate exceeds $50 million (excluding
the amount thereof covered by insurance or by a bond written by third parties
but treating any deductibles, self insurance or retentions as not so covered by
insurance) and which judgments or orders shall not be discharged or waived, and
shall remain outstanding and there shall be any period of 60 consecutive days
following entry of such judgment or order in excess of $50 million or the
judgment or order which causes the aggregate amount to exceed $50 million during
which a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; provided, that such a judgment or
order shall not be an Event of Default if such judgment or order is against a
Significant Subsidiary and does not require any payment by the Company and the
Company could, at the expiration of the applicable 60 day period, incur at least
$1 of Debt under Section 4.8;
(f) a court having jurisdiction in the premises enters a decree or
order for (i) relief in respect of the Company or any of its Material
Subsidiaries in an involuntary case un-
-74-
der any applicable bankruptcy, insolvency, or other similar law now or hereafter
in effect, (ii) appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator, or similar official of the Company or any of its Material
Subsidiaries or for all or substantially all of the property and assets of the
Company or any of its Material Subsidiaries or (iii) the winding up or
liquidation of the affairs of the Company or any of its Material Subsidiaries
and, in each case, such decree or order shall remain unstayed and in effect for
a period of 60 consecutive days; or
(g) the Company or any of its Material Subsidiaries (i) commences a
voluntary case under any applicable bankruptcy, insolvency, or other similar law
now or hereafter in effect, or consents to the entry of an order for relief in
an involuntary case under any such law, (ii) consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator, or similar official of the Company or any of its Material
Subsidiaries or for all or substantially all of the property and assets of the
Company or any of its Material Subsidiaries or (iii) effects any general
assignment for the benefit of creditors.
SECTION 6.2 Acceleration.
-------------
(a) If an Event of Default (other than an Event of Default specified
in clauses (f) or (g) of Section 6.1 that occurs with respect to the Company)
occurs with respect to the Securities and is continuing under this Indenture,
then, and in each and every such case either the Trustee or the Holders of not
less than 25% in aggregate principal amount of the Securities then outstanding
(or in the case of an Event of Default specified in clauses (a) or (b), the
Holders of not less than 25% of the aggregate principal amount of the Series so
affected) by written notice to the Company (and to the Trustee if such notice is
given by the Holders (the "Acceleration Notice")), may, and the Trustee at the
request of such Holders shall, declare the principal of, premium, if any, and
accrued interest on the Securities to be immediately due and payable. Upon a
declaration of acceleration, such principal of, and accrued interest shall be
immediately due and payable.
(b) If an Event of Default specified in clauses (f) or (g) of Section
6.1 occurs with respect to the Company, the principal of, and accrued interest
on the Securities then outstanding shall ipso facto become and be immediately
due and payable, subject to the prior payment in full of all Senior Debt,
without any declaration or other act on the part of the
-75-
Trustee or any Holder. The Holders of at least a majority in principal amount of
the outstanding Securities may, by written notice to the Company and to the
Trustee, waive all past defaults with respect to the Securities and rescind and
annul a declaration of acceleration with respect to the Securities and its
consequences if (i) all existing Events of Default applicable to the Securities,
other than the nonpayment of the principal of, Change in Control purchase price
or premium, if any, and interest on the Securities that have become due solely
by such declaration of acceleration, have been cured or waived and (ii) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.
SECTION 6.3 Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been
recovered.
SECTION 6.4 Waiver of Past Default.
-----------------------
Subject to Sections 6.2, 6.7 and 9.2, the Holders of, in the
aggregate, at least a majority in principal amount of the then outstanding
Securities by notice to the Trustee may waive an existing Default or Event of
Default and its consequences, except a Default or Event of Default specified in
Section 6.1(a) or (b) or a Default or Event of Default in respect of any
provision hereof which cannot be modified or amended without the consent of the
Holder so affected pursuant to Section 9.2. When a Default or Event of Default
is so waived, it shall be deemed cured and cease to exist; but no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereto.
-76-
SECTION 6.5 Control by Majority.
--------------------
The Holders of at least a majority in aggregate principal amount of
the outstanding the Securities may direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture, that may involve
the Trustee in personal liability, or that the Trustee determines in good faith
may be unduly prejudicial to the rights of Holders of the Securities not joining
in the giving of such direction and may take any other action it deems proper
that is not inconsistent with any such direction received from Holders of the
Securities.
SECTION 6.6 Limitation on Suits.
--------------------
A Holder may not pursue any remedy with respect to this Indenture or
the Securities unless:
(a) the Holder has previously given to the Trustee written
notice of a continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal
amount of the then outstanding Securities make a written request to
the Trustee to pursue a remedy;
(c) such Holder or Holders offer and, if requested, provide
to the Trustee indemnity reasonably satisfactory to the Trustee
against any costs, liability or expense;
(d) the Trustee does not comply with the request within 60
days after receipt of the request and offer of indemnity; and
(e) during such 60-day period the Holders of at least a
majority in aggregate principal amount of the then outstanding
Securities do not give the Trustee a direction which is inconsistent
with the request.
A Holder may not use this Indenture to prejudice the rights of another
Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.7 Rights of Holders To Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal
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of and interest on a Security, on or after the respective due dates expressed in
the Security, or to bring suit for the enforcement of any such payment on or
after such respective dates, is absolute and unconditional and shall not be
impaired or affected without the consent of such Holder.
SECTION 6.8 Collection Suit by Trustee.
---------------------------
If an Event of Default specified in Section 6.1(a) or (b) occurs and
is continuing, the Trustee may recover judgment in its own name and as trustee
of an express trust against the Company or any other obligor on the Securities
for the whole amount of principal and accrued interest remaining unpaid,
together with interest overdue on principal and, to the extent that payment of
such interest is lawful, interest on overdue installments of interest, in each
case at the Interest Rate and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 6.9 Trustee May File Proofs of Claim.
---------------------------------
The Trustee shall be entitled and empowered to file such proofs of
claim and other papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and the Holders allowed in any judicial proceedings relative to the
Company or any of its Subsidiaries (or any other obligor upon the Securities),
its creditors or its property and shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same, and any Custodian in any such judicial proceedings
is hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agent and counsel, and any other amounts due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
-78-
SECTION 6.10 Priorities.
-----------
If the Trustee collects any money pursuant to this Article VI, it
shall, subject to the provisions of Article XI hereof, pay out such money in the
following order:
First: to the Trustee for amounts due under Section 7.7;
Second: subject to Article XI, to Holders for interest accrued on the
Securities, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for
interest; and
Third: subject to Article XI, to Holders for principal amounts owing
under the Securities, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for
principal.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Holders pursuant to this Section
6.10.
SECTION 6.11 Undertaking for Costs.
----------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.7, or a suit by any Holder, or group of Holders,
holding in the aggregate more than 10% in principal amount of the outstanding
Securities.
SECTION 6.12 Rights and Remedies Cumulative.
-------------------------------
No right or remedy herein conferred upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and
every remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall
-79-
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 6.13 Delay or Omission Not Waiver.
-----------------------------
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article 6 or by
law to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
SECTION 6.14 Restoration of Rights and Remedies.
-----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
SECTION 7.1 Duties of Trustee.
------------------
(a) If an Event of Default actually known to a Responsible Officer of
the Trustee has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties as are
specifically set forth in this Indenture or the TIA
-80-
and no others and no implied covenants or obligations shall be read
into this Indenture against the Trustee.
(ii) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, in the case of any such certificate or
opinions which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine such certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) This paragraph does not limit the effect of paragraph
(b) of this Section 7.1.
(ii) The Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts.
(iii) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Sections 6.2, 6.4 and 6.5.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.1.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee
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need not be segregated from other funds except to the extent required by law.
SECTION 7.2 Rights of Trustee.
------------------
Subject to Section 7.1:
(a) The Trustee may rely and shall be protected in acting
or refraining from acting upon any document reasonably believed by it
to be genuine and to have been signed or presented by the proper
Person. The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled during normal
business hours and upon reasonable advance notice to the Company to
examine the books, records and premises of the Company, personally or
by agent or attorney.
(b) Before the Trustee acts or refrains from acting with
respect to any matter contemplated by this Indenture, it may require
an Officers' Certificate or an Opinion of Counsel, which shall
conform to the provisions of Section 10.5. The Trustee shall not be
liable for any action it takes or omits to take in good faith in
reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents
and shall not be responsible for the misconduct or negligence of any
agent (other than the negligence or willful misconduct of an agent
who is an employee of the Trustee) appointed with due care.
(d) The Trustee shall not be liable for any action it
takes or omits to take in good faith and without negligence which it
reasonably believes to be authorized or within its rights or powers
conferred upon it by this Indenture or the TIA.
(e) The Trustee may consult with counsel of its selection
and the advice or opinion of such counsel as to matters of law shall
be full and complete authorization
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and protection from liability in respect of any action taken, omitted
or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
(f) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the
Trustee has actual knowledge thereof or unless written notice of any
event which is in fact such a default is received by the Trustee at
the Corporate Trust Office of the Trustee, and such notice references
the Securities and this Indenture.
