EXHIBIT 4.4
Execution Version
________________________________________________________________________________
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
AND
CCFC FINANCE CORP.
and each of the Guarantors named herein
SECOND PRIORITY SENIOR SECURED FLOATING RATE NOTES DUE 2011
INDENTURE
Dated as of August 14, 2003
_____________________________
Wilmington Trust FSB
Trustee
______________________________
________________________________________________________________________________
CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310(a)(1)................................. 7.10
(a)(2)................................. 7.10
(a)(3)................................. N.A.
(a)(4)................................. N.A.
(a)(5)................................. 7.10
(b).................................... 7.10
(c).................................... N.A.
311(a).................................... 7.11
(b).................................... 7.11
(c).................................... N.A.
312(a).................................... 2.05
(b).................................... 12.03
(c).................................... 12.03
313(a).................................... 7.06
(b)(1)................................. 10.03
(b)(2)................................. 7.06; 7.07
(c).................................... 7.06; 10.03; 12.02
(d).................................... 7.06
314(a).................................... 4.03;12.02; 12.05
(b).................................... 10.02
(c)(1)................................. 12.04
(c)(2)................................. 12.04
(c)(3)................................. N.A.
(d).................................... 10.03, 10.04, 10.05
(e).................................... 12.05
(f).................................... N.A.
315(a).................................... 7.01
(b).................................... 7.05,12.02
(c).................................... 7.01
(d).................................... 7.01
(e).................................... 6.11
316(a) (last sentence).................... 2.09
(a)(1)(A).............................. 6.05
(a)(1)(B).............................. 6.04
(a)(2)................................. N.A.
(b).................................... 6.07
(c).................................... 2.12
317(a)(1)................................. 6.08
(a)(2)................................. 6.09
(b).................................... 2.04
318(a).................................... 12.01
(b).................................... N.A.
(c).................................... 12.01
N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions..................................................1
Section 1.02 Other Definitions...........................................24
Section 1.03 Incorporation by Reference of Trust Indenture Act...........24
Section 1.04 Rules of Construction.......................................25
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating.............................................25
Section 2.02 Execution and Authentication................................26
Section 2.03 Registrar and Paying Agent..................................27
Section 2.04 Paying Agent to Hold Money in Trust.........................27
Section 2.05 Holder Lists................................................27
Section 2.06 Transfer and Exchange.......................................27
Section 2.07 Replacement Notes...........................................38
Section 2.08 Outstanding Notes...........................................38
Section 2.09 Treasury Notes..............................................38
Section 2.10 Temporary Notes.............................................38
Section 2.11 Cancellation................................................39
Section 2.12 Defaulted Interest..........................................39
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee..........................................39
Section 3.02 Selection of Notes to Be Redeemed or Purchased..............39
Section 3.03 Notice of Redemption........................................40
Section 3.04 Effect of Notice of Redemption..............................41
Section 3.05 Deposit of Redemption or Purchase Price.....................41
Section 3.06 Notes Redeemed or Purchased in Part.........................41
Section 3.07 Optional Redemption.........................................41
Section 3.08 Mandatory Redemption........................................42
Section 3.09 Offer to Purchase by Application of Net Proceeds............42
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes............................................44
Section 4.02 Maintenance of Office or Agency.............................44
Section 4.03 Reports.....................................................44
Section 4.04 Compliance Certificate......................................45
Section 4.05 Taxes.......................................................46
Section 4.06 Stay, Extension and Usury Laws..............................46
Section 4.07 Restricted Payments.........................................46
Section 4.08 Dividend and Other Payment Restrictions Affecting
Subsidiaries.............................................47
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred
Equity...................................................48
Section 4.10 Asset Sales.................................................50
i
Section 4.11 Transactions with Affiliates................................51
Section 4.12 Liens.......................................................52
Section 4.13 Business Activities.........................................52
Section 4.14 Corporate Existence.........................................53
Section 4.15 Offer to Repurchase Upon Change of Control..................53
Section 4.16 Limitation on Issuances and Sales of Equity Interests in
Subsidiaries.............................................55
Section 4.17 Payments for Consent........................................55
Section 4.18 Hillabee Facility...........................................55
Section 4.19 Restrictions on Activities of Finance Corp..................56
Section 4.20 Deposit of Revenues.........................................56
Section 4.21 Additional Subsidiaries.....................................56
Section 4.22 Maintenance of Insurance....................................56
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets....................56
Section 5.02 Successor Corporation Substituted...........................57
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default...........................................57
Section 6.02 Acceleration................................................59
Section 6.03 Other Remedies..............................................60
Section 6.04 Waiver of Past Defaults.....................................60
Section 6.05 Control by Majority.........................................60
Section 6.06 Limitation on Suits.........................................60
Section 6.07 Rights of Holders of Notes to Receive Payment...............61
Section 6.08 Collection Suit by Trustee..................................61
Section 6.09 Trustee May File Proofs of Claim............................61
Section 6.10 Priorities..................................................62
Section 6.11 Undertaking for Costs.......................................62
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee...........................................62
Section 7.02 Rights of Trustee...........................................63
Section 7.03 Individual Rights of Trustee................................64
Section 7.04 Trustee's Disclaimer........................................64
Section 7.05 Notice of Defaults..........................................64
Section 7.06 Reports by Trustee to Holders of the Notes..................64
Section 7.07 Compensation and Indemnity..................................65
Section 7.08 Replacement of Trustee......................................65
Section 7.09 Successor Trustee by Merger, etc............................66
Section 7.10 Eligibility; Disqualification...............................66
Section 7.11 Preferential Collection of Claims Against Company...........67
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance....67
Section 8.02 Legal Defeasance and Discharge..............................67
Section 8.03 Covenant Defeasance.........................................67
ii
Section 8.04 Conditions to Legal or Covenant Defeasance..................68
Section 8.05 Deposited Money and Government Securities to be Held in
Trust; Other Miscellaneous Provisions....................69
Section 8.06 Repayment to Company........................................69
Section 8.07 Reinstatement...............................................70
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.........................70
Section 9.02 With Consent of Holders of Notes............................71
Section 9.03 Compliance with Trust Indenture Act.........................72
Section 9.04 Revocation and Effect of Consents...........................73
Section 9.05 Notation on or Exchange of Notes............................73
Section 9.06 Trustee to Sign Amendments, etc.............................73
ARTICLE 10.
COLLATERAL AND SECURITY
Section 10.01 Equal and Ratable Sharing of Collateral by Holders of
Parity Lien Debt; Sharing Confirmation...................73
Section 10.02 Ranking of Note Liens.......................................74
Section 10.03 Relative Rights.............................................74
Section 10.04 Release of Security Interest in Respect of Notes............75
ARTICLE 11.
SUBSIDIARY GUARANTEES
Section 11.01 Guarantee...................................................75
Section 11.02 Limitation on Guarantor Liability...........................76
Section 11.03 Execution and Delivery of Subsidiary Guarantee..............77
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms..........77
Section 11.05 Releases Following Sale of Assets...........................78
ARTICLE 12.
satisfaction and discharge
Section 12.01 Satisfaction and Discharge..................................78
Section 12.02 Application of Trust Money..................................79
EXHIBITS AND SCHEDULES
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL
ACCREDITED INVESTOR
Exhibit E FORM OF NOTATION OF SUBSIDIARY GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
Exhibit G Forms of Subordination
Attachment A: FORM OF SUBORDINATION AGREEMENT
Attachment B: WORKING CAPITAL FACILITY
Schedule A MORTGAGES AND DEEDS OF TRUST
iii
INDENTURE dated as of August 14, 2003 among Calpine Construction Finance
Company, L.P., a Delaware limited partnership (the "Company"), CCFC Finance
Corp. a Delaware corporation ("Finance Corp."), the Guarantors (as defined) and
Wilmington Trust FSB, as trustee (the "Trustee").
As set forth in Section 13.07 below and notwithstanding anything to the
contrary set forth in this Indenture, the Notes, any Security Document or any
other Note Document, the Notes and the Subsidiary Guarantees are non-recourse
secured obligations of the Company and Guarantors, respectively. The Company,
Finance Corp., the Guarantors and the Trustee agree as follows for the benefit
of each other and for the equal and ratable benefit of the Holders (as defined)
of the Second Priority Senior Secured Floating Rate Notes due 2011 (the
"Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the form of Exhibit
A-1 hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified
Person, whether or not such Indebtedness is incurred in connection with, or
in contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Act of Controlling Lien Holders" means (1) at any time prior to the
Discharge of Priority Lien Obligations, an Act of Priority Lien Holders, and (2)
at any time after the Discharge of Priority Lien Obligations, an Act of Parity
Lien Holders.
"Act of Parity Lien Holders" means, as to any matter at any time, a
direction in writing delivered to the Collateral Agent by or with the written
consent of the holders of Parity Lien Debt holding more than 50% of the
aggregate outstanding principal amount of all Parity Lien Debt that is then due
and payable, voting together as a single class which direction shall state that
the undersigned has obtained or the undersigned constitutes, as applicable, more
than 50% of such debt. For this purpose, Parity Lien Debt registered in the name
of, or beneficially owned by, the Company or any Affiliate of the Company will
be deemed not to be outstanding.
"Act of Priority Lien Holders" means, as to any matter at any time, a
direction in writing delivered to the Collateral Agent by or with the written
consent of the holders of Priority Lien Debt holding more than 50% of the
aggregate outstanding principal amount of all Priority Lien Debt that is then
due and payable, voting together as a single class which direction shall state
that the undersigned has obtained or the undersigned constitutes, as applicable,
more than 50% of such debt. For this purpose, Priority Lien Debt registered in
the name of, or beneficially owned by, the Company or any Affiliate of the
Company will be deemed not to be outstanding.
1
"Actionable Default" means any event of default under a Secured Debt
Document entitling the Collateral Agent or any Secured Party to exercise
remedies with respect to the Collateral or the Subsidiary Guarantees.
"Additional Notes" means up to $50.0 million aggregate principal amount of
Notes (other than the Initial Notes) issued under this Indenture in accordance
with Sections 2.02 and 4.09 hereof, as part of the same series as the Initial
Notes.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"Applicable Note Eurodollar Rate" means, for each interest period during
which any Note is outstanding subsequent to the initial interest period, 850
basis points over the rate determined by the Company (notice of such rate to be
sent to the Trustee by the Company on the date of determination thereof) equal
to the greater of (x) 1.25% or (y) the applicable British Bankers' Association
LIBOR rate for deposits in U.S. dollars for a period of six months as reported
by any generally recognized financial information service as of 11:00 a.m.
(London time) two business days prior to the first day of such interest period;
provided that, if no such British Bankers' Association LIBOR rate is available
to the Company, the Applicable Note Eurodollar Rate for the relevant interest
period shall instead be the rate at which Xxxxxxx Xxxxx Credit Partners L.P. or
one of its affiliate banks offers to place deposits in U.S. dollars with
first-class banks in the London interbank market for a period of six months at
approximately 11:00 a.m. (London time) two business days prior to the first day
of such interest period, in amounts equal to $1.0 million. Notwithstanding the
foregoing, the Applicable Note Eurodollar Rate for the initial interest period
will be 9.75%.
"Applicable Premium" means, with respect to any Note on any redemption
date, the greater of:
(1) 1.0% of the principal amount of the Note; or
(2) the excess of:
(a) the present value at such redemption date of (i) the
redemption price of the Note at August 26, 2009 (such redemption price
being set forth in the table appearing in Section 3.07 herein) plus
(ii) all required interest payments due on the Note through August 26,
2009 (excluding accrued but unpaid interest to the redemption date),
computed using a discount rate equal to the Applicable Note Eurodollar
Rate as of such redemption date less 850 basis points; over
(b) the principal amount of the Note.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depositary, Euroclear and Clearstream that apply to such transfer or exchange.
2
"Asset Sale" means:
(1) the sale, lease, conveyance or other disposition of any assets or
rights; provided that the sale, conveyance or other disposition of all or
substantially all of the assets of the Company and its Subsidiaries taken
as a whole will be governed by the provisions of this Indenture described
under Section 5.01 hereof and not by the provisions of the Asset Sale
covenant; and
(2) the issuance of Equity Interests in any of the Company's
Subsidiaries or the sale of Equity Interests in any of its Subsidiaries.
Notwithstanding the preceding, none of the following items will be deemed
to be an Asset Sale:
(1) any single transaction or series of related transactions that
involves assets having a Fair Market Value of less than $10.0 million;
(2) a transfer of assets between or among the Company and its
Subsidiaries,
(3) an issuance of Equity Interests by a Subsidiary to the Company or
to a Subsidiary of the Company;
(4) the sale or lease of products, services or accounts receivable in
the ordinary course of business and any sale or other disposition of
damaged, worn-out or obsolete assets in the ordinary course of business;
(5) the sale or other disposition of cash or Cash Equivalents;
(6) a Restricted Payment that does not violate the covenant described
under Section 4.07 hereof or a Permitted Investment;
(7) the Hillabee Disposition; and
(8) an issuance of Equity Interests in the Company in accordance with
the terms of this Indenture.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or state
law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and
Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as that term is used in Section 13 (d) (3)
of the Exchange Act) , such "person" will be deemed to have beneficial ownership
of all securities that such "person" has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time. The terms "Beneficially Owns" and
"Beneficially Owned" have a corresponding meaning.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of the
corporation or any committee thereof duly authorized to act on behalf of
such board;
(2) with respect to a partnership, the Board of Directors of the
general partner of the partnership or any committee duly authorized and
empowered to take action on behalf of such partnership by the partnership
agreement of such partnership;
3
(3) with respect to a limited liability company, the managing member
or members or any controlling committee of managing members thereof; and
(4) with respect to any other Person, the board or committee of such
Person serving a similar function.
"Business Day" means any day other than a Legal Holiday.
"Calpine Performance Guarantee" means the Affiliated Party Agreement
Guaranty, dated as of the date hereof, by and among Calpine Corporation, Calpine
Construction Finance Company, L.P. and Hermiston Power Partnership.
"Calpine Project Undertaking" means the Project Undertaking and Agreement,
dated as of the date hereof, by and between Calpine Corporation, Calpine
Construction Finance Company, L.P. and Hermiston Power Partnership.
"Capital Lease Obligation" means, at the time any determination is to be
made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP, and the Stated Maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be prepaid by the lessee without payment of a penalty.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership interests (whether general or limited) or membership interests;
and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person, but excluding from all of the foregoing any
debt securities convertible into Capital Stock, whether or not such debt
securities include any right of participation with Capital Stock.
"Cash Equivalents" means:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality of the United
States government (provided that the full faith and credit of the United
States is pledged in support of those securities) having maturities of not
more than six months from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case, with any domestic commercial bank having capital
and surplus in excess of $500.0 million and a Thomson Bank Watch (or
successor rating agency) Rating of "B" or better;
4
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications
specified in clause (3) above;
(5) commercial paper having one of the two highest ratings obtainable
from Xxxxx'x Investors Service, Inc. (or any successor rating agency) or
Standard & Poor's Rating Services (or any successor rating agency) and in
each case maturing within six months after the date of acquisition; and
(6) money market funds at least 95% of the assets of which constitute
Cash Equivalents of the kinds described in clauses (1) through (5) of this
definition.
"Casualty Event" means any damage to or destruction of a Facility in excess
of $10.0 million.
"Change of Control" means the occurrence of any of the following:
(1) the adoption of a plan relating to the liquidation or dissolution
of the Company;
(2) the consummation of any transaction (including any merger or
consolidation) the result of which is that any "person" (as that term is
used in Section 13(d) of the Exchange Act) becomes the Beneficial Owner,
directly or indirectly, of more than 50% of the Voting Stock of Calpine
Corporation, measured by voting power rather than number of shares;
(3) the consummation of any transaction (including any merger or
consolidation) the result of which is that any "person" (as that term is
used in Section 13(d) of the Exchange Act), other than Calpine Corporation
or any Wholly Owned Subsidiary of Calpine Corporation, becomes the
Beneficial Owner, directly or indirectly, of more than 50% of the Voting
Stock of the Company, measured by voting power rather than number of
shares; or
(4) the first day on which the Company fails to own, directly or
indirectly, 100% of the issued and outstanding Equity Interests of CCFC
Finance Corp.
"Clearstream" means Clearstream Banking, S.A.
"Closing Date Facilities" means the Hermiston facility, the Hillabee
facility, the Lost Pines facility, the Magic Valley facility, the Ontelaunee
facility, the Osprey facility, the Xxxxxx facility and the Xxxxxxxxx facility.
"Collateral" means all collateral in which a Lien is granted to the
Collateral Agent in the Security Documents.
"Collateral Agent" means Wilmington Trust Company, in its capacity as
collateral agent for the Secured Parties under the Security Documents, together
with its successors in such capacity.
"Collateral Trust Agreement" means the Collateral Trust Agreement, dated as
of the date hereof, by and among the Parents, the Company, Finance Corp., the
Guarantors, the Trustee, the Term Loan Administrative Agent and the Collateral
Agent.
"Condemnation Event" means any Facility (or any portion thereof in excess
of $10.0 million) is condemned, confiscated, requisitioned, captured, seized or
subjected to forfeiture, or title thereto is taken, by any governmental
authority (or any Person acting under color of governmental authority).
5
"Control Agreement" means the Collateral Account Control Agreement, dated
as of the date hereof, by and between the Company and the Collateral Agent.
"Corporate Trust Office of the Trustee" will be at the address of the
Trustee specified in Section 13.02 hereof or such other address as to which the
Trustee may give notice to the Company.
"Credit Facilities" means one or more debt facilities or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
(including by means of sales of debt securities to institutional investors) in
whole or in part from time to time.
"Custodian" means the Trustee, as custodian with respect to the Notes in
global form, or any successor entity thereto.
"Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of Exhibit A1 hereto except that such Note shall not bear the Global
Note Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in whole
or in part in global form, the Person specified in Section 2.03 hereof as the
Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Designated Asset Disposition" means an Asset Sale made in connection with
(1) the exercise by GenTex of one of its purchase options under the
participation agreement dated September 2, 1999 between us and GenTex, (2) the
exercise by Magic Valley Electric Cooperative Inc. of its purchase option under
the power purchase and sale agreement dated May 22, 1998 between the Company and
Magic Valley Electric Cooperative Inc. or (3) the sale or transfer to CES of the
Service Agreement for Point-To-Point Transmission Service between the Company
(as assignee of CES) and Tampa Electric Company (provided that, concurrently
with such sale or transfer, CES grants a security interest in such agreement to
the Company to secure CES's obligations under the Index Based Gas Sale and Power
Purchase Agreement and a consent is obtained from Tampa Electric Company), in
each case as amended from time to time in accordance with the terms of the
Secured Debt Documents.