SECTION 7.3 Individual Rights of Trustee.
-----------------------------
The Trustee in its individual capacity or any other capacity may
become the owner or pledgee of Securities and may otherwise deal with the
Company, or its Subsidiaries and Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights. However, the
Trustee is subject to Sections 7.10 and 7.11.
SECTION 7.4 Trustee's Disclaimer.
---------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, and it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Company in this Indenture, or any statement
in the Securities other than the Trustee's certificate of authentication.
SECTION 7.5 Notice of Defaults.
-------------------
If a Default or an Event of Default with respect to the Securities
occurs and is continuing and a Responsible Officer of the Trustee receives
written notice of such Default or Event of Default, the Trustee shall mail to
each Securityholder notice of the Default or Event of Default within 90 days
after the occurrence thereof in accordance with TIA ss. 313(c). Except in the
case of a Default or an Event of Default in payment of principal of or interest
on any Security, including on acceleration, and the failure to make payment when
required by Section 4.11, and except in the case of a failure to comply with
Article V hereof, the Trustee may withhold the notice to the Securityholders for
a period not to exceed 60 days if and so long as a committee of its Trust
Officers in good faith deter-
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mines that withholding the notice is in the interest of Securityholders.
SECTION 7.6 Reports by Trustee to Holders.
-----------------------------
To the extent required by TIA ss. 313(a), within 60 days after July 1
of each year commencing with 1998 and for as long as there are Securities
outstanding hereunder, the Trustee shall mail to each Holder the Company's brief
report dated as of such date that complies with TIA ss. 313(a). The Trustee also
shall comply with TIA ss. 313(b) and TIA ss. 313(c) and (d). A copy of such
report at the time of its mailing to Securityholders shall be filed with the
SEC, if required, and each stock exchange, if any, on which the Securities are
listed.
The Company shall promptly notify the Trustee if the Securities
become listed on any stock exchange and the Trustee shall comply with TIA ss.
313(d).
SECTION 7.7 Compensation and Indemnity.
---------------------------
The Company shall pay to the Trustee, the Paying Agent and the
Registrar from time to time such compensation as shall be agreed in writing with
the Company from time to time for their respective services rendered hereunder.
The Trustee's, the Paying Agent's and the Registrar's compensation shall not be
limited by any law in regard to the compensation of a trustee of an express
trust. The Company shall reimburse the Trustee, the Paying Agent and the
Registrar upon request for all reasonable out-of-pocket disbursements, expenses
and advances (including reasonable fees and expenses of counsel) incurred or
made by each of them in connection with entering into this Indenture and the
performance of its duties under this Indenture, in addition to the compensation
for their respective services under this Indenture. Such expenses shall include
the reasonable compensation, out-of-pocket disbursements and expenses of the
Trustee's, the Paying Agent's and the Registrar's agents and counsel.
The Company shall indemnify the Trustee, the Paying Agent and the
Registrar for, and hold each of them harmless against, any and all claims,
demands, expenses (including but not limited to attorneys' fees and expenses),
loss or liability incurred by each of them arising out of or in connection with
the acceptance or administration of this Indenture and their respective duties
hereunder. Each of the Trustee, the Paying Agent and the Registrar shall notify
the Company promptly of any claim asserted against it for which it may seek
indemnity.
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However, failure by the Trustee, the Paying Agent or the Registrar to so notify
the Company shall not relieve the Company of its obligations hereunder. The
Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee, the Paying Agent or the Registrar through the
Trustee's, the Paying Agent's or the Registrar's, as the case may be, own
willful misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section 7.7, each
of the Trustee, the Paying Agent and the Registrar shall have a lien prior to
the Securities on all money or property held or collected by it, in its capacity
as Trustee, Paying Agent or Registrar, as the case may be, except money or
property held in trust to pay principal of or interest on particular Securities.
When any of the Trustee, the Paying Agent and the Registrar incurs
expenses or renders services after an Event of Default specified in Section
6.1(f) or (g) occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any Bankruptcy Law. The
provisions of the Section shall survive the termination of this Indenture.
SECTION 7.8 Replacement of Trustee.
-----------------------
The Trustee may resign at any time by so notifying the Company in
writing, such resignation to be effective upon the appointment of a successor
Trustee. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Trustee in writing and may
appoint a successor Trustee with the Company's consent which consent shall not
be unreasonably withheld. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent;
(c) a receiver or other public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee),
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the Company shall promptly appoint a successor Trustee. Within one year after
the successor Trustee takes office, the Holders of a majority in principal
amount of the Securities may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee (subject to the lien provided in Section 7.7), the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 25% in principal amount of then outstanding Securities may
petition, at the expense of the Company, any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
SECTION 7.9 Successor Trustee by Merger, Etc.
---------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or national banking association, the resulting, surviving or
transferee corporation or national banking association without any further act
shall be the successor Trustee, provided such corporation or national banking
association shall be otherwise qualified and eligible under this Article VII.
SECTION 7.10 Eligibility; Disqualification.
------------------------------
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1) and (2). There shall
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at all times be a Trustee hereunder which shall be a Person that is eligible
pursuant to the TIA to act as such and has combined capital and surplus of at
least $150,000,000. If such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. The Trustee shall
comply with TIA ss. 310(b), provided that there shall be excluded from the
operation of TIA ss. 310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other securities, of
the Company are outstanding if the requirements for such exclusion set forth in
TIA ss. 310(b)(1) are met. The provisions of TIA ss. 310 shall apply to the
Company, as obligor of the Securities.
SECTION 7.11 Preferential Collection of Claims Against
Company.
--------
The Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein. The
provisions of TIA ss. 311 shall apply to the Company as obligor on the
Securities.
ARTICLE VIII
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
SECTION 8.1. Satisfaction and Discharge of
Indenture.
----------
If at any time (a) the Company shall have paid or caused to be paid
the principal of and interest on all the Securities of a Series outstanding
hereunder (other than Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 2.7) as and when the
same shall have become due and payable, or (b) the Company shall have delivered
to the Trustee for cancellation all Securities of such Series theretofore
authenticated (other than any Securities of such Series which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as provided
in Section 2.7) or (c) (i) all the Securities of a Series not theretofore
delivered to the Trustee for cancellation shall
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have become due and payable, or are by their terms to become due and payable
within one year or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption,
and (ii) the Company shall have irrevocably deposited or caused to be deposited
with the Trustee as trust funds the entire amount in cash (other than moneys
repaid by the Trustee or any paying agent to the Company in accordance with
Section 8.4) or U.S. Government Obligations, maturing as to principal and
interest in such amounts and at such times as will insure the availability of
cash sufficient to pay at maturity or upon redemption all Securities of such
Series (other than those Securities of such Series which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as provided
in Section 2.7) not theretofore delivered to the Trustee for cancellation,
including principal and interest due or to become due on or prior to such date
of maturity as the case may be, and if, in any such case, the Company shall also
pay or cause to be paid all other sums payable hereunder by the Company with
respect to Securities, then this Indenture shall cease to be of further effect
with respect to Securities of such Series (except as to (i) rights of
registration of transfer and exchange of Securities of such Series, and the
Company's right of optional redemption, if any, (ii) substitution of mutilated,
defaced, destroyed, lost or stolen Securities of such Series, (iii) rights of
holders to receive payments of principal thereof and interest thereon, upon the
original stated due dates therefor (but not upon acceleration), (iv) the rights,
obligations and immunities of the Trustee hereunder and (v) the rights of the
Security holders as beneficiaries hereof with respect to the property so
deposited with the Trustee payable to all or any of them, and the Trustee, on
demand of the Company accompanied by an Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company, shall execute proper
instruments acknowledging such satisfaction of and discharging this Indenture
with respect to Securities of such Series; provided, that the rights of Holders
of the Securities of such Series to receive amounts in respect of principal of
and interest on the Securities of such Series held by them shall not be delayed
longer than required by then-applicable mandatory rules or policies of any
securities exchange upon which the Securities are listed. The Company agrees to
reimburse the Trustee for any costs or expenses thereafter reasonably and
properly incurred and to compensate the Trustee for any services thereafter
reasonably and properly rendered by the Trustee in connection with this
Indenture or the Securities.
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SECTION 8.2. Application by Trustee of Funds
Deposited for Payment of Securities.
------------------------------------
Subject to Section 8.4 and to the subordination provisions of Article
XI hereof, all moneys deposited with the Trustee pursuant to Section 8.1 shall
be held in trust and applied by it to the payment, either directly or through
any paying agent (including the Company acting as its own paying agent), to the
Holders of the particular Securities of such Series for the payment or
redemption of which such moneys have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest; but such money
need not be segregated from other funds except to the extent required by law.
SECTION 8.3. Repayment of Moneys Held by Paying
Agent.
------
In connection with the satisfaction and discharge of this Indenture
with respect to the Securities of a Series, all moneys then held by any Paying
Agent under the provisions of this Indenture with respect to the Securities of
such Series shall, upon demand of the Company, be repaid to it or paid to the
Trustee and thereupon such paying agent shall be released from all further
liability with respect to such moneys.
SECTION 8.4. Return of Moneys Held by Trustee and
Paying Agent Unclaimed for Two Years.