"Discharge of Priority Lien Obligations" means the occurrence of all of the
following: (1) termination of all commitments to extend credit that would
constitute Priority Lien Debt; (2) payment in full in cash of the principal of
and interest and premium (if any) on all Priority Lien Debt (other than any
undrawn letters of credit); (3) discharge or cash collateralization (at 105% of
the aggregate undrawn amount) of all outstanding letters of credit constituting
Priority Lien Debt and (4) payment in full in cash of all other Priority Lien
Obligations that are outstanding and unpaid at the time the Priority Lien Debt
is paid in full in cash (other than any obligations for taxes, costs,
indemnifications, reimbursements, damages and other liabilities in respect of
which no claim or demand for payment has been made at such time).
6
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with the covenant described under Section 4.07 hereof. The
amount of Disqualified Stock deemed to be outstanding at any time for purposes
of this Indenture will be the maximum amount that the Company and its
Subsidiaries may become obligated to pay upon the maturity of, or pursuant to
any mandatory redemption provisions of, such Disqualified Stock, exclusive of
accrued dividends.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the Euroclear
system.
"Excess Cash Flow" means, for any period:
(1) (a) all revenues received by the Company and its Subsidiaries
during such period and (b) all Net Proceeds of Asset Sales, Casualty Events
and Condemnation Events remaining after application of such proceeds in
accordance with the covenant described in Section 4.10 received by the
Company and its Subsidiaries during such period, less
(2) the sum of:
(A) all costs, expenses, fees and other charges (including
liquidated damages or other damages or penalties) incurred by the
Company and its Subsidiaries during such period in connection with the
ownership, operation, maintenance and use of the Facilities, including
all payments under Major Project Documents and other agreements
relating to the Facilities,
(B) all trustee fees, collateral agent fees and other similar
administrative fees and expenses paid by the Company and its
Subsidiaries during such period,
(C) the Fixed Charges of the Company and its Subsidiaries for
such period,
(D) all amounts paid by the Company and its Subsidiaries for
capital expenditures to the Facilities during such period, and
(E) all Permitted Payments to Parent made by the Company and its
Subsidiaries during such period.
"Excluded Assets" means:
(1) the fixtures and equipment relating to any Facility if, to the
extent that and for so long as (A) the ownership or operation of such
Facility is regulated by any federal or state regulatory authority and (B)
under the law applicable to such regulatory authority the grant of a
security
7
interest in such fixtures and equipment is prohibited or a security
interest in such fixtures and equipment may be granted only after
completion of a filing with, or receipt of consent from, such regulatory
authority which has not been effectively completed or received; provided,
that (i) such fixtures and equipment will be an Excluded Asset only to the
extent and for so long as the conditions set forth in clauses (A) and (B)
in this clause (1) are and remain satisfied and to the extent such assets
otherwise constitute Collateral, will cease to be an Excluded Asset, and
will become subject to the security interests granted to the Collateral
Agent under the Security Documents, immediately and automatically at such
time as such conditions cease to exist, including by reason of the
effective completion of any required filing or effective receipt of any
required regulatory approval, and (ii) unless prohibited by law, the
proceeds of any sale, lease or other disposition of any such fixtures or
equipment that are Excluded Assets shall not be an Excluded Asset and shall
at all times be and remain subject to the security interests granted to the
Collateral Agent under the Security Documents except as such proceeds are
applied and used by the Company or its Subsidiaries in the ordinary course
of business and applied in accordance with the covenant described under
Section 4.10 hereof.
(2) with respect to personal property, any lease, license, permit,
franchise, power, authority or right if, to the extent that and for so long
as (A) the grant of a security interest therein constitutes or would result
in the abandonment, invalidation or unenforceability of such lease,
license, permit, franchise, power, authority or right or the termination of
or a default under the instrument or agreement by which such lease,
license, permit, franchise, power, authority or right is governed and (B)
such abandonment, invalidation, unenforceability, termination or default is
not rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409
of the Uniform Commercial Code (or any successor provisions) of any
relevant jurisdiction or any other applicable law (including the United
States bankruptcy code); provided, that (i) such lease, license, permit,
franchise, power, authority or right will be an Excluded Asset only to the
extent and for so long as the conditions set forth in clauses (A) and (B)
of this clause (2) are and remain satisfied and to the extent that such
assets otherwise constitute Collateral, will cease to be an Excluded Asset,
and will become subject to the security interests granted to the Collateral
Agent under the Security Documents, immediately and automatically at such
time as such conditions cease to exist, including by reason of any waiver
or consent under the applicable instrument or agreement, and (ii) the
proceeds of any sale, lease or other disposition of any such lease,
license, permit, franchise, power, authority or right that is or becomes an
Excluded Asset shall not be an Excluded Asset and shall at all times be and
remain subject to the security interests granted to the Collateral Agent
under the Security Documents except as such proceeds are applied and used
by the Company or its Subsidiaries in the ordinary course of business and
applied in accordance with the covenant described under Section 4.10
hereof.
(3) with respect to any real property, any lease, license, permit,
franchise, power, authority or right if, to the extent that and for so long
as the grant of a security interest therein constitutes or would result in
the abandonment, invalidation or unenforceability of such lease, license,
permit, franchise, power, authority or right or the termination of or a
default under the instrument or agreement by which such lease, license,
permit, franchise, power, authority or right is governed; provided, that
such lease, license, permit, franchise, power, authority or right will be
an Excluded Asset only to the extent and for as long as the condition set
forth above is and remains satisfied and to the extent such assets
otherwise constitute Collateral, will cease to be an Excluded Asset, and
will become subject to the security interests granted to the Collateral
Agent under the Security Documents except as such proceeds are applied and
used by the Company or its Subsidiaries in the ordinary course of business
and applied in accordance with the covenant described under Section 4.10
hereof.
8
(4) all real property associated with the Hillabee Facility; and
(5) The Company's rights under or with respect to the Working Capital
Facility.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Facilities" means the Closing Date Facilities and any other electric
generating facilities acquired or constructed after the closing of the Notes
described in the definition of Permitted Business.
"Fair Market Value" means the value that would be paid by a willing buyer
to a willing seller in a transaction not involving distress or necessity of
either party, determined in good faith by the Board of Directors of the Company
(unless otherwise provided in this Indenture).
"Fixed Charges" means, with respect to any specified Person for any period,
the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Subsidiaries for such period, whether paid or accrued, including
amortization of debt issuance costs and original issue discount, non-cash
interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings,
and net of the effect of all payments made or received pursuant to Hedging
Obligations in respect of interest rates, plus one-third of all payments
with respect to operating leases, but excluding the consolidated interest
expense of such Person and its Subsidiaries for such period, whether paid
or accrued, under any Subordinated Indebtedness other than Subordinated
Indebtedness under the Working Capital Facility; plus
(2) the consolidated interest of such Person and its Subsidiaries that
was capitalized during such period, but excluding the consolidated
capitalized interest of such Person and its Subsidiaries for such period
under any Subordinated Indebtedness other than Subordinated Indebtedness
under the Working Capital Facility; plus
(3) any interest accruing on Indebtedness of another Person that is
guaranteed by such Person or one of its Subsidiaries or secured by a Lien
on assets of such Person or one of its Subsidiaries, whether or not such
Guarantee or Lien is called upon; plus
(4) the product of (a) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred equity of such Person or
any of its Subsidiaries, other than dividends on Equity Interests payable
solely in Equity Interests of the Company (other than Disqualified Stock)
or to the Company or a Subsidiary of the Company, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the
effective combined federal, state and local statutory tax rate of such
Person for the immediately preceding fiscal year, expressed as a decimal,
in each case, on a consolidated basis and determined in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in the
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as have been approved by a
significant segment of the accounting profession, which are in effect on the
applicable date of determination.
9
"GenTex" means GenTex Power Corporation.
"Global Notes" means, individually and collectively, each of the Restricted
Global Notes and the Unrestricted Global Notes, substantially in the form of
Exhibit A hereto issued in accordance with Section 2.01, 2.06(b)(3), 2.06(b)(4),
2.06(d)(2) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section 2.06(g)(2),
which is required to be placed on all Global Notes issued under this Indenture.
"Government Securities" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Governmental Authority" means any federal, state, municipal, national or
other government, governmental department, commission, board, bureau, court,
agency or instrumentality or political subdivision thereof or any entity or
officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.
"Governmental Rule" means any law, rule, regulation, ordinance, order, code
interpretation, treaty, judgment, decree, directive, guidelines, policy or
similar form of decision of any Governmental Authority.
"Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, by way of a pledge of assets or through
letters of credit or reimbursement agreements in respect thereof, of all or any
part of any Indebtedness (whether arising by virtue of partnership arrangements,
or by agreements to keep-well, to purchase assets, goods, securities or
services, to take or pay or to maintain financial statement conditions or
otherwise).
"Guarantors" means each of:
(1) Calpine Hermiston, LLC, a Delaware limited liability company, CPN
Hermiston, LLC, a Delaware limited liability company, and Hermiston Power
Partnership, an Oregon general partnership; and
(2) any other Subsidiary of the Company that executes a Subsidiary
Guarantee in accordance with the provisions of this Indenture;
and their respective successors and assigns.
"Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:
(1) interest rate swap agreements (whether from fixed to floating or
from floating to fixed) , interest rate cap agreements and interest rate
collar agreements;
(2) other agreements or arrangements designed to manage interest rate
risk; and
(3) other agreements or arrangements designed to protect such Person
against fluctuations in currency exchange rates or commodity prices.
10
"Hillabee Disposition" means a sale, transfer or other disposition by the
Company of all assets or substantially all assets related to the Hillabee
Facility, provided that (a) the transferee is not a Subsidiary of the Company,
(b) the disposition involves an assumption by the transferee of all liabilities
associated with the Hillabee Facility, and (c) the Hillabee Transfer and
Indemnity Agreement is in effect at the time of the disposition and the
disposition is consummated in accordance therewith.
"Hillabee Facility" the facility described under "Business--Description of
the Projects--Hillabee" in the Offering Circular.
"Hillabee Transfer and Indemnity Agreement" means the Transfer and
Indemnity Agreement, dated as of the date hereof, by and between Calpine
Corporation and the Company.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a Global Note substantially in the form of Exhibit
A1 hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
principal amount of the Notes sold to Institutional Accredited Investors.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person (excluding accrued expenses and trade payables),
whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of bankers' acceptances;
(4) representing Capital Lease Obligations;
(5) representing the balance deferred and unpaid of the purchase price
of any property or services due more than six months after such property is
acquired or such services are completed; or
(6) representing any Hedging Obligations,
if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any Indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount;
(2) the principal amount of the Indebtedness, in the case of any other
Indebtedness; and
11
(3) in respect of Indebtedness of another Person secured by a Lien on
the assets of the specified Person, the lesser of:
(A) the Fair Market Value of such asset at the date of
determination, and
(B) the amount of the Indebtedness of the other Person.
Notwithstanding anything to the contrary in this definition of
Indebtedness, with respect to any contingent obligations (other than with
respect to contractual obligations to repurchase goods sold or distributed,
which shall be included to the extent reflected on the balance sheet of such
Person in accordance with GAAP) of a Person, the maximum liability of such
Indebtedness shall be as determined by such Person's Board of Directors, in good
faith, as, in light of the facts and circumstances existing at the time,
reasonably likely to be incurred upon the occurrence of the contingency giving
rise to such obligation.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Independent Engineer" means X.X. Xxxx, Inc. or any other independent
engineering company of national standing selected by the Company and reasonably
acceptable to the Term Loan Administrative Agent or, if there is no Term Loan
Administrative Agent, the Trustee.
"Index Based Gas Sale and Power Purchase Agreement" means the Index Based
Gas Sale and Power Purchase Agreement, dated as of the date hereof, by and among
Calpine Energy Services, L.P., the Company and Hermiston Power Partnership.
"Index Hedge" means the ISDA Master Agreement, dated August 7, 2003, by and
between X. Xxxx & Company and the Company.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Initial Notes" means the first $365 million aggregate principal amount of
Notes issued under this Indenture on the date hereof.
"Initial Purchaser" means Xxxxxxx, Xxxxx & Co.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the form
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If the Company
or any Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Subsidiary of the Company such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company will be deemed to have made an Investment
on the date of any such sale or disposition equal to the Fair Market Value of
the Company's Investments in such Subsidiary that were not sold or disposed of
in an amount determined as provided in the final paragraph of the covenant
described under Section 4.07 hereof. Except as otherwise provided in
12
this Indenture, the amount of an Investment will be determined at the time the
Investment is made and without giving effect to subsequent changes in value.
"Issuers" means, collectively, the Company and Finance Corp.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Legal Requirements" means, as to any Person, the articles of
incorporation, bylaws or other organizational or governing documents of such
Person, and any requirement under a Permit, and any Governmental Rule in each
case applicable to or binding upon such Person or any of its properties or to
which such Person or any of its property is subject.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"Major Project Documents" means the Index Based Gas Sale and Power Purchase
Agreement, the Working Capital Facility, the Index Hedge, the Master Operation
and Maintenance Agreement, the Master Maintenance Services Agreement, the
Calpine Performance Guaranty, the Osprey Construction Management Agreement, the
Calpine Project Undertaking, the Hillabee Transfer and Indemnity Agreement, the
Power Purchase and Sale Agreement, dated as of May 22, 1998, between the Company
(as successor in interest) and Magic Valley Electric Cooperative Inc., the
agreements between the Company and GenTex regarding the Lost Pines facility and
the gas transportation agreements between the Company (or any of its
Subsidiaries) and its Affiliates.
"Master Maintenance Services Agreement" dated as of the date hereof, by and
between the Company and Hermiston Power Partnership and Calpine Operating
Services Company, Inc.
"Master Operation and Maintenance Agreement" means the Master Operation and
Maintenance Agreement, dated as of the date hereof, by and between the Company
and Hermiston Power Partnership and Calpine Operating Services Company.
"Material Adverse Effect" means a material adverse effect on (a) the
current or reasonably anticipated business, property, results of operation or
financial condition of the Company and its Subsidiaries taken as a whole, (b)
the ability of the Company and its Subsidiaries to perform their obligations
under the Notes and the Subsidiary Guarantees or (c) the value of, or the
validity or priority of the Collateral Agent's security interests in, the
Collateral taken as a whole.
"Mortgages" means the mortgages or deeds of trust listed on Schedule A
hereto.
"Net Proceeds" means:
(1) the aggregate cash proceeds received by the Company or any of its
Subsidiaries in respect of any Asset Sale (including any cash received upon
the sale or other disposition of any
13
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale, including legal, accounting and investment
banking fees, and sales commissions, and any relocation expenses incurred
as a result of the Asset Sale, taxes paid or payable as a result of the
Asset Sale, in each case, after taking into account any available tax
credits or deductions and any tax sharing arrangements, and amounts
required to be applied to the repayment of Indebtedness, secured by a Lien
on the asset or assets that were the subject of such Asset Sale (other than
Secured Obligations), and any reserve for adjustment in respect of the sale
price of such asset or assets established in accordance with GAAP;
(2) all proceeds of any insurance, indemnity, warranty or guaranty
payable from time to time with respect to any Casualty Event that are not
applied to the repair, replacement or rebuilding of the applicable Facility
to the extent commercially feasible, other than business interruption
insurance proceeds net of direct costs relating to the collection of such
proceeds; and
(3) all payments (in any form whatsoever) made or due and payable from
time to time in connection with any Condemnation Event by any governmental
authority (or any Person acting under color of governmental authority) that
are not applied to the repair, replacement or rebuilding of the applicable
Facility to the extent commercially feasible; net of direct costs relating
to the collection of such proceeds.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Documents" means the Indenture, the Notes, the Subsidiary Guarantees,
the Collateral Trust Agreement, each Sharing Confirmation and the other Security
Documents.
"Note Obligations" means the Notes, the Subsidiary Guarantees and all other
Obligations of any obligor under the Note Documents.
"Notes" has the meaning assigned to it in the preamble to this Indenture.
The Initial Notes and the Additional Notes shall be treated as a single class
for all purposes under this Indenture, and unless the context otherwise
requires, all references to the Notes shall include the Initial Notes and any
Additional Notes.
"Notice of Actionable Default" means a written notice delivered to the
Collateral Agent by any Priority Debt Representative or Parity Debt
Representative in accordance with the applicable Secured Debt Documents, stating
that an Actionable Default has occurred and is continuing.
"Obligations" means any principal, interest, penalties, fees, expenses
(including reasonable fees and expenses of attorneys and other experts),
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Obligor" means the Company, the Parents and any subsidiary of the Company
(other than Finance Corp. that at any time guarantees or provides collateral
security or credit support for any Secured Obligations.
"Offering Circular" means the Offering Circular dated August 7, 2003
relating to the Notes.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary or any Vice-President of such Person.
14
"Officer's Certificate" means a certificate signed on behalf of the Company
by one Officer of the Company that meets the requirements of Section 13.05
hereof.
"Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee, that meets the requirements of Section 13.05 hereof.
The counsel may be an employee of or counsel to the Company, any Subsidiary of
the Company or the Trustee.
"Osprey Construction Management Agreement" means the Construction
Management Agreement, dated as of the date hereof, between Calpine Construction
Management Company, Inc. and CCFC.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"Parents" shall mean Calpine CCFC GP, Inc. and Calpine CCFC LP, Inc., and
their respective successors.
"Parity Debt Representative" means:
(1) in the case of the Notes, the Trustee; or
(2) in the case of any other Series of Parity Lien Debt, the trustee,
agent or representative of the holders of such Series of Parity Lien Debt
who maintains the transfer register for such Series of Parity Lien Debt and
is appointed as a Parity Debt Representative (for purposes related to the
administration of the Security Documents) pursuant to this Indenture or
other agreement governing such Series of Parity Lien Debt.
"Parity Lien" means a Lien granted by a security document to the Collateral
Agent for its benefit and the benefit of the other Secured Parties upon any
property of the Company or any Guarantor to secure Parity Lien Obligations.
"Parity Lien Debt" means:
(1) the Notes;
(2) any Indebtedness under a Credit Facility incurred pursuant to
clause (1) of the second paragraph of Section 4.09 herein;
(3) any Indebtedness in the form of additional notes issued under this
Indenture incurred pursuant to clause (3) of the second paragraph of
Section 4.09 herein; and
(4) any Permitted Refinancing Indebtedness incurred to refund,
refinance or replace the Indebtedness described in clauses (1), (2) and (3)
above pursuant to clause (6) of the second paragraph of Section 4.09
herein,
provided, in the case of each issue or series of Indebtedness referred to
in clauses (2), (3) and (4) above that:
(i) on or before the date on which such Indebtedness was incurred
by the Company or any Subsidiary thereof such Indebtedness is
designated by the Company, in an Officers' Certificate
15
delivered to each Parity Debt Representative and the Collateral Agent
on or before such date, as Parity Lien Debt for the purposes of this
Indenture and the Collateral Trust Agreement,
(ii) such Indebtedness is governed by an indenture or other
agreement that includes a Sharing Confirmation, and
(iii) all requirements set forth in the Collateral Trust
Agreement as to the confirmation, grant or perfection of the
Collateral Agent's Liens to secure such Indebtedness or Obligations in
respect thereof are satisfied (and the satisfaction of such
requirements and the other provisions of clauses (2), (3) and (4)
above shall be conclusively established, for purposes of entitling the
holders of such Indebtedness to share equally and ratably with the
other holders of Parity Lien Debt in the benefits and proceeds of the
Collateral Agent's Liens on the Collateral, if the Company delivers to
the Collateral Agent an Officers' Certificate stating that such
requirements and other provisions have been satisfied and that such
Indebtedness is Parity Lien Debt, together with an Opinion of Counsel
stating that such officers' certificate has been duly authorized by
the Board of Directors of the Company and has been duly executed and
delivered, and the holders of such Indebtedness and Obligations in
respect thereof will be entitled to rely conclusively thereon).
"Parity Lien Debt Documents" means, collectively, the Note Documents and
the indenture or agreement governing each other Series of Parity Lien Debt and
all agreements binding on the Company or any Guarantor related thereto.
"Parity Lien Obligations" means Parity Lien Debt and all other Obligations
in respect thereof.
"Permit" means any action, approval, consent, waiver, exemption, variance,
franchise, order, permit, authorization, right or license of or from a
Governmental Authority.
"Permitted Business" means the ownership, construction, operation and
maintenance of the Closing Date Facilities and any substantially similar
electric generating facilities located in the United States, together with any
related assets or facilities, including gas pipelines supplying natural gas to
such generating facilities, electric transmission lines carrying energy
generated from such generating facilities, and any related gas or electric
interconnection facilities.
"Permitted Investments" means:
(1) any Investment in the Company or in a Wholly Owned Subsidiary of
the Company;
(2) any Investment in Cash Equivalents;
(3) any Investment by the Company or any Subsidiary of the Company in
a Person, if as a result of such Investment:
(a) such Person becomes a Wholly Owned Subsidiary of the Company;
or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or
is liquidated into, the Company or a Wholly Owned Subsidiary of the
Company;
16
(4) any Investment made as a result of the receipt of non-cash
consideration from an Asset Sale that was made pursuant to and in
compliance with the covenant described under Section 4.10 hereof;
(5) any acquisition of assets or Capital Stock solely in exchange for
the issuance of Equity Interests (other than Disqualified Stock) of the
Company;
(6) any Investments received in compromise or resolution of (A)
obligations of trade creditors or customers that were incurred in the
ordinary course of business of the Company or any of its Subsidiaries,
including pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of any trade creditor or customer; or (B)
litigation, arbitration or other disputes with Persons who are not
Affiliates;
(7) Investments represented by Hedging Obligations;
(8) repurchases of the Notes; and
(9) other Investments in any Person other than an Affiliate of the
Company having an aggregate Fair Market Value (measured on the date each
such Investment was made and without giving effect to subsequent changes in
value), when taken together with all other Investments made pursuant to
this clause (9) that are at the time outstanding, not to exceed $7.5
million.
"Permitted Liens" means:
(1) Liens on assets of the Company or any of its Subsidiaries securing
Secured Obligations that were permitted by the terms of this Indenture to
be incurred, and/or securing Hedging Obligations related thereto;
(2) Liens in favor of the Company or the Guarantors;
(3) Pledges or deposits made under workers' compensation, unemployment
insurance laws or similar legislation, or good faith deposits in connection
with bids, tenders, contracts (other than for payment of Indebtedness) or
operating leases to which such Person is a party,
(4) Liens or deposits to secure the performance of statutory
obligations, surety or appeal bonds, performance bonds or other obligations
of a like nature incurred in the ordinary course of business;
(5) Liens to secure Indebtedness (including Capital Lease Obligations)
permitted by clause (3) of the definition of Permitted Debt covering only
the assets acquired with or financed by such Indebtedness; provided that
the Company and its Subsidiaries will not be permitted to grant any such
Liens on any component of a Facility that is necessary for the operation of
such Facility;
(6) Liens which constitute bankers' liens, rights of set-off or
similar rights and remedies as to deposit accounts or other funds
maintained with any bank or other financial institution, whether arising by
operation of law or pursuant to contract;
(7) Liens existing on the date hereof;
17
(8) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded,
provided that any reserve or other appropriate provision as is required in
conformity with GAAP has been made therefor;
(9) Liens imposed by law, such as carriers', warehousemen's,
landlord's and mechanics' Liens, in each case, incurred in the ordinary
course of business; or Liens arising out of judgments that do not
constitute a Default or an Event of Default;
(10) survey exceptions, easements or reservations of, or rights of
others for, licenses, rights-of-way, sewers, electric lines, telegraph and
telephone lines and other similar purposes, or zoning or other restrictions
as to the use of real property or Liens incidental to the conduct of the
business of such Person or to the ownership of its properties that were not
incurred in connection with Indebtedness and that do not in the aggregate
materially adversely affect the value of said properties or materially
impair their use in the operation of the business of such Person;
(11) Liens to secure any Permitted Refinancing Indebtedness permitted
to be incurred under this Indenture; provided, however, that:
(A) the new Lien shall be limited to all or part of the same
property and assets that secured the original Lien (plus repairs,
improvements and additions to such property or assets); and
(B) the Indebtedness secured by the new Lien is not increased to
any amount greater than the sum of (x) the outstanding principal
amount or, if greater, committed amount, of the Permitted Refinancing
Indebtedness and (y) an amount necessary to pay any fees and expenses,
including premiums, related to such Indebtedness;
(12) Liens not in respect of Indebtedness arising from Uniform
Commercial Code financing statements for informational purposes with
respect to operating leases incurred in the ordinary course of business and
not otherwise prohibited by this Indenture;
(13) Liens not in respect of Indebtedness consisting of the interest
of the lessor under any operating lease entered into in the ordinary course
of business and not otherwise prohibited by this Indenture; and
(14) Liens incurred in the ordinary course of business of the Company
or any Subsidiary of the Company with respect to obligations that do not
exceed $10 million at any one time outstanding.
"Permitted Payments to Parent" means, without duplication as to amounts:
(1) payments to Calpine Corporation to permit Calpine Corporation to
pay reasonable accounting, legal and administrative expenses of Calpine
Corporation when due, in an aggregate amount not to exceed $1.0 million per
annum; and
(2) as long as the Company is a pass-through entity for U.S. federal
income tax purposes, payments to Calpine Corporation in an amount equal to
the federal, state, local and foreign taxes (including any penalties and
interest) that the Company would owe if the Company were a corporation for
U.S. federal income tax purposes filing a consolidated or combined return
with its Subsidiaries.
18
"Permitted Refinancing Indebtedness" means any Indebtedness of the Company
or any of its Subsidiaries issued in exchange for, or the net proceeds of which
are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Company or any of its Subsidiaries (other than intercompany
Indebtedness); provided that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness extended, refinanced,
renewed, replaced, defeased or refunded (plus all accrued interest on the
Indebtedness and the amount of all expenses and premiums incurred in
connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of,
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the Notes, such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the
Notes on terms at least as favorable to the Holders of Notes as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by the
Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.
"Pledge Agreement" means the Partnership Interest Pledge Agreement, dated
as of the date hereof, by and among the Parents and the Collateral Agent.
"Pledge and Security Agreement" means the Pledge and Security Agreement,
dated as of the date hereof, by and among the Company, the Guarantors and the
Collateral Agent.
"Priority Debt Representative" means:
(1) in the case of the Term Loans, the Term Loan Administrative Agent;
or
(2) in the case of any other Series of Priority Lien Debt, the
trustee, agent or representative of the holders of such Series of Priority
Lien Debt who maintains the transfer register for such Series of Priority
Lien Debt and is appointed as a Priority Debt Representative (for purposes
related to the administration of the Security Documents) pursuant to this
Indenture or other agreement governing such Series of Priority Lien Debt.
"Priority Lien" means a Lien granted pursuant to a Security Document to the
Collateral Agent for its benefit and the benefit of the other Secured Parties
upon any property of the Company or any Guarantor to secure Priority Lien
Obligations not exceeding the Priority Lien Cap.
"Priority Lien Cap" means an amount equal to (1) the Indebtedness
outstanding under the Term Loan Agreement in an aggregate principal amount not
exceeding $385.0 million, less the amount of any
19
Net Proceeds of an Asset Sale or a Casualty Event or Condemnation Event applied
to repay Priority Lien Debt and/or cash collateralize letters of credit that
constitute Priority Lien Debt, plus (2) any interest (including any interest
accruing at the then applicable rate provided in any applicable Priority Lien
Document after the maturity of the loans and reimbursement obligations therein
and interest accruing at the then applicable rate provided in any applicable
Priority Lien Document after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Company or any Guarantor, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), penalties, premiums,
fees, costs, expenses or other Obligations in respect of such Indebtedness. For
purposes of this definition of Priority Lien Cap, all letters of credit shall be
valued at face amount, whether or not drawn.
"Priority Lien Debt" means Indebtedness under (1) the Term Loan Agreement
or (2) subject to the Priority Lien Cap, any Permitted Refinancing Indebtedness
incurred to refund, refinance or replace the Indebtedness described in clause
(1) pursuant to clause (6) of the second paragraph of Section 4.09 herein, but
only if on or before the day on which such Indebtedness described in this clause
(2) is incurred by the Company such Indebtedness is designated by the Company,
in an Officer's Certificate delivered to each Parity Debt Representative and the
Collateral Agent on or before such date, as Priority Lien Debt for the purposes
of each of the Parity Lien Debt Documents and the Collateral Trust Agreement.
"Priority Lien Documents" means the Term Loan Agreement and all other
agreements governing, securing or relating to any Priority Lien Obligations.
"Priority Lien Obligations" means the Priority Lien Debt and all other
Obligations in respect of Priority Lien Debt.
"Private Placement Legend" means the legend set forth in Section 2.06(g)(1)
to be placed on all Notes issued under this Indenture except where otherwise
permitted by the provisions of this Indenture.
"PUHCA" means the Public Utility Holding Company Act of 1935, as amended.
"Public Equity Offering" means an underwritten primary public offering of
Calpine Corporation's equity securities pursuant to an effective registration
statement under the Securities Act.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Quarterly Period" means any period: (a) beginning on August 27 and ending
on November 26, (b) beginning on November 27 and ending on February 26, (c)
beginning on February 27 and ending on May 26, or (d) beginning on May 27 and
ending on August 26.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note or
Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent Global Note in the
form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
20
"Regulation S Temporary Global Note" means a temporary Global Note in the
form of Exhibit A2 hereto deposited with or on behalf of and registered in the
name of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Notes initially sold in reliance on Rule 903
of Regulation S.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee (or any successor group
of the Trustee) or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Definitive Note" means a Definitive Note bearing the Private
Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private Placement
Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Secured Debt" means Parity Lien Debt and Priority Lien Debt.
"Secured Debt Documents" means the Parity Lien Debt Documents and the
Priority Lien Debt Documents.
"Secured Debt Representatives" means each Parity Lien Representative and
each Priority Lien Representative.
"Secured Obligations" means Parity Lien Obligations and Priority Lien
Obligations, including, without limitation, obligations to the Trustee, the Term
Loan Administrative Agent, any other Priority Debt Representative or Parity Debt
Representative under any Priority Lien Documents or Parity Lien Debt Documents.
"Secured Parties" means the Collateral Agent and the holders of any Secured
Obligations at any time outstanding.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Documents" means the Pledge and Security Agreement, the Pledge
Agreement, the Control Agreement, the Collateral Trust Agreement, the Mortgages
and any other agreement pursuant to which Liens are granted to the Collateral
Agent.
21
"Series of Parity Lien Debt" means, severally, the Notes and each other
issue or series of Parity Lien Debt for which a single transfer register is
maintained.
"Series of Priority Lien Debt" means, severally, the Term Loans and each
other issue or series of Priority Lien Debt for which a single transfer register
is maintained.
"Series of Secured Debt" means, severally, each series of Parity Lien Debt
and each Series of Secured Debt.
"Sharing Confirmation" means, as to any Series of Parity Lien Debt, the
written agreement of the holders of such Series of Parity Lien Debt, as set
forth in this Indenture or agreement governing such Series of Parity Lien Debt,
for the enforceable benefit of all holders of each other existing and future
Series of Parity Lien Debt and each existing and future Parity Debt
Representative, that all Parity Lien Obligations shall be and are secured
equally and ratably by all Liens at any time granted by the Company or any
Guarantor to secure any Obligations in respect of such Series of Parity Lien
Debt, whether or not upon property otherwise constituting Collateral, that all
such Liens shall be enforceable by the Collateral Agent for the benefit of
itself and all holders of Parity Lien Obligations equally and ratably, and that
the holders of Obligations in respect of such Series of Parity Lien Debt are
bound by the provisions in the Collateral Trust Agreement relating to the order
of application of proceeds from enforcement of the Collateral Agent's Liens upon
the Collateral, and consent to and direct the Collateral Agent to enter into and
perform its obligations under the Collateral Trust Agreement.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date
hereof.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness as of the date hereof, and will not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.
"Subordinated Indebtedness" means Indebtedness incurred by the Company
pursuant to any arrangement with an Affiliate of the Company, provided that such
Indebtedness is (1) subordinated in right of payment to the Notes and all other
Secured Obligations and (2) is otherwise in the form set forth in Exhibit G
hereof.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of which
more than 50% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency and after giving
effect to any voting agreement or stockholders' agreement that effectively
transfers voting power) to vote in the election of directors, managers or
trustees of the corporation, association or other business entity is at the
time owned or controlled, directly or indirectly, by that Person or one or
more of the other Subsidiaries of that Person (or a combination thereof) ;
and
(2) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or
(b) the only general partners of which are that Person or one or more
Subsidiaries of that Person (or any combination thereof).
22
"Subsidiary Guarantee" or "Note Guarantee" means the Guarantee by each
Guarantor of the Company's payment obligations under this Indenture and on the
Notes, executed pursuant to the provisions of this Indenture.
"Term Loan Administrative Agent" means Xxxxxxx Xxxxx Credit Partners L.P.,
as administrative agent under the Term Loan Agreement, together with its
successors in such capacity.
"Term Loan Agreement" means that certain Credit and Guaranty Agreement,
dated as of the date hereof, among the Company, the Guarantors and the Term Loan
Administrative Agent, relating to $385.0 million in aggregate principal amount
of Term Loans, including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, as amended,
modified, renewed, restated or replaced, in whole or in part, from time to time.
"Term Loan Documents" means the Term Loan Agreement and the Security
Documents.
"Term Loan Obligations" means the Term Loans (including additional Term
Loans) and all other Obligations under the Term Loan Documents.
"Term Loans" means the principal of and interest and premium (if any) on
Indebtedness of the Company incurred under the Term Loan Agreement.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb)
as in effect on the date on which this Indenture is qualified under the TIA.
"Trustee" means the party named as such in the preamble to this Indenture
until a successor replaces it in accordance with the applicable provisions of
this Indenture and thereafter means the successor serving hereunder.
"Unrestricted Global Note" means a permanent global Note substantially in
the form of Exhibit A1 attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Notes that do not bear the Private
Placement Legend.
"Unrestricted Definitive Note" means one or more Definitive Notes that do
not bear and are not required to bear the Private Placement Legend.
"U.S. Person" means a U.S. Person as defined in Rule 902(o) under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Working Capital Facility" means that certain Working Capital Facility
entered into as of the date hereof between the Company and Calpine CCFC GP, Inc.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of
each then remaining installment, sinking fund, serial maturity or other
required payments of principal, including payment at final maturity, in
respect of the Indebtedness, by (b) the number of years
23
(calculated to the nearest one-twelfth) that will elapse between such date
and the making of such payment; by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Subsidiary" of any specified Person means a Subsidiary of
such Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) will at the time be owned by
such Person or by one or more Wholly-Owned Subsidiaries of such Person and one
or more Wholly-Owned Subsidiaries of such Person.
Section 1.02 Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction"....................................4.11
"Asset Sale Offer".........................................3.09
"Authentication Order".....................................2.02
"Change of Control Offer"..................................4.15
"Change of Control Payment"................................4.15
"Change of Control Payment Date"...........................4.15
"Covenant Defeasance"......................................8.03
"DTC"......................................................2.03
"Event of Default".........................................6.01
"Excess Proceeds"..........................................4.10
"incur"....................................................4.09
"Legal Defeasance".........................................8.02
"Offer Amount".............................................3.09
"Offer Period".............................................3.09
"Paying Agent".............................................2.03
"Permitted Debt"...........................................4.09
"Purchase Date"............................................3.09
"Registrar"................................................2.03
"Restricted Payments"......................................4.07
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Notes;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Subsidiary Guarantees means the Issuers and
the Guarantors, respectively, and any successor obligor upon the Notes and the
Subsidiary Guarantees, respectively.
24
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and transactions; and
(7) references to sections of or rules under the Securities Act will
be deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Notes and the Trustee's certificate of authentication will
be substantially in the form of Exhibit A hereto. The Notes may have notations,
legends or endorsements required by law, stock exchange rule or usage. Each Note
will be dated the date of its authentication. The Notes shall be in
denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes will constitute, and are
hereby expressly made, a part of this Indenture and the Issuers and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Global Notes. Notes issued in global form will be substantially in the
form of Exhibits A1 or A2 attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form will be substantially in the form of
Exhibit A1 attached hereto (but without the Global Note Legend thereon and
without the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Each Global Note will represent such of the outstanding Notes as will
be specified therein and each shall provide that it represents the aggregate
principal amount of outstanding Notes from time to time endorsed thereon and
that the aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and redemptions. Any endorsement of a Global Note to reflect the amount of any
increase or decrease in the aggregate principal amount of outstanding
25
Notes represented thereby will be made by the Trustee or the Custodian, at the
direction of the Trustee, in accordance with instructions given by the Holder
thereof as required by Section 2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S will be issued initially in the form of the Regulation S Temporary
Global Note, which will be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, at its corporate trust office, as
Custodian, and registered in the name of the Depositary or the nominee of the
Depositary for the accounts of designated agents holding on behalf of Euroclear
or Clearstream Bank, duly executed by the Issuers and authenticated by the
Trustee as hereinafter provided. The Restricted Period will be terminated upon
the receipt by the Trustee of a written certificate from the Depositary,
together with copies of certificates from Euroclear and Clearstream Bank,
certifying that they have received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any beneficial owners thereof who
acquired an interest therein during the Restricted Period pursuant to another
exemption from registration under the Securities Act and who will take delivery
of a beneficial ownership interest in a 144A Global Note or an IAI Global Note
bearing a Private Placement Legend, all as contemplated by Section 2.06(b)
hereof); and an Officer's Certificate from the Company stating that such
Restricted Period has ended.