-------------------------------------
Any moneys deposited with or paid to the Trustee or any Paying Agent
for the payment of the principal of or interest on any Security and not applied
but remaining unclaimed for two years after the date upon which such principal
or interest shall have become due and payable, shall, upon the written request
of the Company and unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property law, be repaid to the
Company by the Trustee or such Paying Agent, and the Holder of the Security
shall, unless otherwise required by mandatory provisions of applicable escheat
or abandoned or unclaimed property laws, thereafter look only to the Company for
any payment which such Holder may be entitled to collect, and all liability of
the Trustee or any Paying Agent with respect to such moneys shall thereupon
cease.
SECTION 8.5. Defeasance and Discharge of Indenture.
--------------------------------------
The Company shall be deemed to have paid and shall be discharged from
any and all obligations in respect of the Secu-
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rities of any Series, on the 123rd day after the deposit referred to in clause
(A) hereof has been made, and the provisions of this Indenture shall no longer
be in effect with respect to the Securities of such Series (and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging the
same), except as to: (a) rights of registration of transfer and exchange, and
the Company's right of optional redemption, (b) substitution of apparently
mutilated, defaced, destroyed, lost or stolen Securities of such Series, (c)
rights of holders to receive payments of principal thereof and interest thereon,
upon the original stated due dates therefor (but not upon acceleration), (d) the
rights, obligations and immunities of the Trustee hereunder and (e) the rights
of the Securityholders as beneficiaries hereof with respect to the property so
deposited with the Trustee payable to all or any of them; provided that the
following conditions shall have been satisfied:
(A) with reference to this provision the Company has
deposited or caused to be irrevocably deposited with the Trustee (or
another trustee satisfying the requirements of Sections 7.8 and 7.10)
as trust funds in trust, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of the Securities of
such Series, (i) money in an amount, or (ii) U.S. Government
Obligations which through the payment of interest and principal in
respect thereof in accordance with their terms will provide not later
than one day before the due date of any payment referred to in this
clause (A) money in an amount, or (iii) a combination thereof,
sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge without
consideration of the reinvestment of such interest and after payment
of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee the principal
of, premium, if any, and each installment of interest on the
outstanding Securities of such Series on the due dates thereof or
earlier redemption;
(B) the Company has delivered to the Trustee (i) either
(x) an Opinion of Counsel to the effect that Holders of Securities of
such Series will not recognize income, gain or loss for federal
income tax purposes as a result of the Company's exercise of its
option under this Section 8.5 and will be subject to federal income
tax on the same amount and in the same manner and at the same times
as
-90-
would have been the case if such deposit, defeasance and discharge
had not occurred, which Opinion of Counsel must be based upon a
ruling of the Internal Revenue Service to the same effect or a change
in applicable federal income tax law or related treasury regulations
after the date of this Indenture or (y) a ruling directed to the
Trustee received from the Internal Revenue Service to the same effect
as the aforementioned Opinion of Counsel and (ii) an Opinion of
Counsel to the effect that the creation of the defeasance trust does
not violate the Investment Company Act of 1940 and after the passage
of 123 days following the deposit, the trust fund will not be subject
to the effect of Section 547 of the U.S. Bankruptcy Code or Section
15 of the New York Debtor and Creditor Law;
(C) immediately after giving effect to such deposit on a
pro forma basis, no Event of Default, or event that after the giving
of notice or lapse of time or both would become an Event of Default,
shall have occurred and be continuing on the date of such deposit or
during the period ending on the 123rd day after the date of such
deposit, and such deposit shall not result in a breach or violation
of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which the Company is bound;
(D) the Company is not prohibited from making payments in
respect of the Securities by Article XI hereof; and
(E) if at such time the Securities of such Series are
listed on a national securities exchange, the Company has delivered
to the Trustee an Opinion of Counsel to the effect that the
Securities of such Series will not be delisted as a result of such
deposit, defeasance and discharge.
SECTION 8.6 Defeasance of Certain Obligations.
----------------------------------
The Company may omit to comply with any term, provision or condition
set forth in, and this Indenture will no longer be in effect with respect to,
any covenant in Article V or Sections 4.5 through 4.15 and clauses (c) and (e)
of Section 6.1 shall not be deemed to be an Event of Default with respect to the
Securities of a Series, if
(A) with reference to this Section 8.6, the Company has
deposited or caused to be irrevocably deposited with
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the Trustee (or another trustee satisfying the requirements of
Section 7.8) as trust funds in trust, specifically pledged as
security for, and dedicated solely to, the benefit of the Holders of
the Securities of such Series and this Indenture with respect to the
Securities of such Series, (i) money in an amount or (ii) U.S.
Government Obligations which through the payment of interest and
principal in respect thereof in accordance with their terms will
provide not later than one day before the due dates thereof or
earlier redemption (irrevocably provided for under agreements
satisfactory to the Trustee), as the case may be, of any payment
referred to in this clause (A) money in an amount, or (iii) a
combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge without consideration of the reinvestment of such interest
and after payment of all federal, state and local taxes or other
charges and assessments in respect thereof payable by the Trustee the
principal of, premium, if any, and each installment of interest on
the outstanding Securities of such Series on the due date thereof or
earlier redemption (irrevocably provided for under arrangements
satisfactory to the Trustee), as the case may be;
(B) the Company has delivered to the Trustee (i) an
Opinion of Counsel to the effect that Holders of Securities of such
Series will not recognize income, gain or loss for federal income tax
purposes as a result of the Company's exercise of its option under
this Section 8.6 and will be subject to federal income tax on the
same amount and in the same manner and at the same times as would
have been the case if such deposit and defeasance had not occurred
and (ii) an Opinion of Counsel to the effect that the creation of the
defeasance trust does not violate the Investment Company Act of 1940
and after the passage of 123 days following the deposit, the trust
fund will not be subject to the effect of Section 547 of the U.S.
Bankruptcy Code or Section 15 of the New York Debtor and Creditor
Law;
(C) immediately after giving effect to such deposit on a pro
forma basis, no Event of Default, or event that after the giving of
notice or lapse of time or both would become an Event of Default, shall
have occurred and be continuing on the date of such deposit or during
the period ending on the 123rd day after the date of such de-
-92-
posit, and such deposit shall not result in a breach or violation of,
or constitute a default under, any other agreement or instrument to
which the Company is a party or by which the Company is bound;
(D) the Company is not prohibited from making payments in
respect of the Securities by Article XI hereof; and
(E) if at such time the Securities are listed on a
national securities exchange, the Company has delivered to the
Trustee an Opinion of Counsel to the effect that the Securities will
not be delisted as a result of such deposit, defeasance and
discharge.
SECTION 8.7 Reinstatement.
--------------
If the Trustee or Paying Agent is unable to apply any monies or U.S.
Government Obligations in accordance with Article 8 with respect to a Series of
Securities by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and such Series of Securities shall be revived and reinstated as
though no deposit had occurred pursuant to this Article until such time as the
Trustee or Paying Agent is permitted to apply all such monies or U.S. Government
Obligations in accordance with this Article VIII; provided, however, that if the
Company has made any payment of principal of or interest on any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
monies or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.1 Without Consent of Holders.
---------------------------
Without the consent of any Holders, the Company, when authorized by
resolutions of its Board of Directors (copies of which shall be delivered to the
Trustee) and the Trustee may amend, waive or supplement this Indenture or the
Securities
-93-
without notice to or consent of any Holder for any of the following purposes:
(a) to cure any ambiguity, defect or inconsistency in the
Indenture, provided that such amendments or supplements do not
adversely affect the interests of the Holders in any material
respect;
(b) to provide for uncertificated Securities in addition
to or in place of certificated Securities;
(c) to comply with any requirements of the SEC under the
TIA;
(d) to evidence the succession in accordance with Article
V hereof of another Person to the Company and the assumption by any
such successor of the covenants of the Company herein and in the
Securities;
(e) to evidence and provide for the acceptance of
appointment hereunder by a separate or successor Trustee with respect
to the Securities; or
(f) to make any other change that does not materially and
adversely affect the rights of any Holder;
provided, however, that in making such change, the Trustee may rely upon an
Opinion of Counsel stating that such change does not adversely affect the rights
of any Holder.
SECTION 9.2 With Consent of Holders.
------------------------
Subject to Section 6.7 and the provisions of this Section 9.2, the
Company, when authorized by resolution of its Board of Directors (copies of
which shall be delivered to the Trustee) and the Trustee may amend or supplement
this Indenture, the Securities with the written consent of the Holders of at
least a majority in principal amount of the Securities then outstanding. Subject
to Section 6.7 and the provisions of this Section 9.2, the Holders of, in the
aggregate, at least a majority in principal amount of the then outstanding
Securities affected may waive compliance by the Company with any provision of
this Indenture, the Securities without notice to any other Securityholder.