(d) Following the termination of the Restricted Period, beneficial
interests in the Regulation S Temporary Global Note will be exchanged for
beneficial interests in Regulation S Permanent Global Notes pursuant to the
Applicable Procedures. Simultaneously with the authentication of Regulation S
Permanent Global Notes, the Trustee will, upon receipt of written directions,
cancel the Regulation S Temporary Global Note. The aggregate principal amount of
the Regulation S Temporary Global Note and the Regulation S Permanent Global
Notes may from time to time be increased or decreased by adjustments made on the
records of the Trustee and the Depositary or its nominee, as the case may be, in
connection with transfers of interest as hereinafter provided.
(1) Euroclear and Clearstream Procedures Applicable. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and
Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Clearstream Banking" and "Customer Handbook" of Clearstream
will be applicable to transfers of beneficial interests in the Regulation S
Temporary Global Note and the Regulation S Permanent Global Notes that are
held by Participants through Euroclear or Clearsteam.
Section 2.02 Execution and Authentication.
One Officer of each Issuer must sign the Notes for the Issuers by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that office at
the time a Note is authenticated, the Note will nevertheless be valid.
A Note will not be valid until authenticated by the manual signature of the
Trustee. The signature will be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee will, upon receipt of a written order of the Issuers signed by
one Officer of each Issuer (an "Authentication Order"), authenticate Notes for
original issue up to the aggregate principal amount stated in paragraph 4 of the
Notes. The aggregate principal amount of Notes outstanding at any time may not
exceed such amount except as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the Issuers
to authenticate Notes. An authenticating agent may authenticate Notes whenever
the Trustee may do so. Each reference in this
26
Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent to deal with
Holders or an Affiliate of the Issuers.
Section 2.03 Registrar and Paying Agent.
The Company, on behalf of itself and Finance Corp., will maintain an office
or agency where Notes may be presented for registration of transfer or for
exchange ("Registrar") and an office or agency where Notes may be presented for
payment ("Paying Agent"). The Registrar will keep a register of the Notes and of
their transfer and exchange. The Issuers may appoint one or more co-registrars
and one or more additional paying agents. The term "Registrar" includes any
co-registrar and the term "Paying Agent" includes any additional paying agent.
The Issuers may change any Paying Agent or Registrar without notice to any
Holder. The Company will notify the Trustee in writing of the name and address
of any Agent not a party to this Indenture. If the Issuers fail to appoint or
maintain another entity as Registrar or Paying Agent, the Trustee shall act as
such. The Company or any of its Subsidiaries may act as Paying Agent or
Registrar.
The Issuers initially appoint The Depository Trust Company ("DTC") to act
as Depositary with respect to the Global Notes.
The Issuers initially appoint the Trustee to act as the Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Issuers will require each Paying Agent other than the Trustee to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of principal,
premium, if any, or interest on the Notes, and will notify the Trustee of any
default by the Issuers in making any such payment. While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it to
the Trustee. The Company at any time may require a Paying Agent to pay all money
held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent
(if other than the Company or a Subsidiary) will have no further liability for
the money. If the Company or a Subsidiary acts as Paying Agent, it will
segregate and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent. Upon any bankruptcy or reorganization
proceedings relating to the Company, the Trustee will serve as Paying Agent for
the Notes.
Section 2.05 Holder Lists.
The Trustee will preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of all Holders
and shall otherwise comply with TIA ss. 312(a). If the Trustee is not the
Registrar, the Company will furnish to the Trustee at least seven Business Days
before each interest payment date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders and the Company
shall otherwise comply with TIA ss. 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Issuers for Definitive Notes if:
27
(1) the Issuers deliver to the Trustee written notice from the
Depositary that it is unwilling or unable to continue to act as Depositary
or that it is no longer a clearing agency registered under the Exchange Act
and, in either case, a successor Depositary is not appointed by the Issuers
within 120 days after the date of such notice from the Depositary;
(2) the Issuers in their sole discretion determine that the Global
Notes (in whole but not in part) should be exchanged for Definitive Notes
and deliver a written notice to such effect to the Trustee; provided that
in no event shall the Regulation S Temporary Global Note be exchanged by
the Issuers for Definitive Notes prior to (x) the expiration of the
Restricted Period and (y) the receipt by the Registrar of any certificates
required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act; or
(3) there has occurred and is continuing a Default or Event of Default
with respect to the Notes.
Upon the occurrence of any of the preceding events in (1), (2) or (3)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee in writing. Global Notes also may be exchanged or replaced,
in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or any
portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof,
shall be authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as provided
in this Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes. The
transfer and exchange of beneficial interests in the Global Notes will be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
Global Notes will be subject to restrictions on transfer comparable to those set
forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also will require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Restricted Period, transfers of
beneficial interests in the Regulation S Temporary Global Note may not be
made to a U.S. Person or for the account or benefit of a U.S. Person (other
than an Initial Purchaser). Beneficial interests in any Unrestricted Global
Note may be transferred to Persons who take delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(1) above, the transferor
of such beneficial interest must deliver to the Registrar either:
(A) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the
28
Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged; and
(ii) instructions given in accordance with the Applicable
Procedures containing information regarding the Participant
account to be credited with such increase; or
(B) both:
(i) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged; and
(ii) instructions given by the Depositary to the Registrar
containing information regarding the Person in whose name such
Definitive Note shall be registered to effect the transfer or
exchange referred to in (1) above; provided that in no event
shall Definitive Notes be issued upon the transfer or exchange of
beneficial interests in the Regulation S Temporary Global Note
prior to (A) the expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required pursuant to
Rule 903 under the Securities Act.
(3) Transfer of Beneficial Interests to Another Restricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Temporary Global Note or the
Regulation S Global Note, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3) thereof, if applicable.
(4) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in an Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(2) above and:
(A) the Registrar receives the following:
29
(i) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
(ii) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (A), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (A) above at a
time when an Unrestricted Global Note has not yet been issued, the Company shall
issue and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global
Notes in an aggregate principal amount equal to the aggregate principal amount
of beneficial interests transferred pursuant to subparagraph (A) above.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive Notes.
(1) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the form
of Exhibit C hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such beneficial interest is being transferred pursuant to
an exemption from the registration requirements of the Securities Act
in accordance with Rule 144, a
30
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof; or
(G) if such beneficial interest is being transferred pursuant to
an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Issuers shall execute and the Trustee shall authenticate upon
receipt of an Authentication Order and deliver to the Person designated in
such order a Definitive Note in the appropriate principal amount. Any
Definitive Note issued in exchange for a beneficial interest in a
Restricted Global Note pursuant to this Section 2.06(c) shall be registered
in such name or names and in such authorized denomination or denominations
as the holder of such beneficial interest shall instruct the Registrar
through instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the Persons
in whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest in a Restricted Global Note pursuant to
this Section 2.06(c)(1) shall bear the Private Placement Legend and shall
be subject to all restrictions on transfer contained therein.
(2) Beneficial Interests in Regulation S Temporary Global Note to
Definitive Notes. Notwithstanding Sections 2.06(c)(1)(A) and (C) hereof, a
beneficial interest in the Regulation S Temporary Global Note may not be
exchanged for a Definitive Note or transferred to a Person who takes
delivery thereof in the form of a Definitive Note prior to (A) the
expiration of the Restricted Period and (B) the receipt by the Registrar of
any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the
Securities Act, except in the case of a transfer pursuant to an exemption
from the registration requirements of the Securities Act other than Rule
903 or Rule 904.
(3) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) the Registrar receives the following:
(i) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
31
(ii) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (A), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
(4) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a Definitive
Note or to transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.06(b)(2) hereof, the Trustee will cause
the aggregate principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company will
execute and the Trustee will authenticate and deliver to the Person
designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(3) will be registered in such
name or names and in such authorized denomination or denominations as the
holder of such beneficial interest requests through instructions to the
Registrar from or through the Depositary and the Participant or Indirect
Participant. The Trustee will deliver such Definitive Notes to the Persons
in whose names such Notes are so registered. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(3) will
not bear the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial Interests.
(1) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note or
to transfer such Restricted Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in a Restricted Global Note,
then, upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to a
QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such Restricted Definitive Note is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with
32
Rule 144, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee will cancel the Restricted Definitive Note, increase or cause
to be increased the aggregate principal amount of, in the case of clause
(A) above, the appropriate Restricted Global Note, in the case of clause
(B) above, the 144A Global Note, in the case of clause (C) above, the
Regulation S Global Note, and in all other cases, the IAI Global Note.
(2) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global Note
only if:
(A) the Registrar receives the following:
(i) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(c)
thereof; or
(ii) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof
in the form of a beneficial interest in the Unrestricted Global
Note, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (A), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required in order to
maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(2), the Trustee will cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
33
(3) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global Note
or transfer such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note at any
time. Upon receipt of a request for such an exchange or transfer, the
Trustee will cancel the applicable Unrestricted Definitive Note and
increase or cause to be increased the aggregate principal amount of one of
the Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B), (2)(D) or
(3) above at a time when an Unrestricted Global Note has not yet been
issued, the Company will issue and, upon receipt of an Authentication Order
in accordance with Section 2.02 hereof, the Trustee will authenticate one
or more Unrestricted Global Notes in an aggregate principal amount equal to
the principal amount of Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes. Upon
request by a Holder of Definitive Notes and such Holder's compliance with the
provisions of this Section 2.06(e), the Registrar will register the transfer or
exchange of Definitive Notes. Prior to such registration of transfer or
exchange, the requesting Holder must present or surrender to the Registrar the
Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
must provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(1) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the name
of Persons who take delivery thereof in the form of a Restricted Definitive
Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A under the
Securities Act, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transfer will be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer will be made pursuant to any other exemption
from the registration requirements of the Securities Act, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(2) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who take
delivery thereof in the form of an Unrestricted Definitive Note if:
(A) the Registrar receives the following:
(i) if the Holder of such Restricted Definitive Notes
proposes to exchange such Notes for an Unrestricted Definitive
Note, a certificate from such
34
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(ii) if the Holder of such Restricted Definitive Notes
proposes to transfer such Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note,
a certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (A), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(3) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a Person
who takes delivery thereof in the form of an Unrestricted Definitive Note.
Upon receipt of a request to register such a transfer, the Registrar shall
register the Unrestricted Definitive Notes pursuant to the instructions
from the Holder thereof.
(f) Legends. The following legends will appear on the face of all Global
Notes and Definitive Notes issued under this Indenture unless specifically
stated otherwise in the applicable provisions of this Indenture.
(A) Private Placement Legend. Except as permitted by subparagraph
(B) below, each Global Note and each Definitive Note (and all Notes
issued in exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY THE INITIAL
INVESTOR, (1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), AND (B) BY
SUBSEQUENT INVESTORS, AS SET FORTH IN (A) ABOVE, AND, IN ADDITION, TO AN
INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501 OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND, IN THE CASE OF EACH OF CLAUSES (A)
AND (B), IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS."
(B) Notwithstanding the foregoing, any Global Note or Definitive
Note issued pursuant to subparagraphs (b)(4), (c)(3), (c)(4), (d)(2),
(d)(3), (e)(2) or (e)(3) of this Section 2.06 (and all Notes issued in
exchange therefor or substitution thereof) will not bear the Private
Placement Legend.
35
(2) Global Note Legend. Each Global Note will bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY AND FINANCE
CORP.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
(3) Regulation S Temporary Global Note Legend. The Regulation S
Temporary Global Note will bear a legend in substantially the
following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON."
(g) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to or
retained and canceled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note will be
reduced accordingly and an endorsement will be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note will be increased accordingly and
an endorsement will be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
36
(h) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the Issuers
will execute and the Trustee will authenticate Global Notes and Definitive
Notes upon receipt of an Authentication Order in accordance with Section
2.02 or at the Registrar's request.
(2) No service charge will be made to a Holder of a Global Note or to
a Holder of a Definitive Note for any registration of transfer or exchange,
but the Issuers may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable
upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10, 4.15
and 9.05 hereof).
(3) The Registrar will not be required to register the transfer of or
exchange any Note selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
(4) All Global Notes and Definitive Notes issued upon any registration
of transfer or exchange of Global Notes or Definitive Notes will be the
valid obligations of the Issuers, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Global Notes or Definitive
Notes surrendered upon such registration of transfer or exchange.
(5) The Issuers will not be required:
(A) to issue, to register the transfer of or to exchange any
Notes during a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption under Section
3.02 hereof and ending at the close of business on the day of
selection;
(B) to register the transfer of or to exchange any Note selected
for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part; or
(C) to register the transfer of or to exchange a Note between a
record date and the next succeeding interest payment date.
(6) Prior to due presentment for the registration of a transfer of any
Note, the Trustee, any Agent and the Issuers may deem and treat the Person
in whose name any Note is registered as the absolute owner of such Note for
the purpose of receiving payment of principal of and interest on such Notes
and for all other purposes, and none of the Trustee, any Agent, the Company
or Finance Corp. shall be affected by notice to the contrary.
(7) The Trustee will authenticate Global Notes and Definitive Notes in
accordance with the provisions of Section 2.02 hereof.
(8) All certifications, certificates and Opinions of Counsel required
to be submitted to the Registrar pursuant to this Section 2.06 to effect a
registration of transfer or exchange may be submitted by facsimile.
37
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Issuers and the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, the Issuers will issue and the Trustee, upon receipt of an
Authentication Order, will authenticate a replacement Note if the Trustee's
requirements hereunder are met. If required by the Trustee or either Issuer, an
indemnity bond must be supplied by the Holder that is sufficient in the judgment
of the Trustee and the Issuers to protect the Issuers, the Trustee, any Agent
and any authenticating agent from any loss that any of them may suffer if a Note
is replaced. The Issuers may charge the applicable Holder for their expenses in
replacing a Note.
Every replacement Note is an additional obligation of the Issuers and will
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section as
not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Company or an Affiliate of the Company holds
the Note.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a protected purchaser.
If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an Affiliate
of any thereof) holds, on a redemption date or maturity date, money sufficient
to pay Notes payable on that date, then on and after that date such Notes will
be deemed to be no longer outstanding and will cease to accrue interest.
Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, will be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee will be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned will be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the Issuers
may prepare and the Trustee, upon receipt of an Authentication Order, will
authenticate temporary Notes. Temporary Notes will be substantially in the form
of certificated Notes but may have variations that the Issuers consider
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee. Without unreasonable delay, the Issuers will prepare and the Trustee
will authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes will be entitled to all of the benefits of this
Indenture.
38
Section 2.11 Cancellation.
The Issuers at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent will forward to the Trustee any Notes surrendered
to them for registration of transfer, exchange or payment. Upon receipt of
written directions, the Trustee and no one else will cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and will destroy canceled Notes (subject to the record retention
requirement of the Exchange Act). Certification of the destruction of all
canceled Notes will be delivered to the Issuers. The Issuers may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it will pay
the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company will notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company will fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
may be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) will mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.
ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Issuers elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, the Company must furnish to the Trustee, at
least 30 days but not more than 60 days before a redemption date, an Officers'
Certificate setting forth:
(1) the clause of this Indenture pursuant to which the redemption
shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
If less than all of the Notes are to be redeemed or purchased in an offer
to purchase at any time, the Trustee will select Notes for redemption or
purchase as follows:
(1) if the Notes are listed on any national securities exchange, in
compliance with the requirements of the principal national securities
exchange on which the Notes are listed; or
(2) if the Notes are not listed on any national securities exchange,
on a pro rata basis, by lot or by such method as the Trustee shall deem
fair and appropriate.
39
In the event of partial redemption or purchase by lot, the particular Notes
to be redeemed or purchased will be selected, unless otherwise provided herein,
not less than 30 nor more than 60 days prior to the redemption or purchase date
by the Trustee from the outstanding Notes not previously called for redemption
or purchase.
The Trustee will promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected will be in amounts of $1,000 or
whole multiples of $1,000; except that if all of the Notes of a Holder are to be
redeemed or purchased, the entire outstanding amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be redeemed or purchased. Except
as provided in the preceding sentence, provisions of this Indenture that apply
to Notes called for redemption or purchase also apply to portions of Notes
called for redemption or purchase.
Section 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days but not
more than 60 days before a redemption date, the Company will mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Notes
are to be redeemed at its registered address, except that redemption notices may
be mailed more than 60 days prior to a redemption date if the notice is issued
in connection with a defeasance of the Notes or a satisfaction and discharge of
this Indenture pursuant to Articles 8 or 12 of this Indenture.
The notice will identify the Notes to be redeemed and will state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption
date upon surrender of such Note, a new Note or Notes in principal amount
equal to the unredeemed portion will be issued upon cancellation of the
original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(6) that, unless the Issuers default in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the redemption date;
(7) the paragraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee will give the notice of redemption in
the Company's name and at its expense; provided, however, that the Company has
delivered to the Trustee, at least 45 days
40
prior to the redemption date, an Officers' Certificate requesting that the
Trustee give such notice and setting forth the information to be stated in such
notice as provided in the preceding paragraph.
Section 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price. A notice of redemption may not be conditional.
Section 3.05 Deposit of Redemption or Purchase Price.
Not less than one Business Day prior to the redemption or purchase price
date, the Issuers will deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption or purchase price of and accrued interest on
all Notes to be redeemed or purchased on that date. The Trustee or the Paying
Agent will promptly return to the Issuers any money deposited with the Trustee
or the Paying Agent by the Issuers in excess of the amounts necessary to pay the
redemption or purchase price of, and accrued interest on, all Notes to be
redeemed or purchased.
If the Issuers comply with the provisions of the preceding paragraph, on
and after the redemption or purchase date, interest will cease to accrue on the
Notes or the portions of Notes called for redemption or purchase. If a Note is
redeemed or purchased on or after an interest record date but on or prior to the
related interest payment date, then any accrued and unpaid interest shall be
paid. If any Note called for redemption or purchase is not so paid upon
surrender for redemption or purchase because of the failure of the Issuers to
comply with the preceding paragraph, interest shall be paid on the unpaid
principal, from the redemption or purchase date until such principal is paid,
and to the extent lawful on any interest not paid on such unpaid principal, in
each case at the rate provided in the Notes and in Section 4.01 hereof.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the Issuers
will issue and, upon receipt of an Authentication Order, the Trustee will
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) The Issuers may redeem all or a part of the Notes at any time prior to
August 26, 2009, upon not less than 30 nor more than 60 days prior notice, at a
redemption price equal to 100% of the principal amount of the Notes redeemed
plus the Applicable Premium as of, and accrued and unpaid interest, if any, to,
the redemption date, subject to the rights of Holders on the relevant record
date to receive interest due on the relevant interest payment date.
(b) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Issuers' option prior to August 26, 2009.