However, without the consent of each Securityholder affected, an amendment,
supplement or waiver, including a waiver pursuant to Section 6.4, may not:
-94-
(a) reduce the principal amount of Securities the Holders
of which must consent to an amendment, supplement or waiver of any
provision of or with respect to this Indenture or the Securities; or
(b) reduce the principal amount of, premium, if any, or
interest, on any Security; or
(c) change the Stated Maturity of or any installment of
interest on, any Security; or
(d) make the principal of, or interest on, any Security
payable in money other than as provided herein, or
(e) make any change in provisions relating to waivers of
defaults, the ability of Holders to enforce their rights under this
Indenture or in the matters discussed in clauses (a) through (h); or
(f) adversely affect the ranking of the Securities this
Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, supplement
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.2
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
Notwithstanding the foregoing, no amendment shall modify any provision of this
Indenture so as to affect adversely the rights of any holder of Senior
Indebtedness of the Company or Guarantor Senior Indebtedness to the benefits of
the subordination provisions under this Indenture without the consent of such
holder.
SECTION 9.3 Compliance with Trust Indenture Act.
------------------------------------
Every amendment to or supplement of this Indenture or the Securities
shall be set forth in a supplemental indenture that complies with the TIA as
then in effect.
-95-
SECTION 9.4 Revocation and Effect of Consents.
----------------------------------
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of that Security or portion of that Security that evidences the same debt
as the consenting Holder's Security, even if notation of the consent is not made
on any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security. Such revocation shall be
effective only if the Trustee receives the notice of revocation before the date
the amendment, supplement or waiver becomes effective. Notwithstanding the
above, nothing in this paragraph shall impair the right of any Securityholder
under ss. 316(b) of the TIA.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver which record date shall be at least 10 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the second and third sentences of the immediately preceding
paragraph, those Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date. Such
consent shall be effective only for actions taken within 90 days after such
record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder unless it makes a change described in any of clauses
(a) through (h) of Section 9.2. In that case the amendment, supplement or waiver
shall bind each Holder of a Security who has consented to it.
SECTION 9.5 Notation on or Exchange of Securities.
-------------------------------------
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee shall (in accordance with the specific written direction
of the Company) request the Holder of the Security to deliver it to the Trustee.
The Trustee shall (in accordance with the specific direction of the Company)
place an appropriate notation on the Security about the changed terms and return
it to the Holder. Alternatively, if the Company or the Trustee so determines,
the Company in exchange for the Security shall issue and the Trustee shall
authenticate a new Secu-
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rity that reflects the changed terms. Failure to make the appropriate notation
or issue a new Security shall not affect the validity and effect of such
amendment, supplement or waiver.
SECTION 9.6 Trustee to Sign Amendments, Etc.
-------------------------------
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article IX if the amendment, supplement or waiver does not
adversely affect the rights, duties or immunities of the Trustee. If it does,
the Trustee may, but need not, sign it. In signing any amendment, supplement or
waiver, the Trustee shall be entitled to receive, if requested, an indemnity
reasonably satisfactory to it and to receive, and shall be fully protected in
relying upon, an Officers' Certificate and an Opinion of Counsel stating that
the execution of any amendment, supplement or waiver authorized pursuant to this
Article IX is authorized or permitted by this Indenture and that it constitutes
the legal, valid and binding obligation of the Company and subject to the
customary exceptions.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Trust Indenture Act Controls.
-----------------------------
The provisions of TIA xx.xx. 310 through 317 that impose duties on
any person (including the provisions automatically deemed included unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by the above paragraph, the imposed duties shall
control.
SECTION 10.2 Notices.
--------
Any notice or communication shall be sufficiently given if in writing
and delivered in person or mailed by first-class mail or by telecopier, followed
by first-class mail, or by overnight service guaranteeing next-day delivery,
addressed as follows:
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(a) if to the Company:
The AES Corporation
0000 Xxxxx 00xx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopier Number: (000) 000-0000
with a copy to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxx, Xx.
Telecopier Number: (000) 000-0000
(b) if to the Trustee:
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Telecopier Number: (000)000-0000
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder, including any
notice delivered in connection with TIA ss. 310(b), TIA ss. 313(c), TIA ss.
314(a) and TIA ss. 315(b), shall be mailed to such Holder, first-class postage
prepaid, at his address as it appears on the registration books of the Registrar
and shall be sufficiently given to such Holder if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. Except for a notice to the Trustee, which is deemed given only
when received by an officer in the corporate trust department of the Trustee, if
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it. In case by reason of the
suspension of regular mail service or by reason of any other cause it shall be
impracticable to give such notice by mail, then such notification as shall be
made
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with the approval of the Trustee shall constitute a sufficient notification for
every purpose hereunder.
SECTION 10.3 Communications by Holders with
Other Holders.
--------------
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA ss. 312(c).
SECTION 10.4 Certificate and Opinion of Counsel
as to Conditions Precedent.
---------------------------
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee at the
request of the Trustee (a) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with (which officer signing
such certificate may rely, as to matters of law, on an Opinion of Counsel), (b)
an Opinion of Counsel in form and substance reasonably satisfactory to the
Trustee stating that, in the opinion of counsel, all such conditions have been
complied with (which counsel, as to factual matters, may rely on an Officers'
Certificate) and (c) where applicable, a certificate or opinion by an
independent certified public accountant satisfactory to the Trustee that
complies with TIA ss. 314(c).
SECTION 10.5 Statements Required in Certificate
and Opinion of Counsel.
-----------------------
Each certificate and Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture shall include:
(a) a statement that the Person making such certificate or
rendering such Opinion of Counsel has read such covenant or
condition;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or Opinion of Counsel are based;
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(c) a statement that, in the opinion of such Person, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been complied with.
SECTION 10.6 Rules by Trustee, Paying Agent,
Registrar.
----------
The Trustee may make reasonable rules in accordance with the
Trustee's customary practices for action by or at a meeting of Securityholders.
The Paying Agent or Registrar may make reasonable rules for its functions.
SECTION 10.7 Legal Holidays.
---------------
If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
SECTION 10.8 GOVERNING LAW.
--------------
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS. THE COMPANY AGREES
TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND THE
SECURITIES.
SECTION 10.9 No Recourse Against Others.
---------------------------
A trustee, director, officer, employee, stockholder or beneficiary,
as such, of the Company shall not have any liability for any obligations of the
Company under the Securities or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each Security
holder by accepting a Security waives and releases all such liability.
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SECTION 10.10 Successors.
-----------
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 10.11 Counterparts.
-------------
The parties may sign any number of counterparts of this Indenture.
Each such counterpart shall be an original, but all of them together represent
the same agreement.
SECTION 10.12 Severability.
-------------
In case any provision in this Indenture or the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby,
and a Holder shall have no claim therefor against any party hereto.
SECTION 10.13 Table of Contents, Headings, Etc.
---------------------------------
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, and are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 10.14 No Adverse Interpretation
of Other Agreements.
--------------------
This Indenture may not be used to interpret another indenture, loan
or debt agreement of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
SECTION 10.15 Benefits of Indenture.
----------------------
Nothing in this Indenture or in the Securities, express or implied,
shall give to any person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture or the Securities.
SECTION 10.16 Independence of Covenants.
--------------------------
All covenants and agreements in this Indenture and the
Securities shall be given independent effect so that if any
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particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or otherwise be within the
limitations of, another covenant shall not avoid the occurrence of a Default or
an Event of Default if such action is taken or condition exists.
ARTICLE XI
SUBORDINATION OF SECURITIES
SECTION 11.1 Agreement to Subordinate.
-------------------------
The Company covenants and agrees, and each Holder of Securities
issued hereunder by his acceptance thereof likewise covenants and agrees, that
all Securities shall be issued subject to the provisions of this Article; and
each person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof accepts and agrees that the Principal of and
interest on all Securities issued hereunder shall, to the extent and in the
manner herein set forth, be subordinated and subject in right to the prior
payment in full of all Senior Debt.
SECTION 11.2 Payments to Securityholders.
----------------------------
No payments on account of Principal of, Change of Control purchase
price, or interest on the Securities shall be made if at the time of such
payment or immediately after giving effect thereto there shall exist a default
in any payment with respect to any Senior Debt, and such event of default shall
not have been cured or waived or shall not have ceased to exist. In addition,
during the continuance of any other event of default (other than a payment
default) with respect to Designated Senior Debt pursuant to which the maturity
thereof may be accelerated, from and after the date of receipt by the Trustee of
written notice from the holders of such Designated Senior Debt or from an agent
of such holders, no payments on account of Principal, Change of Control purchase
price, or interest in respect of the Securities may be made by the Company for a
period ("Payment Blockage Period") commencing on the date of delivery of such
notice and ending 179 days thereafter (unless such Payment Blockage Period shall
be terminated by written notice to the Trustee from the holders of such
Designated Senior Debt or from an agent of such holders, or such event of
default has been cured or waived or has ceased to exist). Only one Payment
Blockage Period may be commenced with respect to the Securities
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during any period of 360 consecutive days. No event of default which existed or
was continuing on the date of the commencement of any Payment Blockage Period
with respect to the Designated Senior Debt initiating such Payment Blockage
Period shall be or be made the basis for the commencement of any subsequent
Payment Blockage Period by the holders of such Designated Senior Debt, unless
such event of default shall have been cured or waived for a period of not less
than 90 consecutive days.
Upon any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to creditors upon any
liquidation, dissolution, winding up, receivership, reorganization, assignment
for the benefit of creditors, marshalling of assets and liabilities or any
bankruptcy, insolvency or similar proceedings of the Company, all amounts due or
to become due upon all Senior Debt shall first be paid in full, in cash or cash
equivalents, or payment thereof provided for in accordance with its terms,
before any payment is made on account of the Principal of, Change of Control
purchase price, or interest on the indebtedness evidenced by the Securities, and
upon any such liquidation, dissolution, winding up, receivership,
reorganization, assignment, marshalling or proceeding, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to which the Holders of the Securities or the Trustee
under this Indenture would be entitled, except for the provisions hereof, shall
be paid by the Company or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other Person making such payment or distribution, or by the
Holders of the Securities or by the Trustee under this Indenture if received by
them or it, directly to the holders of Senior Debt (pro rata to such holders on
the basis of the respective amounts of Senior Debt held by such holders) or
their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any of such Senior Debt
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Debt in full (including, without limitation, except
to the extent, if any, prohibited by mandatory provisions of law, post-petition
interest, in any such proceedings), after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt, before any payment
or distribution is made to the holders of the indebtedness evidenced by the
Securities or to the Trustee under this Indenture.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited
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by the foregoing, shall be received by the Trustee under this Indenture or the
holders of the Securities before all Senior Debt is paid in full or provision is
made for such payment in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered to
the holders of such Senior Debt or their respective representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing any of such Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of all Senior Debt
remaining unpaid until all such Senior Debt shall have been paid in full in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Debt.
For purposes of this Article, the words, "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of arrangement, reorganization or readjustment, the
payment of which is subordinated (at least to the extent provided in this
Article with respect to the Securities) to the payment of all Senior Debt which
may at the time be outstanding; provided, that (i) the Senior Debt is assumed by
the new corporation, if any, resulting from any such arrangement, reorganization
or readjustment, and (ii) the rights of the holders of the Senior Debt are not,
without the consent of such holders, altered by such arrangement, reorganization
or readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided in Article V shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section if such other
corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated in Article V. Nothing in this
Section shall apply to claims of, or payments to, the Trustee under or pursuant
to Article VII, except as provided therein. This Section shall be subject to the
further provisions of Section 11.5.
SECTION 11.3 Subrogation of Securities.
--------------------------
Subject to the payment in full of all Senior Debt, the holders of the
Securities shall be subrogated to the rights of the holders of Senior Debt to
receive payments or distributions of cash, property or securities of the Company
applicable
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to the Senior Debt until the principal of and interest on the Securities shall
be paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of the Senior Debt of any cash, property or
securities to which the holders of the Securities or the Trustee on their behalf
would be entitled except for the provisions of this Article, and no payment over
pursuant to the provisions of this Article to the holders of Senior Debt by
holders of the Securities or the Trustee on their behalf shall, as between the
Company, its creditors other than holders of Senior Debt and the holders of the
Securities, be deemed to be a payment by the Company to or on account of the
Senior Debt; and no payments or distributions of cash, property or securities to
or for the benefit of the Securityholders pursuant to the subrogation provision
of this Article, which would otherwise have been paid to the holders of Senior
Debt shall be deemed to be a payment by the Company to or for the account of the
Securities. It is understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights of the holders
of the Securities, on the one hand, and the holders of the Senior Debt, on the
other hand.
Nothing contained in this Article or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Debt, and the holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Securities the principal of and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the
holders of the Securities and creditors of the Company other than the holders of
the Senior Debt, nor shall anything herein or therein prevent the holder of any
Security or the Trustee on his behalf from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article of the holders of Senior Debt in respect of
cash, property or securities of the Company received upon the exercise of any
such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Sections 7.1 and 7.2,
and the holders of the Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which such liquidation,
dissolution, winding up, receivership, reorganization, assignment or marshalling
proceedings are pending, or a certificate of the receiver, trustee in
bankruptcy, liquidating
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trustee, agent or other person making such payment or distribution, delivered to
the Trustee or to the holders of the Securities, for the purpose of ascertaining
the persons entitled to participate in such distribution, the holders of the
Senior Debt and other indebtedness of the Company, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article.
SECTION 11.4 Authorization by Securityholders.
---------------------------------
Each holder of a Security by his acceptance thereof authorizes the
Trustee in his behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article and appoints the Trustee
his attorney-in-fact for any and all such purposes.
SECTION 11.5 Notice to Trustee.
------------------
The Company shall give prompt written notice to the Trustee and to any
Paying Agent of any fact known to the Company which would prohibit the making of
any payment of moneys to or by the Trustee or any Paying Agent in respect of the
Securities pursuant to the provisions of this Article. Regardless of anything to
the contrary contained in this Article or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any Senior Debt
or of any default or event of default with respect to any Senior Debt or of any
other facts which would prohibit the making of any payment of moneys to or by
the Trustee, unless and until the Trustee shall have received notice in writing
at its principal Corporate Trust Office to that effect signed by an officer of
the Company, or by a holder or agent of a holder of Senior Debt who shall have
been certified by the Company or otherwise established to the reasonable
satisfaction of the Trustee to be such holder or agent, or by the trustee under
any indenture pursuant to which Senior Debt shall be outstanding, and, prior to
the receipt of any such written notice, the Trustee shall, subject to Sections
7.1 and 7.2, be entitled to assume that no such facts exist; provided that if on
a date at least three Business Days prior to the date upon which by the terms
hereof any such moneys shall become payable for any purpose (including, without
limitation, the payment of the principal of, or interest on any Security) the
Trustee shall not have received with respect to such moneys the notice provided
for in this Section, then, regardless of anything herein to the contrary, the
Trustee shall have full power and authority to receive such moneys and to apply
the same to the purpose for which they were received, and
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shall not be affected by any notice to the contrary which may be received by it
on or after such prior date.
Regardless of anything to the contrary herein, nothing shall prevent
(a) any payment by the Company or the Trustee to the Securityholders of amounts
in connection with a redemption of Securities if (i) notice of such redemption
has been given pursuant to Article III prior to the receipt by the Trustee of
written notice as aforesaid, and (ii) such notice of redemption is given not
earlier than 60 days before the redemption date, or (b) any payment by the
Trustee to the Securityholders of amounts deposited with it pursuant to Section
8.1.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a person representing himself to be a holder of Senior Debt
(or a trustee on behalf of such holder) to establish that such notice has been
given by a holder of Senior Debt or a trustee on behalf of any such holder. In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article, the Trustee
may request such person to furnish evidence to the reasonable satisfaction of
the Trustee as to the amount of Senior Debt held by such person, the extent to
which such person is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such person under this Article, and
if such evidence is not furnished the Trustee may defer any payment to such
person pending judicial determination as to the right of such person to receive
such payment.
SECTION 11.6 Trustee's Relation to Senior Debt.
----------------------------------
The Trustee and any agent of the Company or the Trustee shall be
entitled to all the rights set forth in this Article with respect to any Senior
Debt which may at any time be held by it in its individual or any other capacity
to the same extent as any other holder of Senior Debt and nothing in this
Indenture shall deprive the Trustee or any such agent, of any of its rights as
such holder. Nothing in this Article shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 7.7.
With respect to the holders of Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture
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against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Debt and, subject to the provisions of Sections 7.1 and
7.2, the Trustee shall not be liable to any holder of Senior Debt if it shall
pay over or deliver to holders of Securities, the Company or any other person
moneys or assets to which any holder of Senior Debt shall be entitled by virtue
of this Article or otherwise.
SECTION 11.7 No Impairment of Subordination.
--------------------------------------------
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with.
S-1
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
THE AES CORPORATION,
as Issuer
By:____________________________
Name: Title:
THE FIRST NATIONAL BANK
OF CHICAGO,
as Trustee
By:____________________________
Name: Title:
EXHIBIT A
(FORM OF FACE OF SECURITY)
No. [ ] $ CUSIP NO.: 00000XXX0
8.50% SENIOR SUBORDINATED NOTE DUE 2007
THE AES CORPORATION promises to pay
to [ ] or registered assigns the
principal sum of[ ] Dollars on
November 1, 2007.
Interest Payment Dates: May 1, November 1 and at maturity
Record Dates: April 15 or October 15 as the case may be, next preceding such
Interest Payment Date
By:
----------------------------
Authorized Signature
By:
----------------------------
Authorized Signature
Dated: October , 1997
Certificate of Authentication
This is one of the 8.50% Senior Subordinated Notes due 2007 referred
to in the within-mentioned indenture.
The First National Bank
of Chicago, as Trustee
By:
------------------------------
Authorized Signatory
A-1
THE AES CORPORATION
8.50% SENIOR SUBORDINATED NOTE DUE 2007
1. Interest. THE AES CORPORATION, a Delaware corporation (the
"Company," which definition shall include any successor thereto in accordance
with the Indenture (as defined below)), promises to pay, until the principal
hereof is paid or made available for payment, interest on the principal amount
set forth on the reverse side hereof at a rate of 8.50% per annum. Interest on
the Notes will accrue from and including the most recent date to which interest
has been paid or, if no interest has been paid, from the date of issuance
through but excluding the date on which interest is paid. Interest shall be
payable in arrears on May 1,and November 1, and at the stated maturity (each an
"Interest Payment Date"), commencing May 1, 1998. Interest will be computed on
the basis of a 360 day year of twelve 30 day months.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on April 15 and October 15 next preceding the Interest
Payment Date. Holders must surrender Notes to a Paying Agent to collect
principal payments. The Company will pay principal, premium, if any, and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. At the Company's option,
interest may be paid by check mailed to the registered address of the Holder of
this Note.