(c) On or after August 26, 2009, the Issuers may redeem all or a part of
the Notes upon not less than 30 nor more than 60 days' notice, at the redemption
prices (expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest thereon, to the applicable redemption date, if
redeemed during the twelve-month period beginning on August 26 of the years
indicated below, subject to the rights of Holders on the relevant record date to
receive interest on the relevant interest payment date:
41
Year Percentage
---- ----------
2009............................................... 104.250%
2010 to February 25, 2011.......................... 102.125%
February 26, 2011 and thereafter................... 100.000%
(d) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Section 3.01 through 3.06 hereof. Unless the Issuers default
in the payment of the redemption price, interest will cease to accrue on the
Notes or portions thereof called for redemption on the applicable redemption
date.
Section 3.08 Mandatory Redemption.
The Issuers are not required to make mandatory redemption or sinking fund
payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Net Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company is required
to commence an offer to all Holders to purchase Notes (an "Asset Sale Offer"),
it will follow the procedures specified below.
The Asset Sale Offer shall be made to all Holders and all holders of other
Parity Lien Obligations containing provisions similar to those set forth in this
Indenture with respect to offers to purchase, repay or redeem with the proceeds
of sales of assets. The Asset Sale Offer will remain open for a period of at
least 20 Business Days following its commencement and not more than 30 Business
Days, except to the extent that a longer period is required by applicable law
(the "Offer Period"). No later than three Business Days after the termination of
the Offer Period (the "Purchase Date"), the Company will apply all Net Proceeds
(the "Offer Amount") to the purchase of Notes and such other Parity Lien
Obligations (on a pro rata basis, if applicable) or, if less than the Offer
Amount has been tendered, all Notes and other Parity Lien Obligations tendered
in response to the Asset Sale Offer. Payment for any Notes so purchased will be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest will
be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest will be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company will send, by
first class mail, a notice to the Trustee and each of the Holders, with a copy
to the Trustee. The notice will contain all instructions and materials necessary
to enable such Holders to tender Notes pursuant to the Asset Sale Offer. The
notice, which will govern the terms of the Asset Sale Offer, will state:
(1) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.10 hereof and the length of time the Asset Sale Offer
will remain open;
(2) the Offer Amount, the purchase price and the Purchase Date;
(3) that any Note not tendered or accepted for payment will continue
to accrue interest;
42
(4) that, unless the Company defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer will cease to accrue
interest after the Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to an
Asset Sale Offer may elect to have Notes purchased in integral multiples of
$1,000 only;
(6) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer will be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Company, a
Depositary, if appointed by the Company, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(7) that Holders will be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives,
not later than the expiration of the Offer Period, a telegram, telex,
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Note the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to have such Note
purchased;
(8) that, if the aggregate principal amount of Notes and other Parity
Lien Obligations surrendered by Holders exceeds the Offer Amount, the
Company will select the Notes and other Parity Lien Obligations to be
purchased on a pro rata basis based on the principal amount of Notes and
such other Parity Lien Obligations surrendered (with such adjustments as
may be deemed appropriate by the Company so that only Notes in
denominations of $1,000, or integral multiples thereof, will be purchased);
and
(9) that Holders whose Notes were purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Company will, to the extent lawful,
accept for payment, on a pro rata basis to the extent necessary, the Offer
Amount of Notes or portions thereof tendered pursuant to the Asset Sale Offer,
or if less than the Offer Amount has been tendered, all Notes tendered, and will
deliver to the Trustee an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 3.09. The Company, the Depositary or the Paying Agent, as
the case may be, will promptly (but in any case not later than five days after
the Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Company for purchase, and the Company will promptly issue a new Note, and the
Trustee, upon written request from the Company will authenticate and mail or
deliver such new Note to such Holder, in a principal amount equal to any
unpurchased portion of the Note surrendered. Any Note not so accepted shall be
promptly mailed or delivered by the Company to the Holder thereof. The Company
will publicly announce the results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any purchase
pursuant to this Section 3.09 shall be made pursuant to the provisions of
Sections 3.01 through 3.06 hereof.
43
ARTICLE 4.
COVENANTS
Section 4.01 Payment of Notes.
The Company will pay or cause to be paid the principal of, premium, if any,
and interest on the Notes on the dates and in the manner provided in the Notes.
Principal, premium, if any, and interest will be considered paid on the date due
if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as
of 10:00 a.m. Eastern Time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, and interest then due.
The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal at the rate equal to
1% per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02 Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company 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
fails to maintain any such required office or agency or fails to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission will 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 designates the Corporate Trust Office of the Trustee as
one such office or agency of the Company in accordance with Section 2.03 hereof.
Section 4.03 Reports.
Whether or not required by the SEC's rules and regulations, so long as any
Notes are outstanding, the Company will furnish to the Holders, within the time
periods specified in the SEC's rules and regulations:
(1) all quarterly and annual reports that would be required to be
filed with the SEC on Forms 10-Q and 10-K if the Company were required to
file such reports (provided that the quarterly report that would otherwise
be required to be provided on August 15, 2003 shall be required to be
provided on or prior to September 1, 2003) ; and
44
(2) all current reports that would be required to be filed with the
SEC on Form 8-K if the Company were required to file such reports.
All such reports will be prepared in all material respects in accordance with
all of the rules and regulations applicable to such reports and presented in a
manner consistent with the financial statements included in the Offering
Circular. Each annual report on Form 10-K will include a report on the Company's
consolidated financial statements by the Company's certified independent
accountants.
The Company will also cause the Independent Engineer to deliver to the
Trustee (and the Trustee will make available to the Holders ) annual reports on,
or within 10 days after, January 15 of each year regarding the construction,
operation and maintenance of the Facilities. Such reports will be in form and
substance as reasonably determined by the Company as are customary for capital
markets project financings and will include discussion of, among other things,
capital expenditures, planned and unplanned maintenance, permit compliance and
progress of construction (if applicable). The Company will, and will cause its
Subsidiaries to, provide the Independent Engineer access to the Facilities as
necessary for the preparation of such reports.
Section 4.04 Compliance Certificate.
(a) The Issuers and each Guarantor (to the extent that such Guarantor is so
required under the TIA) shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default has occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action the Company is taking or
proposes to take with respect thereto) and that to the best of his or her
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.03(1) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article 4 or Article 5 hereof or, if any such violation has
occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) So long as any of the Notes are outstanding, the Company will deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default, an Officers' Certificate specifying such Default or Event of
Default and what action the Company is taking or proposes to take with respect
thereto.
45
Section 4.05 Taxes.
The Company will pay, and will cause each of its Subsidiaries to pay, prior
to delinquency, all material taxes, assessments, and governmental levies except
such as are contested in good faith and by appropriate proceedings or where the
failure to effect such payment is not adverse in any material respect to the
Holders of the Notes.
Section 4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension
or usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company and
each of the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law has been enacted.
Section 4.07 Restricted Payments.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of the Company's Equity Interests (including any
payment in connection with any merger or consolidation involving the
Company) or to the direct or indirect holders of the Company's Equity
Interests in their capacity as such, including payments of the type
described in clause (2) of the definition of "Permitted Payments to Parent"
under Section 1.01 herein (other than dividends or distributions payable to
the Company or a Subsidiary of the Company);
(2) purchase, redeem or otherwise acquire or retire for value
(including in connection with any merger or consolidation involving the
Company) any Equity Interests of the Company;
(3) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Subordinated
Indebtedness or any other Indebtedness of the Company or any of its
Subsidiaries that is contractually subordinated to the Notes or any
Subsidiary Guarantee, including any payments under the Working Capital
Facility (excluding any intercompany Indebtedness between or among the
Company and any of its Subsidiaries); or
(4) make any Restricted Investment;
(all such payments and other actions set forth in these clauses (1) through (4)
above being collectively referred to as "Restricted Payments"), unless (A) such
Restricted Payment is made following the end of a Quarterly Period from Excess
Cash Flow generated during such Quarterly Period or during previous Quarterly
Periods (but only if Excess Cash Flow from the date hereof through the end of
such Quarterly Period is positive) and (B) no Default or Event of Default has
occurred and is continuing or would occur as a consequence of such Restricted
Payment (other than any Default or Event of Default that is cured as a result of
such Restricted Payment). The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, make any Restricted Payment other than
payment of amounts due under the Working Capital Facility unless, at the time of
making such Restricted Payment, all amounts then due under the Working Capital
Facility have been paid in full.
46
Section 4.08 Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Subsidiary of the
Company to:
(1) pay dividends or make any other distributions on its Capital Stock
to the Company or any of its Subsidiaries, or with respect to any other
interest or participation in, or measured by, its profits, or pay any
indebtedness owed to the Company or any of its Subsidiaries;
(2) make loans or advances to the Company or any of its Subsidiaries;
or
(3) transfer any of its properties or assets to the Company or any of
its Subsidiaries.
However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:
(1) the Indenture, the Notes, the Term Loan Agreement and the
Subsidiary Guarantees;
(2) applicable law, rule, regulation or order;
(3) customary non-assignment provisions in contracts, agreements,
leases, permits or licenses entered into or issued in the ordinary course
of business and consistent with past practices;
(4) purchase money obligations for property acquired in the ordinary
course of business and Capital Lease Obligations that impose restrictions
on the property purchased or leased of the nature described in clauses (1)
and (3) of the preceding paragraph;
(5) any agreement for the sale or other disposition of a Subsidiary
that restricts distributions by that Subsidiary pending the sale or other
disposition;
(6) Permitted Refinancing Indebtedness; provided that the restrictions
contained in the agreements governing such Permitted Refinancing
Indebtedness are not materially more restrictive, taken as a whole, than
those contained in the agreements governing the Indebtedness being
refinanced;
(7) Liens securing Indebtedness otherwise permitted to be incurred
under the provisions of the covenant described under Section 4.12 hereof
that limit the right of the debtor to dispose of the assets subject to such
Liens or to use the proceeds of any such disposition;
(8) provisions limiting or prohibiting the disposition or distribution
of assets or property in joint venture agreements, asset sale agreements,
sale-leaseback agreements, stock sale agreements and other similar
agreements entered into with the approval of the Company's Board of
Directors, which limitation or prohibition is applicable only to the assets
that are the subject of such agreements; and
(9) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business.
47
Section 4.09 Incurrence of Indebtedness and Issuance of Preferred Equity.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt), and the
Company will not issue any Disqualified Stock and will not permit any of its
Subsidiaries to issue any shares of preferred equity.
The preceding paragraph will not prohibit the incurrence of any of the
following items of Indebtedness (collectively, "Permitted Debt"):
(1) the incurrence by the Company (and the guarantee by its
Subsidiaries) of revolving credit Indebtedness and letters of credit under
Credit Facilities with Persons that are not Affiliates of the Company in an
aggregate principal amount at any one time outstanding under this clause
(1) (with letters of credit being deemed to have a principal amount equal
to the maximum potential liability of the Company thereunder), including
all Permitted Refinancing Indebtedness incurred to refund, refinance or
replace any Indebtedness incurred pursuant to this clause (1), not to
exceed $50.0 million less the aggregate principal amount of Indebtedness
incurred pursuant to clause (3) of this paragraph;
(2) the incurrence by the Issuers and the Guarantors of Indebtedness
represented by the Notes, the related Subsidiary Guarantees and the other
Note Obligations to be issued on the date hereof;
(3) the incurrence by the Issuers and the Guarantors of Indebtedness
represented by Additional Notes (and the related Subsidiary Guarantees)
issued under this Indenture after the date thereof, in an aggregate
principal amount at any one time outstanding under this clause (3),
including all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any Indebtedness incurred pursuant to this clause (3),
not to exceed $50.0 million less the aggregate principal amount of
Indebtedness incurred pursuant to clause (1) of this paragraph;
(4) the incurrence by the Company and the Guarantors of Indebtedness
represented by the Term Loans, the related Subsidiary Guarantees and the
other Term Loan Obligations on the first date of issuance of the Notes in
an aggregate principal amount not to exceed $385.0 million;
(5) the incurrence by the Company or any of its Subsidiaries of
Indebtedness represented by Capital Lease Obligations or purchase money
obligations, in each case, incurred for the purpose of financing all or any
part of the costs associated with the construction, installation,
operation, maintenance or improvement of any of the Facilities, in an
aggregate principal amount, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause (5), not to exceed $50.0 million at any
time outstanding;
(6) the incurrence by the Company or any of its Subsidiaries of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to refund, refinance or replace, Indebtedness (other than
intercompany Indebtedness) that was permitted by this Indenture to be
incurred under clauses (1), (2), (3), (4), (5) or (6) of this paragraph;
(7) the incurrence by the Company or any of its Subsidiaries of
intercompany Indebtedness between or among the Company and any of its
Subsidiaries; provided, however, that (i) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness
48
being held by a Person other than the Company or a Subsidiary of the
Company and (ii) any sale or other transfer of any such Indebtedness to a
Person that is not either the Company or a Subsidiary of the Company will
be deemed, in each case, to constitute an incurrence of such Indebtedness
by the Company or such Subsidiary, as the case may be, that was not
permitted by this clause (7); and provided, further, that any such
intercompany Indebtedness must be included in the Collateral;
(8) the incurrence by the Company or any of its Subsidiaries of
Hedging Obligations, in connection with Permitted Debt or otherwise, in the
ordinary course of business and not for speculative purposes;
(9) the incurrence by the Company or any of its Subsidiaries of
Indebtedness in respect of workers' compensation claims, self-insurance
obligations, bankers' acceptances, and performance and surety bonds in the
ordinary course of business;
(10) the incurrence by the Company or any of its Subsidiaries of
Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument inadvertently drawn
against insufficient funds, so long as such Indebtedness is covered within
five business days; and
(11) the incurrence by the Company or any of its Subsidiaries of (a)
Subordinated Indebtedness under the Working Capital Facility and (b) other
Subordinated Indebtedness loaned to the Company or any of its Subsidiaries
by an Affiliate of the Company outstanding on the closing date (and any
accrued interest thereon).
The Company will not incur, and will not permit any Subsidiary to incur,
any Indebtedness (including Permitted Debt) that is contractually subordinated
in right of payment to any other Indebtedness of the Company or such Subsidiary
unless such Indebtedness is also contractually subordinated in right of payment
to the Notes and the applicable Subsidiary Guarantee on substantially identical
terms or on terms that are more favorable to the Holders; provided, however,
that no Indebtedness will be deemed to be contractually subordinated in right of
payment to any other Indebtedness of the Company or any of its Subsidiaries
solely by virtue of being unsecured or by virtue of being secured on a junior
basis.
For purposes of determining compliance with this "Incurrence of
Indebtedness and Issuance of Preferred Equity" covenant, in the event that an
item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (1) through (11) above, the
Company will be permitted to classify such item of Indebtedness on the date of
its incurrence, or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this covenant. The accrual of
interest, the accretion or amortization of original issue discount, the payment
of interest on any Indebtedness in the form of additional Indebtedness with the
same terms, and the payment of dividends on Disqualified Stock in the form of
additional shares of the same class of Disqualified Stock will not be deemed to
be an incurrence of Indebtedness or an issuance of Disqualified Stock for
purposes of this covenant; provided, in each such case, that the amount thereof
is included in Fixed Charges of the Company as accrued. Notwithstanding any
other provision of this covenant, the maximum amount of Indebtedness that the
Company or any Subsidiary may incur pursuant to this covenant shall not be
deemed to be exceeded solely as a result of fluctuations in exchange rates or
currency values.
49
Section 4.10 Asset Sales.
The Company will not, and will not permit any of its Subsidiaries to,
consummate any Asset Sale (other than a Designated Asset Disposition) unless:
(1) the Company (or any of its Subsidiaries, as the case may be)
receives consideration at the time of the Asset Sale at least equal to the
Fair Market Value of the assets or Equity Interests issued or sold or
otherwise disposed of (as determined by the Company's Board of Directors
and evidenced by a resolution delivered to the Trustee);
(2) at least 90% of the consideration therefor received in the Asset
Sale by the Company or such Subsidiary is in the form of cash. For purposes
of this provision, each of the following will be deemed to be cash:
(A) any liabilities, as shown on the Company's most recent
consolidated balance sheet, of the Company or any Subsidiary (other
than contingent liabilities and liabilities that are by their terms
subordinated to the Notes or any Subsidiary Guarantee) that are
assumed by the transferee of any such assets pursuant to a customary
novation or similar agreement that releases the Company or such
Subsidiary from further liability; and
(B) any securities, notes or other obligations received by the
Company or any such Subsidiary from such transferee that are promptly,
subject to ordinary settlement periods, converted by the Company or
such Subsidiary into cash (to the extent of the cash received in that
conversion).
(3) following the consummation of such Asset Sale, at least five
Facilities that have achieved commercial operation continue to be owned and
controlled by the Company and its Subsidiaries; and
(4) if the assets disposed of in such Asset Sale include any component
of a Facility that is necessary for the operation of such Facility, then
the Asset Sale must involve the disposition of such Facility as a whole.
The Company and its Subsidiaries must use the Net Proceeds from any Asset
Sale (including a Designated Asset Disposition), Casualty Event or Condemnation
Event that remain after any required application of such Net Proceeds to the
repayment of Priority Lien Obligations to make an "Asset Sale Offer" to all
holders of Notes and all holders of other Parity Lien Obligations containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase, repay or redeem with the proceeds of sales of assets, the maximum
principal amount of Notes and such other Parity Lien Obligations that may be
purchased, repaid or redeemed out of such Net Proceeds. The offer price in any
Asset Sale Offer will be equal to 100% of principal amount plus accrued and
unpaid interest to the date of purchase, and will be payable in cash. If any of
such Net Proceeds remain after consummation of an Asset Sale Offer, the Company
and its Subsidiaries may use those excess Net Proceeds for any purpose not
otherwise prohibited by this Indenture, including the making of Restricted
Payments in accordance with the covenant described in Section 4.07 hereof. If
the aggregate principal amount of Notes and other Parity Lien Obligations
tendered into such Asset Sale Offer exceeds the amount of such excess Net
Proceeds, the Issuers will select the Notes and such other Parity Lien
Obligations to be purchased on a pro rata basis.
50
The Issuers will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with each
repurchase of notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of
Sections 3.09 or 4.10 of this Indenture, the Issuers will comply with the
applicable securities laws and regulations and will not be deemed to have
breached their obligations under those provisions of this Indenture by virtue of
such compliance.
Section 4.11 Transactions with Affiliates.