3. Paying Agent and Registrar. Initially, The First National Bank of
Chicago (the "Trustee") will act as Paying Agent and Registrar. The Company may
change any Paying Agent, Registrar or co-Registrar without notice. Neither the
Company nor any of its Subsidiaries may act as Paying Agent, Registrar or
co-Registrar.
4. Indenture. The Company issued the Notes under an Indenture dated as
of October 29, 1997 (the "Indenture") between the Company and the Trustee. This
Note is one of an issue of Notes of the Company issued under the Indenture. The
terms of the Notes include those stated in the Indenture and
A-2
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code xx.xx. 77aaa-77bbbb) as amended from time to time. The Notes are
subject to all such terms, and Securityholders are referred to the Indenture and
such Act for a statement of them. Capitalized terms used herein and not
otherwise defined have the meanings set forth in the Indenture. The Notes are
general unsecured obligations of the Company subordinated in right of payment to
all Senior Debt of the Company. The Indenture limits, among other things, the
ability of the Company and its Restricted Subsidiaries to incur certain Debt;
pay dividends and make other distributions; make certain investments; engage in
unrelated businesses; dispose of certain Assets; engage in transactions with
certain Affiliates; and merge with or into another entity. The limitations are
subject to a number of important qualifications and exceptions. The Company must
report to the Trustee annually whether it is in compliance with the limitations
contained in the Indenture.
5. Optional Redemption.
The Notes are subject to redemption upon not less than 30 nor more
than 60 days' notice by mail, at any time on or after October 15, 2002, as a
whole or in part, at the election of the Company, at the following Redemption
Prices (expressed as percentages of the principal amount): If redeemed during
the 12-month period beginning on or after August 15 of the years set forth
below,
Redemption
Year Price
---- ---------
2002 104.250%
2003 102.833%
2004 101.417%
and after November 1, 2005 at a Redemption Price equal to 100% of the principal
amount, together in the case of any such redemption with accrued interest to the
Redemption Date.
In addition prior to November 1, 2000, in the event that the Company
consummates one or more offerings of its Qualified Capital Stock, the Company
may at its option, use all or a portion of the proceeds therefrom to redeem up
to 33% of the original aggregate principal amount at maturity of the Notes at a
cash redemption price equal to 108.500% of the principal amount thereof, plus
accrued and unpaid interest thereon through the date of repurchase; provided
that at least $100
A-3
million of the original aggregate principal amount of the Notes remains
outstanding thereafter.
6. Offers to Purchase. Section 4.11 of the Indenture provides upon the
occurrence of a Change of Control and subject to further limitations contained
therein, the Company shall make an offer to purchase the Securities in
accordance with the procedures set forth in the Indenture.
7. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay to it any taxes and
fees required by law or permitted by the Indenture. The Registrar need not
transfer or exchange any Security or portion of a Security selected for
redemption, or transfer or exchange any Securities for a period of 15 days
before the mailing of a notice of redemption of Securities to be redeemed.
8. Persons Deemed Owners. The registered holder of a Security may be
treated as the owner of it for all purposes.
9. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Company at its written request. After that, Holders entitled to the
money must look to the Company for payment as general creditors unless an
"abandoned property" law designates another Person.
10. Amendment, Supplement, Waiver. The Company and the Trustee may,
without the consent of the holders of any outstanding Securities, amend, waive
or supplement the Indenture, the Securities for certain specified purposes,
including, among other things, curing ambiguities, defects or inconsistencies,
maintaining the qualification of the Indenture under the Trust Indenture Act of
1939 or making any other change that does not adversely affect the rights of any
Holder. Other amendments and modifications of the Indenture or the Securities
may be made by the Company and the Trustee with the consent of the Holders of
not less than a majority of the aggregate principal amount of the outstanding
Securities, subject to certain exceptions requiring the consent of the Holders
of the particular Securities to be affected.
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11. Successor Corporation. When a successor corporation assumes all
the obligations of its predecessor under the Securities and the Indenture and
the transaction complies with the terms of Article V of the Indenture, the
predecessor corporation, subject to certain exceptions, will be released from
those obligations.
12. Defaults and Remedies. Events of Default are set forth in the
Indenture. Subject to certain limitations in the Indenture, if an Event of
Default (other than an Event of Default specified in Section 6.1(f) or (g) of
the Indenture with respect to the Company) occurs and is continuing, then the
holders of not less than 25% in aggregate principal amount of the outstanding
Securities (or in the case of an Event of Default specified in Section 6.1 (a)
or (b) of the Indenture, the Holders of not less than 25% in aggregate principal
amount of the outstanding Series so affected) may, or the Trustee may, declare
the principal of, premium, if any, plus accrued interest, if any, to be due and
payable immediately. If an Event of Default specified in Section 6.1(f) or (g)
of the Indenture with respect to the Company occurs and is continuing, the
principal of, premium, if any, and accrued interest on all of the Securities
shall ipso facto become and be immediately due and payable subject to the prior
payment in full of Senior Debt without any declaration or other act on the part
of the Trustee or any Holder. Securityholders may not enforce the Indenture or
the Securities except as provided in the Indenture. The Trustee may require
indemnity reasonably satisfactory to it before it enforces the Indenture or the
Securities. Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Securities may direct the Trustee in its exercise
of any trust or power. The Trustee may withhold from Securityholders notice of
any continuing default (except a default in payment of principal or interest or
a failure to comply with Article V of the Indenture) if it determines that
withholding notice is in their interests. The Company must furnish an annual
compliance certificate to the Trustee.
13. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not Trustee.
14. No Recourse Against Others. A director, officer, employee,
stockholder or beneficiary, as such, of the Company shall not have any liability
for any obligations of the
A-5
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of, such obligations or their creation. Each
Securityholder by accepting a Security waives and releases all such liability.
The waiver and release are part of the consideration for the issue of the
Securities.
15. Defeasance. The Indenture contains provisions (which provisions
apply to this Note) for defeasance at any time of (a) the entire indebtedness of
the Company or this Note and (b) certain restrictive covenants and related
Defaults and Events of Default, in each case upon compliance by the Company with
certain conditions set forth therein.
16. Authentication. This Note shall not be valid until the Trustee
signs the certificate of authentication on the other side of this Note.
17. Abbreviations. Customary abbreviations may be used in the name of
a Securityholder or an assignee, such as: TEN COM (= tenants in common), TENANT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
18. Subordination. The Company's payment of principal of, premium, if
any, and interest on the Securities is subordinated in right of payment, to the
extent and in the manner provided in Article XI of the Indenture, to the prior
payment in full of the Senior Debt of the Company. Each Holder of the
Securities, by his acceptance hereof, covenants and agrees that all payments of
the principal of, premium, if any, and interest on the Securities by the Company
shall be subordinated in accordance with the provisions of Article XI of the
Indenture, and each Holder accepts and agrees to be bound by such provisions.
19. GOVERNING LAW. THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
A-6
The Company will furnish to any Securityholder upon written request
and without charge a copy of the Indenture. Requests may be made to:
THE AES CORPORATION
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: General Counsel
A-7
ASSIGNMENT FORM
If you the holder want to assign this Note, fill in the form below and have your
signature guaranteed:
I or we assign and transfer this Note to
--------------------------------------------------------------------------------
(Insert assignee's social security or tax ID number)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code) and irrevocably appoint
_ agent to transfer this Note on the books of the Company.
The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your signature:
----------- --------------------------
(Sign exactly as your
name appears on the
other side of this
Note)
Signature Guarantee:
-------------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-8
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 4.11 or 4.15 of the Indenture, check the Box: [ ]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.11 or 4.15 of the Indenture, state the amount: $
Date: Your Signature:
---------- ------------------
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:
-----------------------
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-9
EXHIBIT B
(FORM OF FACE OF SECURITY)
No. [ ] $ CUSIP NO.:00000XXX0
8.875% SENIOR SUBORDINATED DEBENTURE DUE 2027
THE AES CORPORATION promises to pay
to [ ] or registered assigns the
principal sum of[ ] Dollars on
November 1, 2027.
Interest Payment Dates: May 1, and November 1, and at maturity
Record Dates: April 15 or October 15 as the case may be, next preceding such
Interest Payment Date
By:
----------------------------
Authorized Signature
By:
----------------------------
Authorized Signature
Dated:
Certificate of Authentication
This is one of the 8.875% Senior Subordinated Debentures due 2027
referred to in the within-mentioned indenture.
The First National Bank
of Chicago, as Trustee
By:
----------------------------
Authorized Signatory
B-1
THE AES CORPORATION
8.875% SENIOR SUBORDINATED DEBENTURE DUE 2027
1. Interest. THE AES CORPORATION, a Delaware corporation (the
"Company," which definition shall include any successor thereto in accordance
with the Indenture (as defined below)), promises to pay, until the principal
hereof is paid or made available for payment, interest on the principal amount
set forth on the reverse side hereof at a rate of 8.875% per annum. Interest on
the Debentures will accrue from and including the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance through but excluding the date on which interest is paid. Interest
shall be payable in arrears on May 1,and November 1, and at the stated maturity
(each an "Interest Payment Date"), commencing May 1, 1998. Interest will be
computed on the basis of a 360 day year of twelve 30 day months.
2. Method of Payment. The Company will pay interest on the Debentures
(except defaulted interest) to the Persons who are registered Holders of
Debentures at the close of business on April 15 and October 15 next preceding
the Interest Payment Date. Holders must surrender Debentures to a Paying Agent
to collect principal payments. The Company will pay principal, premium, if any,
and interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. At the Company's option,
interest may be paid by check mailed to the registered address of the Holder of
this Debenture.
3. Paying Agent and Registrar. Initially, The First National Bank of
Chicago (the "Trustee") will act as Paying Agent and Registrar. The Company may
change any Paying Agent, Registrar or co-Registrar without notice. Neither the
Company nor any of its Subsidiaries may act as Paying Agent, Registrar or
co-Registrar.
4. Indenture. The Company issued the Debentures under an Indenture
dated as of October 29, 1997 (the "Indenture") between the Company and the
Trustee. This Debenture is one of an issue of Debentures of the Company issued
under the Indenture. The terms of the Debentures include those
B-2
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S. Code xx.xx. 77aaa-77bbbb) as amended from
time to time. The Debentures are subject to all such terms, and Securityholders
are referred to the Indenture and such Act for a statement of them. Capitalized
terms used herein and not otherwise defined have the meanings set forth in the
Indenture. The Debentures are general unsecured obligations of the Company
subordinated in right of payment to all Senior Debt of the Company. The
Indenture limits, among other things, the ability of the Company and its
Restricted Subsidiaries to incur certain Debt; pay dividends and make other
distributions; make certain investments; engage in unrelated businesses; dispose
of certain Assets; engage in transactions with certain Affiliates; and merge
with or into another entity. The limitations are subject to a number of
important qualifications and exceptions. The Company must report to the Trustee
annually whether it is in compliance with the limitations contained in the
Indenture.
5. Optional Redemption.
The Debentures are subject to redemption upon not less than 30 nor more than 60
days' notice by mail, at any time on or after November 1, 2004, as a whole or in
part, at the election of the Company, at a price equal to the sum of (i) 100% of
the principal amount thereof plus accrued interest to the Redemption Date plus
(ii) the Make-Whole Amount, if any.
The term "Make-Whole Amount" shall mean, in connection with any optional
redemption of any Debenture, the excess, if any, of (i) the aggregate present
value as of the date of such redemption of each dollar of principal being
redeemed and the amount of interest (exclusive of interest accrued to the
Redemption Date) that would have been payable in respect of such dollar if such
prepayment had not been made, determined by discounting, on a semiannual basis,
such principal and interest at the Reinvestment Rate (determined on the Business
Day preceding the date of such redemption) from the respective dates on which
such principal and interest would have been payable if such payment had not been
made, over (ii) the aggregate principal amount of the Debentures being redeemed.
The term "Reinvestment Rate" shall mean 0.50% (one-half of one percent) plus the
arithmetic mean of the yields under the respective headings "This Week" and
"Last Week" published in the Statistical Release under the caption "Treasury
Constant Maturities" for the maturity (rounded to the nearest month)
cor-
B-3
responding to the maturity of the principal being prepaid. If no maturity
exactly corresponds to such maturity, yields for the two published maturities
most closely corresponding to such maturity shall be calculated pursuant to the
immediately preceding sentence and the Reinvestment Rate shall be interpolated
or extrapolated from such yields on a straight-line basis, rounding in each of
such relevant periods to the nearest month. For the purpose of calculating the
Reinvestment Rate, the most recent Statistical Release published prior to the
date of determination of the Make-Whole Amount shall be used.
The term "Statistical Release" shall mean the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded U.S.
government securities adjusted to constant maturities or, if such statistical
release is not published at the time of any determination under the Indenture,
then such other reasonably comparable index which shall be designated by the
Company.
In addition prior to November 1, 2000, in the event that the Company
consummates one or more offerings of its Qualified Capital Stock, the Company
may at its option, use all or a portion of the proceeds therefrom to redeem up
to 33% of the original aggregate principal amount at maturity of the Debenturess
at a cash redemption price equal to 108.875% of the principal amount thereof,
plus accrued and unpaid interest thereon through the date of repurchase;
provided that at least $83.75 million of the original aggregate principal amount
of the Debentures remains outstanding thereafter.
6. Sinking Fund. The Debentures are subject to a Sinking Fund in the
amount and manner set forth in the Indenture.
7. Offers to Purchase. Section 4.11 of the Indenture provides upon the
occurrence of a Change of Control and subject to further limitations contained
therein, the Company shall make an offer to purchase the Securities in
accordance with the procedures set forth in the Indenture.
8. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay to
B-4
it any taxes and fees required by law or permitted by the Indenture. The
Registrar need not transfer or exchange any Security or portion of a Security
selected for redemption, or transfer or exchange any Securities for a period of
15 days before the mailing of a notice of redemption of Securities to be
redeemed.
9. Persons Deemed Owners. The registered holder of a Security may be
treated as the owner of it for all purposes.
10. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Company at its written request. After that, Holders entitled to the
money must look to the Company for payment as general creditors unless an
"abandoned property" law designates another Person.
11. Amendment, Supplement, Waiver. The Company and the Trustee may,
without the consent of the holders of any outstanding Securities, amend, waive
or supplement the Indenture, the Securities for certain specified purposes,
including, among other things, curing ambiguities, defects or inconsistencies,
maintaining the qualification of the Indenture under the Trust Indenture Act of
1939 or making any other change that does not adversely affect the rights of any
Holder. Other amendments and modifications of the Indenture or the Securities
may be made by the Company and the Trustee with the consent of the Holders of
not less than a majority of the aggregate principal amount of the outstanding
Securities, subject to certain exceptions requiring the consent of the Holders
of the particular Securities to be affected.
12. Successor Corporation. When a successor corporation assumes all
the obligations of its predecessor under the Securities and the Indenture and
the transaction complies with the terms of Article V of the Indenture, the
predecessor corporation, subject to certain exceptions, will be released from
those obligations.
13. Defaults and Remedies. Events of Default are set forth in the
Indenture. Subject to certain limitations in the Indenture, if an Event of
Default (other than an Event of Default specified in Section 6.1(f) or (g) of
the Indenture with respect to the Company) occurs and is continuing, then the
holders of not less than 25% in aggregate principal amount of the outstanding
Securities (or, in the case of an Event of Default specified in Section 6.1 (a)
or (b) of the Indenture, the
B-5
Holders of not less than 25% of the aggregate principal amount of the
outstanding Series so affected) may, or the Trustee may, declare the principal
of, premium, if any, plus accrued interest, if any, to be due and payable
immediately. If an Event of Default specified in Section 6.1(f) or (g) of the
Indenture with respect to the Company occurs and is continuing, the principal
of, premium, if any, and accrued interest on all of the Securities shall ipso
facto become and be immediately due and payable subject to the prior payment in
full of Senior Debt without any declaration or other act on the part of the
Trustee or any Holder. Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may require
indemnity reasonably satisfactory to it before it enforces the Indenture or the
Securities. Subject to certain limitations, Holders of a majority in principal
amount of the then outstanding Securities may direct the Trustee in its exercise
of any trust or power. The Trustee may withhold from Securityholders notice of
any continuing default (except a default in payment of principal or interest or
a failure to comply with Article V of the Indenture) if it determines that
withholding notice is in their interests. The Company must furnish an annual
compliance certificate to the Trustee.
14. Trustee Dealings with Company. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not Trustee.
15. No Recourse Against Others. A director, officer, employee,
stockholder or beneficiary, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of, such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. The waiver and release are part of the consideration for the
issue of the Securities.
16. Defeasance. The Indenture contains provisions (which provisions
apply to this Debenture) for defeasance at any time of (a) the entire
indebtedness of the Company or this Debenture and (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon
compliance by the Company with certain conditions set forth therein.
B-6
17. Authentication. This Debenture shall not be valid until the
Trustee signs the certificate of authentication on the other side of this
Debenture.
18. Abbreviations. Customary abbreviations may be used in the name of
a Securityholder or an assignee, such as: TEN COM (= tenants in common), TENANT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (=
Uniform Gifts to Minors Act).
19. Subordination. The Company's payment of principal of, premium, if
any, and interest on the Securities is subordinated in right of payment, to the
extent and in the manner provided in Article XI of the Indenture, to the prior
payment in full of the Senior Debt of the Company. Each Holder of the
Securities, by his acceptance hereof, covenants and agrees that all payments of
the principal of, premium, if any, and interest on the Securities by the Company
shall be subordinated in accordance with the provisions of Article XI of the
Indenture, and each Holder accepts and agrees to be bound by such provisions.