The Company will not, and will not permit any of its Subsidiaries to, make
any payment to, or sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter into
or make or amend any transaction, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate of the Company
(each, an "Affiliate Transaction"), unless:
(1) the Affiliate Transaction is on terms that are no less favorable
to the Company or the relevant Subsidiary than those that would have been
obtained in a comparable transaction by the Company or such Subsidiary with
an unrelated Person; and
(2) The Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $5.0 million, a resolution of the Board of Directors set
forth in an officers' certificate certifying that such Affiliate
Transaction complies with this covenant and that such Affiliate
Transaction has been approved by a majority of the Board of Directors;
(b) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in
excess of $15.0 million, a positive opinion as to the Fair Market
Value of such Affiliate Transaction issued by an accounting, appraisal
or investment banking firm of national standing; and
(c) with respect to any Affiliate Transaction or series of
Affiliate Transactions constituting the sale or other disposition of a
Facility, an opinion as to the fairness to the Company or such
Subsidiary of such Affiliate Transaction from a financial point of
view issued by an accounting, appraisal or investment banking firm of
national standing.
The following items will not be deemed to be Affiliate Transactions and,
therefore, will not be subject to the provisions of the prior paragraph:
(1) any employment agreement, employee benefit plan, officer and
director indemnification agreement or any similar arrangement entered into
by the Company or any of its Subsidiaries in the ordinary course of
business;
(2) transactions between or among the Company and/or its Subsidiaries;
(3) transactions with a Person that is an Affiliate of the Company
solely because the Company owns, directly or through a Subsidiary, an
Equity Interest in, or controls, such Person;
51
(4) payment of reasonable directors' fees to Persons who are not
otherwise Affiliates of the Company;
(5) any issuance of Equity Interests (other than Disqualified Stock)
of the Company to Affiliates of the Company; provided that such Equity
Interests are included in the Collateral;
(6) Restricted Payments that do not violate the provisions of Section
4.07 hereof;
(7) loans or advances to employees in the ordinary course of business
not to exceed $1.0 million in the aggregate at any one time outstanding;
(8) Permitted Payments to Parent;
(9) the Hillabee Disposition;
(10) transactions pursuant to written agreements with Affiliates of
the Company in place as of the date hereof, including transactions entered
into by the Company or its Subsidiaries with third-parties that are not at
that time Affiliates on behalf and at the direction of CES pursuant to the
Index Based Gas Sale and Power Purchase Agreement;
(11) any amendments or modifications of, or waivers under, any written
agreement described under clause 10 of this paragraph that is not a Major
Project Document; provided that no such amendment, modification or waiver
alters any such agreement in a manner than is materially adverse to the
interests of Holders;
(12) amendments or modifications of, or waivers under, any Major
Project Document, which are permitted by the covenant described under
Section 4.13 hereof, and are on terms that are no less favorable to the
Company or its relevant Subsidiary (as certified to the Trustee in an
officer's certificate) than those that would have been obtained in a
comparable transaction by the Company or such Subsidiary with an unrelated
Person; and
(13) any agreement to do any of the foregoing.
Section 4.12 Liens.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to exist any Lien of any
kind on any asset now owned or hereafter acquired, except Permitted Liens.
Section 4.13 Business Activities.
The Company will not, and will not permit any of its Subsidiaries to,
engage in any business other than Permitted Businesses, except to such extent as
would not be material to the Company and its Subsidiaries taken as a whole.
The Company will, and will cause its Subsidiaries to, perform all their
obligations under the Major Project Documents, and the Company will not, and
will not permit any of its Subsidiaries to, terminate, amend or otherwise
modify, or consent to any termination, amendment or modification of, or grant
any waiver under, any Major Project Document, unless any failure to so perform
or any such termination, amendment, modification or waiver would not reasonably
be expected to, when taken together with all other such failures to perform,
terminations, amendments, modifications and waivers
52
since the date hereof, be materially adverse to the Holders, as evidenced by a
certificate of the chief financial officer of the Company (it being understood
that any such failure to perform or any such termination, amendment,
modification or waiver would be materially adverse to the Holders if the Excess
Cash Flow for the Company's most recently ended four full fiscal quarters for
which internal financial statements are available immediately preceding the date
on which such failure to perform occurred or such termination, amendment,
modification or waiver became effective, as applicable, would have decreased by
more than 5.0%, determined on a pro forma basis as if all such failures to
perform had occurred and all such terminations, amendments, modifications and
waivers had been effective at the beginning of such four-quarter period) .
The Company will, and will cause its Subsidiaries to, obtain and maintain
all permits and approvals necessary for the construction and operation of the
Facilities, including applicable exemptions from PUHCA, unless the failure to do
so would not reasonably be expected to have a Material Adverse Effect.
The Company will not, and will not permit any of its Subsidiaries to, use
or dispose of any hazardous materials or allow any hazardous materials to be
brought onto or stored or used on or transported to or released from the
Facilities, other than in accordance with prudent industry practices and in
compliance with all applicable environmental laws, except to the extent such
non-compliance, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.
On or prior to January 1, 2005, the Company will either (1) complete the
Osprey Facility in accordance with the standards for completion contained in the
Calpine Project Undertaking or (2) sell the Osprey Facility in accordance with
Section 4.10 hereof.
Section 4.14 Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect:
(1) its corporate existence, and the corporate, partnership or other
existence of each of its Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of
the Company or any such Subsidiary; and
(2) the rights (charter and statutory), licenses and franchises of the
Company and its Subsidiaries; provided, however, that the Company shall not
be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Subsidiaries, if
the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Subsidiaries, taken as a whole, and that the loss thereof is not adverse in
any material respect to the Holders of the Notes.
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, the Issuers will make an
offer (a "Change of Control Offer") to each Holder to repurchase all or any part
(equal to $1,000 or an integral multiple of $1,000) of each Holder's Notes at a
purchase price in cash equal to 101% of the aggregate principal amount thereof
plus accrued and unpaid interest on the Notes repurchased, if any, to, but
excluding, the date of purchase (the "Change of Control Payment"), subject to
the rights of Holders on the relevant record date to receive interest due on the
relevant interest payment date. Within 30 days following any Change of Control,
the Issuers will mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and stating:
53
(1) that the Change of Control Offer is being made pursuant to this
Section 4.15 and that all Notes tendered will be accepted for payment;
(2) the purchase price and the purchase date, which shall be no
earlier than 30 days and no later than 60 days from the date such notice is
mailed (the "Change of Control Payment Date");
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in the payment of the Change of
Control Payment, all Notes accepted for payment pursuant to the Change of
Control Offer will cease to accrue interest after the Change of Control
Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to a
Change of Control Offer will be required to surrender the Notes, with the
form entitled "Option of Holder to Elect Purchase" on the reverse of the
Notes completed, to the Paying Agent at the address specified in the notice
prior to the close of business on the third Business Day preceding the
Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the second
Business Day preceding the Change of Control Payment Date, a telegram,
telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Notes delivered for purchase, and a
statement that such Holder is withdrawing his election to have the Notes
purchased; and
(7) that Holders whose Notes are being purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, which unpurchased portion must be equal to $1,000 in
principal amount or an integral multiple thereof.
The Issuers will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the
repurchase of the Notes as a result of a Change in Control. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Sections 4.15, the Issuers will comply with the applicable
securities laws and regulations and will not be deemed to have breached their
obligations under this Section 4.15 by virtue of such compliance.
(b) On the Change of Control Payment Date, the Issuers will, to the
extent lawful:
(1) accept for payment all Notes or portions thereof properly
tendered pursuant to the Change of Control Offer;
(2) deposit with the Paying Agent an amount equal to the Change
of Control Payment in respect of all Notes or portions of Notes
properly tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes so
properly accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being
purchased by the Issuers.
The Paying Agent will promptly mail to each Holder of Notes properly
tendered the Change of Control Payment for such Notes, and the Trustee, at the
written request of the Company, will promptly authenticate and mail (or cause to
be transferred by book entry) to each Holder a new Note equal in
54
principal amount to any unpurchased portion of the Notes surrendered, if any;
provided that each new Note will be in a principal amount of $1,000 or an
integral multiple thereof. The Issuers will publicly announce the results of the
Change of Control Offer on or as soon as practicable after the Change of Control
Payment Date.
The provisions described above that require the Issuers to make a Change of
Control Offer following a Change in Control will be applicable whether or not
any other provisions of this Indenture are applicable. Except as described above
with respect to a Change in Control, this Indenture does not contain provisions
that permit the Holders to require that the Issuers repurchase or redeem the
Notes in event of a takeover, recapitalization or similar transaction.
(c) Notwithstanding anything to the contrary in this Section 4.15, the
Issuers will not be required to make a Change of Control Offer upon a Change of
Control if (1) a third party makes the Change of Control Offer in the manner, at
the times and otherwise in compliance with the requirements set forth in this
Section 4.15 hereof and purchases all Notes properly tendered and not withdrawn
under the Change of Control Offer, or (2) notice of redemption has been given
pursuant to Section 3.07 hereof, unless and until there is a default in payment
of the applicable redemption price.
Section 4.16 Limitation on Issuances and Sales of Equity Interests in
Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries to,
transfer, convey, sell, lease or otherwise dispose of any Equity Interests in
any Subsidiary of the Company to any Person (other than the Company or a Wholly
Owned Subsidiary of the Company), unless:
(1) such transfer, conveyance, sale, lease or other disposition is of
all the Equity Interests in such Subsidiary; and
(2) the Net Proceeds from such transfer, conveyance, sale, lease or
other disposition are applied in accordance with Section 4.10 hereof.
In addition, the Company will not permit any Subsidiary of the Company to
issue any of its Equity Interests (other than, if necessary, shares of its
Capital Stock constituting directors' qualifying shares) to any Person other
than to the Company or a Wholly Owned Subsidiary of the Company.
Section 4.17 Payments for Consent.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration to or for the
benefit of any holder of Secured Debt for or as an inducement to any consent,
waiver or amendment of any of the terms or provisions of any Secured Debt
Document unless such consideration is offered to be paid and is paid to all
holders of Secured Debt that consent, waive or agree to amend in the time frame
set forth in the solicitation documents relating to such consent, waiver or
agreement.
Section 4.18 Hillabee Facility.
The Company will not consummate any Asset Sale, incur any Indebtedness,
grant any Liens, make any Investment (other than an Investment made solely with
the proceeds of a capital contribution from Calpine or an Affiliate thereof
(other than the Company or any of its Subsidiaries)) or enter into or engage in
any other transaction with respect to the Hillabee Facility, other than (1) as
existing on the closing date for the issuance of the Notes and (2) as required
or expressly provided for by the terms of this Indenture or the Security
Documents (including the Hillabee Disposition).
55
Section 4.19 Restrictions on Activities of Finance Corp.
Finance Corp. will not hold any material assets, become liable for any
material obligations or engage in any significant business activities; provided
that Finance Corp. may be a co-obligor or guarantor with respect to Indebtedness
if the Company is an obligor on such Indebtedness and the net proceeds of such
Indebtedness are received by the Company, Finance Corp. or one or more of the
Company's other Subsidiaries.
Section 4.20 Deposit of Revenues.
The Company will, and will cause its Subsidiaries to, deposit all revenues
received by the Company and its Subsidiaries, within two business days of
receipt thereof, in a revenue account to be established for the benefit of the
holders of Secured Obligations and in which the Collateral Agent will be granted
a security interest (subject to Permitted Liens). The Security Documents will
set forth the procedures for withdrawal of funds on deposit in the revenue
account.
Section 4.21 Additional Subsidiaries.
If the Company or any of its Subsidiaries acquires or creates another
Subsidiary after the date hereof, then (1) that newly acquired or created
Subsidiary will become a Guarantor and execute a supplemental indenture in the
form of Exhibit F hereto and deliver an opinion of counsel reasonably
satisfactory to the Trustee within 30 days of the date on which it was acquired
or created, and (2) all Equity Interests in that Subsidiary and all real and
personal property of that Subsidiary will become part of the Collateral within
30 days of the date on which that Subsidiary was acquired or created pursuant to
documentation (including Security Documents, financing statements, opinions and
other documents) reasonably satisfactory to the Trustee and the Collateral
Agent.
The Company will not, and will not permit any of its Subsidiaries to,
acquire or create any additional Subsidiaries other than Wholly Owned
Subsidiaries.
Section 4.22 Maintenance of Insurance.
The Company shall, and shall cause its Subsidiaries to, maintain with
financially sound and reputable insurance companies, insurance on their property
and assets (including the Collateral), in at least such amounts, with such
deductibles and against at least such risks as is customary for companies of the
same or similar size engaged in the same or similar businesses as those of the
Company and its Subsidiaries and furnish to the Collateral Agent, upon written
request, full information as to such Persons' property and liability insurance
carriers. The Company shall, and shall cause its Subsidiaries to, cause all
their liability insurance policies to name the Secured Parties, as a class, as
additional insureds and shall cause all its property and casualty policies to
name the Collateral Agent as sole loss payee.
ARTICLE 5.
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
The Company shall not, directly or indirectly: (1) consolidate or merge
with or into another Person (whether or not the Company is the surviving
corporation); (2) or sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company and its
Subsidiaries taken as a whole, in one or more related transactions, to another
Person; or (3) lease all or substantially all of its properties or assets, in
one or more related transactions, to any other Person. This Section 5.01 will
not apply to (A) a merger of the Company with an Affiliate solely for the
purpose of reconstituting the
56
Company in another jurisdiction or (B) any sale, assignment, transfer,
conveyance, lease or other disposition of assets between or among the Company
and its Subsidiaries.
Notwithstanding the foregoing, the Company is permitted to reorganize as a
corporation or a limited liability company in accordance with the procedures
established herein , provided that the Company shall have delivered to the
Trustee an opinion of counsel in the United States reasonably acceptable to the
Trustee confirming that such reorganization is not adverse to Holders (it being
recognized that such reorganization shall not be deemed adverse to the Holders
solely because (i) of the accrual of deferred tax liabilities resulting from
such reorganization or (ii) the successor or surviving corporation (a) is
subject to income tax as a corporate entity or (b) is considered to be an
"includable corporation" of an affiliated group of corporations within the
meaning of the Internal Revenue Code of 1986, as amended or any similar state or
local law) and certain other conditions are satisfied.
Section 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company in a transaction that is subject to, and that complies with the
provisions of, Section 5.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which such sale,
assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture referring to the "Company" shall refer instead to
the successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; provided, however, that
the predecessor Company shall not be relieved from the obligation to pay the
principal of and interest on the Notes except in the case of a sale of all of
the Company's assets in a transaction that is subject to, and that complies with
the provisions of, Section 5.01 hereof.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
Each of the following is an "Event of Default":
(1) the Company defaults for 30 days in the payment when due of
interest on the Notes;
(2) the Company defaults in the payment when due (at maturity, upon
redemption or otherwise) of the principal of, or premium, if any, on the
Notes;
(3) the Company or any of its Subsidiaries fails to comply with the
provisions of Section 4.10, the fifth paragraph of Section 4.13, 4.15, 4.20
or 5.01 hereof;
(4) the Company or any of its Subsidiaries fails to observe or perform
any other covenant, representation, warranty or other agreement in this
Indenture, or the Security Documents for 30 days after notice to the
Company by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding voting as a single class;
(5) a default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money
57
borrowed by the Company or any of its Subsidiaries (or the payment of which
is guaranteed by the Company or any of its Subsidiaries), whether such
Indebtedness or guarantee now exists, or is created after the date hereof,
if that default:
(A) is caused by a failure to pay principal of, or interest or
premium, if any, on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such default
(a "Payment Default"); or
(B) results in the acceleration of such Indebtedness prior to its
express maturity,
and, in each case, the principal amount of any such Indebtedness, together
with the principal amount of any other such Indebtedness under which there
has been a Payment Default or the maturity of which has been so
accelerated, aggregates $5.0 million or more;
(6) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company
or any of its Subsidiaries, which judgment or judgments are not paid,
discharged or stayed for a period of 60 days; provided that the aggregate
of all such undischarged judgments exceeds $5.0 million;
(7) the Company or any of its Subsidiaries pursuant to or within the
meaning of Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a custodian of it or for all
or substantially all of its property,
(D) makes a general assignment for the benefit of its creditors,
or
(E) generally is not paying its debts as they become due; or
(8) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any of its Subsidiaries
in an involuntary case;
(B) appoints a custodian of the Company or any of its
Subsidiaries or for all or substantially all of the property of the
Company or any of its Subsidiaries; or
(C) orders the liquidation of the Company or any of its
Subsidiaries;
and the order or decree remains unstayed and in effect for 60 consecutive
days;
(9) the repudiation by any Parent or the Company, or any of its
Subsidiaries of any of its obligations under the Security Documents or the
unenforceability of the Security Documents against any Parent or the
Company or any of its Subsidiaries for any reason, provided
58
that such repudiation or unenforceability relates to Collateral with a Fair
Market Value of $5.0 Million or more;
(10) except as permitted by this Indenture, any Subsidiary Guarantee
is held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor, or
any Person acting on behalf of any Guarantor, shall deny or disaffirm its
obligations under its Subsidiary Guarantee; and
(11) breach by any Person (other than the Company or any of its
Subsidiaries) of its obligations under, or termination or failure to be in
full force and effect of, a Major Project Document, unless such breach,
termination or failure to be in full force and effect would not reasonably
be expected to, when taken together with all other such breaches,
terminations or failures since the date hereof (other than those that have
been cured as contemplated below, including by entering into a replacement
agreement), be materially adverse to the Holders, as evidenced by a
certificate of the chief financial officer of the Company (it being
understood that any such breach, termination or failure would be materially
adverse to the Holders if the Excess Cash Flow for the Company's most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
breach, termination or failure occurred would have decreased by more than
5.0%, determined on a pro forma basis as if all such breaches, terminations
and failures had occurred at the beginning of such four-quarter period),
unless with respect to any Major Project Document such breach is cured, or
such Major Project Document is replaced with a substantially similar
agreement (it being understood that an agreement will be considered
substantially similar if it would not be materially adverse to the Holders,
as determined by the standard set forth in the previous parenthetical),
within 60 days thereafter.
The Issuers are required to deliver to the Trustee annually a statement
regarding compliance with this Indenture. Promptly after becoming aware of any
Default or Event of Default, the Issuers are required to deliver to the Trustee
a statement specifying such Default or Event of Default.
Section 6.02 Acceleration.
In the case of an Event of Default specified in clause (7) or (8) of
Section 6.01 hereof, with respect to the Company or any of its Subsidiaries, all
outstanding Notes will become due and payable immediately without further action
or notice. If any other Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately.
Upon any such declaration, the Notes shall become due and payable
immediately. Notwithstanding the foregoing, if an Event of Default specified in
clause (7) or (8) of Section 6.01 hereof occurs with respect to the Company or,
any of its Subsidiaries all outstanding Notes shall be due and payable
immediately without further action or notice. The Holders of a majority in
aggregate principal amount of the then outstanding Notes by written notice to
the Trustee may on behalf of all of the Holders rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default (except nonpayment of principal, interest
or premium that has become due solely because of the acceleration) have been
cured or waived.
If an Event of Default occurs by reason of any willful action (or inaction)
taken (or not taken) by or on behalf of the Company with the intention of
avoiding payment of the premium that the Company would have had to pay if the
Company then had elected to redeem the Notes pursuant to Section 3.07 hereof,
then, upon acceleration of the Notes, an equivalent premium shall also become
and be
59
immediately due and payable, to the extent permitted by law, anything in this
Indenture or in the Notes to the contrary notwithstanding.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by written notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium, if any, or interest on, the Notes
(including in connection with an offer to purchase); provided, however, that the
Holders of a majority in aggregate principal amount of the then outstanding
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration. Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
Section 6.05 Control by Majority.
Holders of a majority in aggregate principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, that the Trustee determines may be unduly
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.
Section 6.06 Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(1) the Holder of a Note gives to the Trustee notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
then outstanding Notes make a request to the Trustee to pursue the remedy;
(3) such Holder of a Note or Holders of Notes offer the Trustee
reasonable security or indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
60
(5) during such 60-day period the Holders of a majority in aggregate
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of
another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium, if any, and interest
on the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase), or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder; provided that a Holder
shall not have the right to institute any such suit for the enforcement of
payment if and to the extent that the institution or prosecution thereof or the
entry of judgment therein would, under applicable law, result in the surrender,
impairment, waiver or loss of the Lien of this Indenture upon any property
subject to such Lien.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
Section 6.09 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Company
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each Holder to make such payments to
the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to
it for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
61
Section 6.10 Priorities.
Subject to the rights of the Priority Lien Debt, including, without
limitation, under the Collateral Trust Agreement, if the Trustee collects any
money pursuant to this Article 6, it shall pay out the money in the following
order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes
for principal, premium, if any, and interest, ratably, without preference
or priority of any kind, according to the amounts due and payable on the
Notes for principal, premium, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder of a Note pursuant
to Section 6.07 hereof, or a suit by Holders of more than 10% in aggregate
principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee will
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee will be determined solely by the express
provisions of this Indenture and the Trustee need perform only those duties
that are specifically set forth in this Indenture and no others, and no
implied covenants or obligations shall be read into this Indenture against
the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or
62
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, the Trustee will examine the certificates and
opinions to determine whether or not they conform to the requirements of
this Indenture (but need not confirm or investigate the accuracy of any
calculations or other facts stated therein).
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section 7.01;
(2) the Trustee will not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is conclusively determined
by a court of competent jurisdiction that the Trustee was negligent in
ascertaining the pertinent facts; and
(3) the Trustee will not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), and (c) of this Section 7.01.
(e) No provision of this Indenture will require the Trustee to expend or
risk its own funds or incur any liability. The Trustee will be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holder has offered to the Trustee security
and indemnity satisfactory to it against any loss, liability or expense.
(f) The Trustee will not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company. Money held in trust
by the Trustee need not be segregated from other funds except to the extent
required by law.
Section 7.02 Rights of Trustee.
(a) The Trustee may conclusively rely upon any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee will not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel will be
full and complete authorization and protection from liability in respect of any
action taken, suffered or omitted by it hereunder in good faith and in reliance
thereon.
(c) The Trustee may act through its attorneys and agents and will not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee will not be liable for any action it takes or omits to take
in good faith that it believes to be authorized or within the rights or powers
conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Company will be sufficient if signed by an
Officer of the Company.
63
(f) The Trustee will be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities that might be incurred
by it in compliance with such request or direction.
(g) In no event shall the Trustee be required to take notice of any default
or breach hereof or any Event of Default hereunder unless and until the Trustee
shall have received from a Holder of a Note or from the Company written notice
of the circumstances constituting the breach, default or Event of Default and
stating that said circumstances constitute an Even of Default hereunder.
(h) If the Trustee is acting as Paying Agent and/or Registrar hereunder,
the rights and protections afforded to the Trustee pursuant to this Article 7
will also be afforded to such Paying Agent and Registrar.
Section 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days after determining such conflicting interest, apply
to the SEC for permission to continue as trustee or resign to the extent and in
the manner provided by, and subject to the provisions of, the TIA and this
Indenture. Any Agent may do the same with like rights and duties. The Trustee is
also subject to Sections 7.10 and 7.11 hereof.
Section 7.04 Trustee's Disclaimer.
The Trustee will not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it will not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it will not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee will mail to Holders of Notes a notice of the
Default or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders of the Notes.
Section 7.06 Reports by Trustee to Holders of the Notes.
(a) Within 60 days after each May 15 beginning with the May 15 following
the date hereof, and for so long as Notes remain outstanding, the Trustee will
mail to the Holders of the Notes a brief report dated as of such reporting date
that complies with TIA ss. 313(a) (but if no event described in TIA ss. 313(a)
has occurred within the twelve months preceding the reporting date, no report
need be transmitted). The Trustee also will comply with TIA ss. 313(b)(2). The
Trustee will also transmit by mail all reports as required by TIA ss. 313(c).
64
(b) A copy of each report at the time of its mailing to the Holders of
Notes will be mailed by the Trustee to the Company and filed by the Trustee with
the SEC and each stock exchange on which the Notes are listed in accordance with
TIA ss. 313(d). The Company will promptly notify the Trustee when the Notes are
listed on any stock exchange.
Section 7.07 Compensation and Indemnity.
(a) The Company will pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation will not be limited by any law on compensation of a
trustee of an express trust. The Company will reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses will
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
(b) The Company and the Guarantors will indemnify the Trustee against any
and all losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture and any other Note Documents to which it is a party, including the
costs and expenses of enforcing this Indenture and any other Note Documents to
which it is a party against the Company and the Guarantors (including this
Section 7.07) and defending itself against any claim (whether asserted by the
Company, the Guarantors or any Holder or any other Person) or liability, loss or
expense incurred by it in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability or
expense may be attributable to its negligence or bad faith as finally determined
by a court of competent jurisdiction. The Trustee will notify the Company
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Company will not relieve the Company or any of the Guarantors of
their obligations hereunder. The Company or such Guarantor will defend the claim
and the Trustee will cooperate in the defense. The Trustee may have separate
counsel and the Company will pay the reasonable fees and expenses of such
counsel. Neither the Company nor any Guarantor need pay for any settlement made
without its consent, which consent will not be unreasonably withheld.
(c) The obligations of the Company and the Guarantors under this Section
7.07 will survive the satisfaction and discharge of this Indenture.
(d) To secure the Company's payment obligations in this Section 7.07, the
Trustee will have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal and
interest on particular Notes. Such Lien will survive the satisfaction and
discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(7) or (8) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
(f) The Trustee will comply with the provisions of TIAss. 313(b)(2) to the
extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a successor
Trustee will become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
65
(b) The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so notifying the Company. The Holders of a majority
in aggregate principal amount of the then outstanding Notes may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company may
remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(3) a custodian or public officer takes charge of the Trustee or its
property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company will promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in aggregate principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
(d) If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in aggregate principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(e) If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
(f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee will mail a notice of its succession
to Holders. The retiring Trustee will promptly transfer all property held by it
as Trustee to the successor Trustee, provided all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 hereof will continue for the
benefit of the retiring Trustee.
Section 7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act will be the successor Trustee.
Section 7.10 Eligibility; Disqualification.
There will at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and (i) in the case of the initial Trustee, that also satisfies the
eligibility requirements for a trustee under the TIA and (ii) in the case of any
successor Trustee, that has a combined capital and surplus of at least $100
million as set forth in its most recent published annual report of condition.
66
This Indenture will always have a Trustee who satisfies the requirements of
TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA ss. 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to 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.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Issuers may, at their option at any time, elect to have either Section
8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the
conditions set forth below in this Article 8.
Section 8.02 Legal Defeasance and Discharge.
Upon the Issuers' exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Issuers and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04 hereof,
be deemed to have been discharged from their obligations with respect to all
outstanding Notes (including the Subsidiary Guarantees) on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For
this purpose, Legal Defeasance means that the Issuers and the Guarantors will be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes (including the Subsidiary Guarantees), which will thereafter
be deemed to be "outstanding" only for the purposes of Section 8.05 hereof and
the other Sections of this Indenture referred to in clauses (1) and (2) below,
and to have satisfied all their other obligations under such Notes, the
Subsidiary Guarantees and this Indenture (and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging the
same), except for the following provisions which will survive until otherwise
terminated or discharged hereunder:
(1) the rights of Holders of outstanding Notes to receive payments in
respect of the principal of, or interest or premium, if any, on such Notes
when such payments are due from the trust referred to in Section 8.04
hereof;
(2) the Issuers' obligations with respect to such Notes under Article
2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of the Trustee
hereunder and the Issuers' and the Guarantors' obligations in connection
therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Issuers may exercise their
option under this Section 8.02 notwithstanding the prior exercise of their
option under Section 8.03 hereof.
Section 8.03 Covenant Defeasance.
Upon the Issuers' exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Issuers and the Guarantors will, subject to
the satisfaction of the conditions set forth in Section 8.04
67
hereof, be released from each of their obligations under the covenants contained
in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16, 4.17, 4.18,
4.19, 4.20, 4.21, 4.22, 4.23 hereof and clause (4) of Section 5.01 hereof with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.04 hereof are satisfied (hereinafter, "Covenant Defeasance"), and
the Notes will thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but will
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes may not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes and Subsidiary Guarantees, the Issuers and the Guarantors may
omit to comply with and will have no liability in respect of any term, condition
or limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other
document and such omission to comply will not constitute a Default or an Event
of Default under Section 6.01 hereof, but, except as specified above, the
remainder of this Indenture and such Notes and Subsidiary Guarantees will be
unaffected thereby. In addition, upon the Issuers' exercise under Section 8.01
hereof of the option applicable to this Section 8.03 hereof, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, Sections
6.01(3) through 6.01(5) hereof will not constitute Events of Default.
Section 8.04 Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance under
either Section 8.02 or 8.03 hereof:
(1) the Issuers must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized investment bank,
appraisal firm or firm of independent public accountants, to pay the
principal of, or interest and premium, if any, on the outstanding Notes on
the stated date for payment thereof or on the applicable redemption date,
as the case may be and the Issuers must specify whether the Notes are being
defeased to maturity or to a particular redemption date;
(2) in the case of an election under Section 8.02 hereof, the Issuers
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that:
(A) the Issuers have received from, or there has been published
by, the Internal Revenue Service a ruling; or
(B) since the date hereof, there has been a change in the
applicable federal income tax law;
in either case to the effect that, and based thereon such Opinion of
Counsel shall confirm that, the Holders of the outstanding Notes will not
recognize income, gain or loss for federal income tax purposes as a result
of such Legal Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(3) in the case of an election under Section 8.03 hereof, the Issuers
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to
68
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
(4) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit);
(5) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any material
agreement or instrument (other than this Indenture or the Security
Documents) to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound;
(6) the Issuers must deliver to the Trustee an Officers' Certificate
stating that the deposit was not made by the Issuers with the intent of
preferring the Holders of Notes over the other creditors of the Issuers
with the intent of defeating, hindering, delaying or defrauding creditors
of the Issuers or others; and
(7) the Issuers must deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
provided for or relating to the Legal Defeasance or the Covenant Defeasance
have been complied with.
Section 8.05 Deposited Money and Government Securities to be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
will be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Company will pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.
Notwithstanding anything in this Article 8 to the contrary, the Trustee
will deliver or pay to the Issuers from time to time upon the request of the
Issuers any money or non-callable Government Securities held by them as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized
investment bank, appraisal firm or firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee (which may
be the opinion delivered under Section 8.04(1) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06 Repayment to Company.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Issuers, in trust for the payment of the principal of, premium, if any, or
interest on any Note and remaining unclaimed for two years after such principal,
premium, if any, or interest has become due and payable shall be paid to
69
the Issuers on their request or (if then held by the Issuers) will be discharged
from such trust; and the Holder of such Note will thereafter be permitted to
look only to the Issuers for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Issuers as trustee thereof, will thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which will not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Issuers.
Section 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States dollars
or non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Issuers' and the Guarantor's obligations under this
Indenture and the Notes and the Subsidiary Guarantees will be revived and
reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03
hereof until such time as the Trustee or Paying Agent is permitted to apply all
such money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Issuers make any payment of principal of,
premium, if any, or interest on any Note following the reinstatement of its
obligations, the Issuers will be subrogated to the rights of the Holders of such
Notes to receive such payment from the money held by the Trustee or Paying
Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Issuers, the Guarantors
and the Trustee may amend or supplement this Indenture, the Security Documents,
the Subsidiary Guarantees or the Notes without the consent of any Holder of a
Note:
(1) to cure any ambiguity, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes or to alter the provisions of Article 2 hereof
(including the related definitions) in a manner that does not materially
adversely affect any Holder;
(3) to provide for the assumption of the Issuers' obligations to the
Holders of the Notes by a successor to the Issuers pursuant to Article 5
hereof;
(4) to make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the
legal rights hereunder of any Holders of the Notes;
(5) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(6) to make, complete or confirm any grant of Collateral permitted or
required by this Indenture or any of the Security Documents or any release
of Collateral that becomes effective as set forth in this Indenture or any
of the Security Documents;
70
(7) to conform the text of this Indenture, the Subsidiary Guarantees,
the Security Documents or the Notes to any provision of the Description of
Notes to the extent that such provision in such "Description of Notes"
section contained in the Offering Circular was intended to be a verbatim
recitation of a provision of this Indenture, the Subsidiary Guarantees, the
Security Documents or the Notes;
(8) to reflect any waiver or termination of any right arising under
the provisions of this Indenture that otherwise would be enforceable by any
holder of a Term Loan Obligation, if such waiver or termination is set
forth in the agreement governing such Term Loan Obligation, provided that
no such waiver or amendment shall adversely affect the rights of Holders of
Notes;
(9) to provide for the issuance of Additional Notes in accordance with
the limitations set forth in this Indenture as of the date hereof; or
(10) to allow any Guarantor to execute a supplemental indenture in the
form of Exhibit F hereto and/or a Subsidiary Guarantee with respect to the
Notes.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee will join with the Company and the Guarantors in the
execution of any amended or supplemental indenture authorized or permitted by
the terms of this Indenture and to make any further appropriate agreements and
stipulations that may be therein contained, but the Trustee will not be
obligated to enter into such amended or supplemental indenture that affects its
own rights, duties or immunities under this Indenture or otherwise.
Section 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and the Trustee
may amend or supplement this Indenture (including, without limitation, Section
3.09, 4.10 and 4.15 hereof), the Subsidiary Guarantees and the Notes with the
consent of the Holders of at least a majority in aggregate principal amount of
the Notes (including, without limitation, Additional Notes) then outstanding
voting as a single class (including, without limitation, consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or
Event of Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture, the Subsidiary Guarantees or the Notes may
be waived with the consent of the Holders of a majority in aggregate principal
amount of the then outstanding Notes voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for, or
purchase of, the Notes). Section 2.08 hereof shall determine which Notes are
considered to be "outstanding" for purposes of this Section 9.02.
Upon the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Notes as aforesaid, and upon receipt by
the Trustee of the documents described in Section 7.02 hereof, the Trustee will
join with the Company in the execution of such amended or supplemental indenture
unless such amended or supplemental indenture directly affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but will not be obligated to, enter into such
amended or supplemental indenture.
71
It will not be necessary for the consent of the Holders of Notes under this
Section 9.02 to approve the particular form of any proposed amendment or waiver,
but it is sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company will mail to the Holders of Notes affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, will not, however, in
any way impair or affect the validity of any such amended or supplemental
indenture or waiver. Subject to Sections 6.04 and 6.07 hereof, the Holders of a
majority in aggregate principal amount of the Notes then outstanding voting as a
single class may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes. However, without the consent of
each Holder affected, an amendment or waiver under this Section 9.02 may not
(with respect to any Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes (other
than the provisions of Sections 3.09, 4.10 and 4.15 hereof);
(3) reduce the rate of or change the time for payment of interest,
including default interest, on any Note;
(4) waive a Default or Event of Default in the payment of principal of
or premium, if any, or interest on the Notes (except a rescission of
acceleration of the Notes by the Holders of at least a majority in
aggregate principal amount of the then outstanding Notes and a waiver of
the payment default that resulted from such acceleration);
(5) make any Note payable in money other than that stated in the
Notes;
(6) make any change in the provisions of this Indenture relating to
waivers of Defaults or Events of Default or the rights of Holders of Notes
to receive payments of principal of, or interest or premium, if any, on the
Notes;
(7) waive a redemption payment with respect to any Note (other than a
payment required under Section 4.10 or Section 4.15);
(8) release any Guarantor from any of its payment obligations under
its Subsidiary Guarantee or this Indenture, except in accordance with the
terms of this Indenture;
(9) release any portion of the Collateral except as expressly
contemplated by this Indenture and the Security Documents; or
(10) make any change in the preceding amendment and waiver provisions;
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes will be set
forth in an amended or supplemental indenture that complies with the TIA as then
in effect.
72
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Holder.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note will not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee will sign any amended or supplemental indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
will be entitled to receive and (subject to Section 7.01 hereof) will be fully
protected in relying upon, in addition to the documents required by Section
13.04 hereof, an Officers' Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
ARTICLE 10.
COLLATERAL AND SECURITY
Section 10.01 Equal and Ratable Sharing of Collateral by Holders of Parity
Lien Debt; Sharing Confirmation.
Notwithstanding (1) anything to the contrary contained in the Security
Documents, (2) the time of incurrence of any Series of Parity Lien Debt, (3) the
order or method of attachment or perfection of any Liens securing any Series of
Parity Lien Debt, (4) the time or order of filing or recording of financing
statements, mortgages or other documents filed or recorded to perfect any Lien
upon any Collateral, (5) the time of taking possession or control over any
Collateral or (6) the rules for determining priority under any law governing
relative priorities of Liens:
(A) all or any portion of the Liens at any time granted by the
Company or any Guarantor to secure any of the Parity Lien Debt shall
secure, equally and ratably, all present and future Parity Lien
Obligations; and
(B) all proceeds of all Liens at any time granted by the Company
or any Guarantor to secure any of the Parity Lien Debt and other
Parity Lien Obligations shall be allocated and distributed equally and
ratably on account of the Parity Lien Debt and
73
other Parity Lien Obligations; provided, that, for the avoidance of
doubt, in the absence of an Event of Default, the Company and the
Guarantors shall be entitled to utilize cash proceeds of Collateral in
the ordinary course of their business.
The foregoing provision is intended for the benefit of, and shall be
enforceable as a third party beneficiary by, each present and future holder of
Parity Lien Obligations, each present and future Parity Debt Representative and
the Collateral Agent as holder of Parity Liens. The Company shall not incur any
future Series of Parity Lien Debt unless the agreement governing such Series of
Parity Lien Debt includes a Sharing Confirmation at the time of incurrence of
such Series of Parity Lien Debt.
Section 10.02 Ranking of Note Liens.