19. GOVERNING LAW. THE INDENTURE AND THIS DEBENTURE SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
The Company will furnish to any Securityholder upon written request
and without charge a copy of the Indenture. Requests may be made to:
THE AES CORPORATION
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: General Counsel
B-7
ASSIGNMENT FORM
If you the holder want to assign this Debenture, fill in the form below and have
your signature guaranteed:
I or we assign and transfer this Debenture to
--------------------------------------------------------------------------------
(Insert assignee's social security or tax ID number)
----------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code) and irrevocably
appoint agent to transfer this Debenture on the books of the
Company. The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your signature:
---------------- -----------------------------------
(Sign exactly as your
name appears on the
other side of this
Debenture)
Signature Guarantee:
-------------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Debenture Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
B-8
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Debenture purchased by the Company pursuant
to Section 4.11 or 4.15 of the Indenture, check the Box: [ ]
If you wish to have a portion of this Debenture purchased by the
Company pursuant to Section 4.11 or 4.15 of the Indenture, state the amount:
$
-------------
Date: Your Signature:
---------- -------------------------
(Sign exactly as your name appears on the other side of this Debenture)
Signature Guarantee:
------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Debenture Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
B-9
EXHIBIT C
FORM OF CERTIFICATE OF TRANSFER
The AES Corporation
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
[Name and Address of Registrar]
Re: 8.50% Senior Subordinated Notes due 2007
8.875% Senior Subordinated Debentures due 2027
Reference is hereby made to the Indenture, dated as of October 29,
1997 (the "Indenture"), between The AES Corporation (the "Issuer") and The First
National Bank of Chicago, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
, (the "Transferor") owns and proposes to transfer the
Security[s] specified in Annex A hereto in the principal amount of $ in such
Security[s] (the "Transfer"), to (the "Transferee"), as further
specified in Annex A hereto. In the event that Transferor holds Physical
Securities, this Certificate is accompanied by one or more certificates
aggregating at least the principal amount of Securities proposed to be
Transferred. In connection with the Transfer, the Transferor hereby certifies
that:
1. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE 144A GLOBAL SECURITY.
The Transfer is being effected pursuant to and in accordance with Rule 144A
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
Securities are being transferred to a Person that the Transferor reasonably
believes is purchasing the Securities for its own account, or for one or more
accounts with respect to which such Person exercises sole investment discretion,
and such Person and each such account is a "qualified institutional buyer"
within the meaning of Rule 144A in a transaction meeting the requirements of
Rule 144A and such Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
C-1
Security will be subject to the restrictions on transfer enumerated in the
Securities Act Legend and in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE REGULATION S GLOBAL
SECURITY PURSUANT TO REGULATION S. The Transfer is being effected pursuant to
and in accordance with Rule 904 under the Securities Act and, accordingly, the
Transferor hereby further certifies that (i) the Transfer is not being made to a
person in the United States and (x) at the time the buy order was originated,
the Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 904(b) of Regulation
S under the Securities Act and (iii) the transaction is not part of a plan or
scheme to evade the registration requirements of the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the Security will be subject to the restrictions on Transfer
enumerated in the Securities Act Legend printed on the Regulation S Global
Security and in the Indenture and the Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A RESTRICTED
PHYSICAL SECURITY PURSUANT TO RULE 144A OR REGULATION S. One or more of the
events specified in Section 2.6(a) of the Indenture have occurred and the
Transfer is being effected in compliance with the transfer restrictions
applicable to Securities bearing the Securities Act Legend and pursuant to and
in accordance with the Securities Act, and accordingly the Transferor hereby
further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144A under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 1 above; or
(b) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 904 under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 2 above.
C-2
4. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE UNRESTRICTED GLOBAL
SECURITY The Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture, and the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transfer Securities will no
longer be subject to the restrictions on transfer enumerated in the Securities
Act Legend and in the Indenture and the Securities Act.
5. [ ] CHECK IF TRANSFEREE WILL TAKE AN INTEREST IN THE PHYSICAL GLOBAL SECURITY
THAT DOES NOT BEAR THE SECURITIES ACT LEGEND One or more of the events specified
in Section 2.6(a) of the Indenture have occurred and the Transfer is being
effected pursuant to and in accordance with Rule 144 under the Securities Act
and in compliance with the transfer restrictions contained in the Indenture, and
the restrictions on transfer contained in the Indenture and the Securities Act
Legend are not required in order to maintain compliance with the Securities Act.
Upon consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred Securities will no longer be subject to the
restrictions on transfer enumerated in the Securities Act Legend and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Guarantors.
-----------------------------------
[Insert Name of Transferor]
By:
--------------------------------
Name:
Title:
Dated:
----------------
C-3
FORM OF ANNEX A TO CERTIFICATE
OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] Interests in the
(i) [ ] 144A Global Security (CUSIP ), or
(ii)[ ] Regulation S Global Security (CINS ).
(b) [ ]Physical Security.
Representing:
[CHECK ONE OF (a) OR (b)]
(a)[ ] 8.50% Senior Subordinated Notes due 2007
(b)[ ] 8.875% Senior Subordinated Debentures due 2027
2. That the Transferee will hold:
[CHECK ONE]
(a) [ ] Interests in the:
(i) [ ] 144A Global Security (CUSIP ), or
(ii) [ ] Regulation S Global Security (CINS ), or
(iii) [ ] Unrestricted Global Security (CUSIP ); or
(b) [ ] Physical Securities that bear the Securities Act
Legend;
(c) [ ] Physical Securities that do not bear the
Securities Act Legend;
in accordance with the terms of the Indenture.
C-4
EXHIBIT D
FORM OF CERTIFICATE OF EXCHANGE
The AES Corporation
0000 Xxxxx 00xx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
[Name and Address of Registrar]
Re: 8.50% Senior Subordinated Notes due 2007
8.875% Senior Subordinated Notes due 2027
Reference is hereby made to the Indenture, dated as of October 29, 1997 (the
"Indenture"), between The AES Corporation (the "Issuer") and The First National
Bank of Chicago, as trustee. Capitalized terms used but not defined herein shall
have the meanings given to them in the Indenture.
, (the "Holder") owns and proposes to exchange the
Security[s] specified herein, in the principal amount of $ in such
Security[s] (the "Exchange"). In the event Holder holds Physical Securities,
this Certificate is accompanied by one or more certificates aggregating at least
the principal amount of Securities proposed to be Exchanged. In connection with
the Exchange, the Holder hereby certifies that:
1. EXCHANGE OF RESTRICTED PHYSICAL SECURITIES OR INTERESTS IN THE INITIAL GLOBAL
SECURITY FOR PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT LEGEND OR
UNRESTRICTED GLOBAL SECURITIES
(a) [ ] CHECK IF EXCHANGE IS FROM INITIAL GLOBAL SECURITIES TO THE
UNRESTRICTED GLOBAL SECURITY. In connection with the Exchange of the Holder's
Initial Global Security to the Unrestricted Global Security in an equal
principal amount, the Holder hereby certifies (i) the Unrestricted Global
Securities are being acquired for the Holder's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Initial Global Securities and pursuant to and in
accordance with the Securities Act of 1933, as amended (the "Securities Act")
and (iii) the restrictions on transfer contained in the Indenture
D-1
and the Securities Act Legend are not required in order to maintain compliance
with the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO AN
INTEREST IN THE UNRESTRICTED GLOBAL SECURITY. In connection with the Holder's
Exchange of Restricted Physical Securities for Interest in the Unrestricted
Global Security, (i) the Interest in the Unrestricted Global Security are being
acquired for the Holder's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to
Restricted Physical Securities and pursuant to and in accordance with the
Securities Act and (iii) the restrictions on transfer contained in the Indenture
and the Securities Act Legend are not required in order to maintain compliance
with the Securities Act.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO
PHYSICAL SECURITIES THAT DO NOT BEAR THE SECURITIES ACT LEGEND. In connection
with the Holder's Exchange of a Restricted Physical Security for Physical
Securities that do not bear the Securities Act Legend, the Holder hereby
certifies (i) the Physical Securities that do not bear the Securities Act Legend
are being acquired for the Holder's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Physical Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act and (iv) one or more of the events specified
in Section 2.6(a) of the Indenture have occurred.
2. [ ] CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITIES TO INTERESTS IN
AN INITIAL GLOBAL SECURITY . In connection with the Exchange of the Holder's
Restricted Physical Debenture for interests in the Initial Global Security in
the [CHECK ONE] [ ] 144A Global Security, [ ] Regulation S Global Security, with
an equal principal amount, (i) the interests in the Initial Global Security are
being acquired for the Holder's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Physical Security and pursuant to and in accordance
with the Securities Act. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Initial Global Security issued
will be subject to the restrictions on transfer enumerated in the Securities Act
Leg-
end printed on the Initial Global Securities and in the Indenture and the
Securities Act.
The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a)[ ] 8.50% Senior Subordinated Notes due 2007
(b)[ ] 8.875% Senior Subordinated Debentures due 2027
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
[Insert Name of Holder]
By:
Name:
Title:
Dated:
-----------------