Notwithstanding:
(1) anything to the contrary contained in the Security Documents,
(2) the time of incurrence of any Series of Secured Debt,
(3) the order or method of attachment or perfection of any Liens
securing any Series of Secured Debt,
(4) the time or order of filing or recording of financing statements,
mortgages or other documents filed or recorded to perfect any Lien upon any
Collateral,
(5) the time of taking possession or control over any Collateral or
(6) the rules for determining priority under any law governing
relative priorities of Liens,
all Liens at any time granted by the Company or any Guarantor to secure any of
the Parity Lien Debt shall be subject and subordinate to Priority Liens securing
Priority Lien Obligations up to the Priority Lien Cap.
The foregoing provision is intended for the benefit of, and shall be
enforceable as a third party beneficiary by, each present and future holder of
Priority Lien Obligations, each present and future Priority Debt Representative
and the Collateral Agent as holder of Priority Liens. No other Person shall be
entitled to rely on, have the benefit of or enforce this provision.
In addition, the foregoing provision is intended solely to set forth the
relative ranking, as Liens, of the Liens securing Parity Lien Debt as against
the Priority Liens. Neither the Notes nor any other Parity Lien Obligations nor
the exercise or enforcement of any right or remedy for the payment or collection
thereof are intended to be, or shall ever be by reason of the foregoing
provision, in any respect subordinated, deferred, postponed, restricted or
prejudiced.
Section 10.03 Relative Rights.
Nothing in the Note Documents will:
(1) impair, as between the Company and the Holders of the Notes, the
obligation of the Company to pay principal of, premium and interest, if
any, on the Notes in accordance with their terms or any other obligation of
the Company or any other Obligor under
74
the Note Documents;
(2) affect the relative rights of holders of Note Obligations as
against any other creditors of the Company or any other Obligor under the
Note Documents (other than holders of Priority Liens or other Parity
Liens);
(3) restrict the right of any holder of Note Obligations to xxx for
payments that are then due and owing (but not enforce any judgment in
respect thereof against any Collateral to the extent specifically
prohibited by the provisions set forth in Sections 3.3 and 3.4 of the
Collateral Trust Agreement);
(4) restrict or prevent any holder of Note Obligations, the Trustee,
the Collateral Agent or other Person on their behalf from exercising any of
its rights or remedies upon a Default or Event of Default not specifically
restricted or prohibited by Sections 3.3 and 3.4 of the Collateral Trust
Agreement; or
(5) restrict or prevent any holder of Note Obligations, the Trustee,
the Collateral Agent or other Person on their behalf from taking any lawful
action in an insolvency or liquidation proceeding not specifically
restricted or prohibited by Sections 3.3 and 3.4 of the Collateral Trust
Agreement.
Section 10.04 Release of Security Interest in Respect of Notes.
The Collateral Agent's Liens upon the Collateral shall no longer secure the
Notes or any other Note Obligations, and the right of the holders of the Notes
and such Note Obligations to the benefits and proceeds of the Collateral Agent's
Liens on Collateral shall terminate and be discharged:
(1) upon satisfaction and discharge of this Indenture in accordance
with Article 12 hereof;
(2) upon a Legal Defeasance or Covenant Defeasance of the Notes in
accordance with Article 8 hereof; or
(3) upon payment in full and discharge of all Notes and other Note
Obligations that are outstanding under this Indenture, due and payable
under this Indenture at the time those Notes are paid in full and
discharged.
ARTICLE 11.
SUBSIDIARY GUARANTEES
Section 11.01 Guarantee.
(a) Subject to this Article 11 and the limitations set forth in Section
13.07, each of the Guarantors hereby, jointly and severally, unconditionally
guarantees to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Notes or the obligations of the
Company hereunder or thereunder, that:
(1) the principal of, premium, if any, and interest on the Notes will
be promptly paid in full when due, whether at maturity, by acceleration,
redemption or otherwise, and interest on the overdue principal of and
interest on the Notes, if any, if lawful, and all other obligations of the
75
Company to the Holders or the Trustee hereunder or thereunder will be
promptly paid in full or performed, all in accordance with the terms hereof
and thereof; and
(2) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any performance so
guaranteed for whatever reason, the Guarantors will be jointly and severally
obligated to pay the same immediately. Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.
(b) Subject to the limitations set forth in Section 13.07, the Guarantors
hereby agree that their obligations hereunder are unconditional, irrespective of
the validity, regularity or enforceability of the Notes or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder
of the Notes with respect to any provisions hereof or thereof, the recovery of
any judgment against the Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. Each Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenant that this
Subsidiary Guarantee will not be discharged except by complete performance of
the obligations contained in the Notes and this Indenture.
(c) If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Guarantors or any custodian, trustee, liquidator or
other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder, this
Subsidiary Guarantee, to the extent theretofore discharged, will be reinstated
in full force and effect.
(d) Each Guarantor agrees that it will not be entitled to any right of
subrogation in relation to the Holders in respect of any obligations guaranteed
hereby until payment in full of all obligations guaranteed hereby. Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 hereof
for the purposes of this Subsidiary Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (2) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) will forthwith become due and
payable by the Guarantors for the purpose of this Subsidiary Guarantee. The
Guarantors will have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Subsidiary Guarantee.
Section 11.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance
for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or state law to the
extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree
that the obligations of such Guarantor will be limited to the maximum amount
that will, after giving effect to such maximum amount and all other contingent
and fixed liabilities of such Guarantor that are relevant under such laws, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Guarantor in respect of the
76
obligations of such other Guarantor under this Article 11, result in the
obligations of such Guarantor under its Subsidiary Guarantee not constituting a
fraudulent transfer or conveyance.
Section 11.03 Execution and Delivery of Subsidiary Guarantee.
To evidence its Subsidiary Guarantee set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form attached as Exhibit E hereto will be endorsed by an
Officer of such Guarantor on each Note authenticated and delivered by the
Trustee and that this Indenture will be executed on behalf of such Guarantor by
one of its Officers.
Each Guarantor hereby agrees that its Subsidiary Guarantee set forth in
Section 11.01 will remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the Subsidiary
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee will
be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof
hereunder, will constitute due delivery of the Subsidiary Guarantee set forth in
this Indenture on behalf of the Guarantors.
In the event that the Company creates or acquires any Subsidiary after the
date hereof, if required by Section 4.21 hereof, the Company will cause such
Subsidiary to comply with the provisions of Section 4.21 hereof and this Article
11, to the extent applicable.
Section 11.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 11.05, no Guarantor may sell or
otherwise dispose of all or substantially all of its assets to, or consolidate
with or merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than the Company or another Guarantor, except as
permitted by Section 4.10 hereof.
In case of any such consolidation, merger, sale or conveyance and upon the
assumption by the successor Person, by supplemental indenture in the form of
Exhibit F hereto, executed and delivered to the Trustee and satisfactory in form
to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the due
and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Guarantor, such successor Person will succeed
to and be substituted for the Guarantor with the same effect as if it had been
named herein as a Guarantor. Such successor Person thereupon may cause to be
signed any or all of the Subsidiary Guarantees to be endorsed upon all of the
Notes issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Trustee. All the Subsidiary Guarantees so issued
will in all respects have the same legal rank and benefit under this Indenture
as the Subsidiary Guarantees theretofore and thereafter issued in accordance
with the terms of this Indenture as though all of such Subsidiary Guarantees had
been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, nothing contained in this
Indenture or in any of the Notes will prevent any consolidation or merger of a
Guarantor with or into the Company or another Guarantor, or will prevent any
sale or conveyance of the property of a Guarantor as an entirety or
substantially as an entirety to the Company or another Guarantor.
77
Section 11.05 Releases Following Sale of Assets.
In the event of any sale or other disposition of all or substantially all
of the assets of any Guarantor, by way of merger, consolidation or otherwise, or
a sale or other disposition of all to the Capital Stock of any Guarantor, in
each case to a Person that is not (either before or after giving effect to such
transactions) the Company or a Subsidiary of the Company, then such Guarantor
(in the event of a sale or other disposition, by way of merger, consolidation or
otherwise, of all of the capital stock of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other disposition of all or
substantially all of the assets of such Guarantor) will be released and relieved
of any obligations under its Subsidiary Guarantee; provided that the Net
Proceeds of such sale or other disposition are applied in accordance with the
applicable provisions of this Indenture, including without limitation Section
4.10 hereof. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee will
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Subsidiary Guarantee.
Any Guarantor not released from its obligations under its Subsidiary
Guarantee will remain liable for the full amount of principal of and interest on
the Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article 11.
ARTICLE 12.
SATISFACTION AND DISCHARGE
Section 12.01 Satisfaction and Discharge.
This Indenture will be discharged and will cease to be of further effect as
to all Notes issued hereunder, when:
(1) either:
(a) all Notes that have been authenticated (except lost, stolen
or destroyed Notes that have been replaced or paid and Notes for whose
payment money has theretofore been deposited in trust and thereafter
repaid to the Issuers) have been delivered to the Trustee for
cancellation; or
(b) all Notes that have not been delivered to the Trustee for
cancellation have become due and payable by reason of the mailing of a
notice of redemption or otherwise or will become due and payable
within one year and the Issuers have or any Guarantor has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in
trust solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as will be sufficient without consideration of any
reinvestment of interest, to pay and discharge the entire indebtedness
on the Notes not delivered to the Trustee for cancellation for
principal, premium, if any, and accrued interest to the date of
maturity or redemption;
(2) no Default or Event of Default has occurred and is continuing on
the date of such deposit or will occur as a result of such deposit and such
deposit will not result in a breach or violation of, or constitute a
default under, any other instrument to which the Issuers are or any
Guarantor is a party or by which the Issuers are or any Guarantor is bound;
78
(3) the Issuers have or any Guarantor has paid or caused to be paid
all sums payable by it under this Indenture; and
(4) the Issuers have delivered irrevocable instructions to the Trustee
under this Indenture to apply the deposited money toward the payment of the
Notes at maturity or the redemption date, as the case may be.
In addition, the Issuers must deliver an Officers' Certificate and an
Opinion of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, if money
has been deposited with the Trustee pursuant to subclause (b) of clause (1) of
this Section, the provisions of Section 12.02 and Section 8.06 will survive. In
addition, nothing in this Section 12.01 will be deemed to discharge those
provisions of Section 7.07 hereof, that, by their terms, survive the
satisfaction and discharge of this Indenture.
Section 12.02 Application of Trust Money.
Subject to the provisions of Section 8.06, all money deposited with the
Trustee pursuant to Section 12.01 shall be held in trust and applied by it, in
accordance with the provisions of the Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including either Issuer acting as
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of
the principal (and premium, if any) and interest for whose payment such money
has been deposited with the Trustee; but such money need not be segregated from
other funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or Government
Securities in accordance with Section 12.01 by reason of any legal proceeding or
by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Company's
and any Guarantor's obligations under Section 12.01; provided that if the
Issuers have made any payment of principal of, premium, if any, or interest on
any Notes because of the reinstatement of its obligations, the Issuers shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money or Government Securities held by the Trustee or Paying Agent.
ARTICLE 13
MISCELLANEOUS
Section 13.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss.318(c), the imposed duties will control.
Section 13.02 Notices.
Any notice or communication by the Issuers, any Guarantor or the Trustee to
the others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
79
If to the Company, Finance Corp. and/or any Guarantor:
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
With a copy to:
Xxxxxxxxx & Xxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxx Xxxxxxx
Stoel Rives LLP
000 XX 0xx Xxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxx Xxxxxxx
If to the Trustee:
Wilmington Trust, FSB
c/o Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxxxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Telcopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxx
With a Copy to:
Xxxxx Peabody LLP
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxx Xxxxxxx
The Company, any Guarantor or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders) will be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt
80
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder will be mailed by first class mail,
certified or registered, return receipt requested, or by overnight air courier
guaranteeing next day delivery to its address shown on the register kept by the
Registrar. Any notice or communication will also be so mailed to any Person
described in TIA ss. 313(c), to the extent required by the TIA. Failure to mail
a notice or communication to a Holder or any defect in it will not affect its
sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Holders, it will mail a
copy to the Trustee and each Agent at the same time.
Section 13.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
Section 13.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.
Section 13.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) must comply with the provisions of TIA ss. 314(e)
and must include:
(3) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(4) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(5) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable him or her
to express an informed opinion as to whether or not such covenant or
condition has been satisfied; and
81
(6) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 13.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 13.07 Non-Recourse; No Personal Liability of Directors, Officers,
Employees and Stockholders.
Notwithstanding anything to the contrary set forth in this Indenture, the
Notes, any Security Document or any other Note Document, the Notes and the
Subsidiary Guarantees are non-recourse secured obligations of the Company and
Guarantors, respectively. The only recourse a holder of the Notes will have with
respect to the payment of principal of, or interest or premium on, the Notes
(whether under the Indenture or the Notes, or pursuant to the Subsidiary
Guarantees) will be enforcement of its rights against Finance Corp. under the
Indenture or against the Collateral pursuant to the Security Documents.
No director, officer, employee, incorporator, stockholder, or partner of
the Company or any of its Subsidiaries, as such, will have any liability for any
obligations of the Issuers or the Guarantors under the Notes, this Indenture,
the Subsidiary Guarantees, or the Security Documents, or for any claim based on,
in respect of, or by reason of, such obligations or their creation. Each Holder
of Notes by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Notes. The waiver
may not be effective to waive liabilities under the federal securities laws.
Section 13.08 Governing Law.
THE INTERNAL LAW OF THE STATE OF NEW YORK WILL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE, THE NOTES AND THE SUBSIDIARY GUARANTEES WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 13.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 13.10 Successors.
All agreements of the Issuers in this Indenture and the Notes will bind
their respective successors. All agreements of the Trustee in this Indenture
will bind its successors. All agreements of each Guarantor in this Indenture
will bind its successors, except as otherwise provided in Section 11.05.
Section 13.11 Severability.
In case any provision in this Indenture or in the Notes is invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions will not in any way be affected or impaired thereby.
82
Section 13.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy will be an original, but all of them together represent the same agreement.
Section 13.13 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and will in no way
modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
83
SIGNATURES
Dated as of August 14, 2003
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
By: /s/ XXXXX XXXX
------------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
CCFC FINANCE CORP.
By: /s/ XXXXX XXXX
------------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
CALPINE HERMISTON, LLC
By: /s/ XXXXX XXXX
------------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
CPN HERMISTON, LLC
By: /s/ XXXXX XXXX
------------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
HERMISTON POWER PARTNERSHIP
By: /s/ XXXXX XXXX
------------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
84
WILMINGTON TRUST FSB,
as Trustee
By: /s/ XXXXX X. XXXXXXXX
------------------------------------------
Name: Xxxxx X. XxXxxxxx
Title: V.P.
85
Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under this Indenture as of the date
hereof:
I-1
EXHIBIT A1
[Face of Note]
________________________________________________________________________________
CUSIP/CINS ____________
Second Priority Senior Secured Floating Rate Notes due 2011
No. ___ $____________
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
CCFC FINANCE CORP.
promises to pay to [CEDE & CO.]
------------
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on August 26, 2011.
Interest Payment Dates: February 26 and August 26
Record Dates: February 11 and August 11
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
CCFC FINANCE CORP.
By:__________________________________________
Name:
Title:
By:__________________________________________
Name:
Title:
Dated: August 14, 2003
This is one of the Notes referred to in the within-mentioned Indenture:
WILMINGTON TRUST FSB,
as Trustee
By:_______________________________________
Authorized Signatory
________________________________________________________________________________
A1-1
[Back of Note]
Second Priority Senior Secured Floating Rate Notes due 2011
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY THE INITIAL
INVESTOR, (1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), AND (B) BY
SUBSEQUENT INVESTORS, AS SET FORTH IN (A) ABOVE, AND, IN ADDITION, TO AN
INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501 OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND, IN THE CASE OF EACH OF CLAUSES (A)
AND (B), IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY AND FINANCE
CORP.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"),
TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY THE
A1-2
INITIAL INVESTOR, (1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2)
IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), AND (B)
BY SUBSEQUENT INVESTORS, AS SET FORTH IN (A) ABOVE, AND, IN ADDITION, TO AN
INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501 OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT AND, IN THE CASE OF EACH OF CLAUSES (A)
AND (B), IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), and CCFC Finance Corp., a Delaware
corporation, ("Finance Corp." and, together with the Company, the
"Issuers") each promises to pay interest on the principal amount of this
Note from August 14, 2003 until maturity. The interest rate on the Notes
will be reset semiannually at the Applicable Note Eurodollar Rate (as
defined below). The Company will pay interest semi-annually in arrears on
February 26 and August 26 of each year, or if any such day is not a
Business Day, on the next succeeding Business Day (each, an "Interest
Payment Date"). Interest on the Notes will accrue from the most recent date
to which interest has been paid or, if no interest has been paid, from the
date of issuance; provided that if there is no existing Default in the
payment of interest, and if this Note is authenticated between a record
date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; provided, further, that the first Interest Payment Date shall
be February 26, 2004. The Company will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium, if any, from time to time on demand at a
rate that is 1% per annum in excess of the rate then in effect; it will pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to
the extent lawful. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
"Applicable Note Eurodollar Rate" means, for each interest period
during which any note is outstanding subsequent to the initial interest
period, 850 basis points over the rate determined by the Company (notice of
such rate to be sent to the Trustee by the Company on the date of
determination thereof) equal to the greater of (x) 1.25% or (y) the
applicable British Bankers' Association LIBOR rate for deposits in U.S.
dollars for a period of six months as reported by any generally recognized
financial information service as of 11:00 a.m. (London time) two business
days prior to the first day of such interest period; provided that, if no
such British Bankers' Association LIBOR rate is available to the Company,
the Applicable Note Eurodollar Rate for the relevant interest period shall
instead be the rate at which Xxxxxxx Xxxxx Credit Partners L.P. or one of
its affiliate banks offers to place deposits in U.S. dollars with
first-class banks in the London interbank market for a period of six months
at approximately 11:00 a.m. (London time) two business days prior to the
first day of such interest period, in amounts
A1-3
equal to $1.0 million. Notwithstanding the foregoing, the Applicable Note
Eurodollar Rate for the initial interest period will be 9.75%.
(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 the February 11 or August 11 immediately
preceding the Interest Payment Date, even if such Notes are canceled after
such record date and on or before such Interest Payment Date, except as
provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes will be payable as to principal, premium, if any, and
interest at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest may be made by check mailed to the Holders at
their addresses set forth in the register of Holders; provided that payment
by wire transfer of immediately available funds will be required with
respect to principal of, interest on and, premium, if any, on, all Global
Notes and all other Notes the Holders of which will have provided wire
transfer instructions to the Company or the Paying Agent. Such payment will
be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
(3) PAYING AGENT AND REGISTRAR. The Company, on behalf of itself and
Finance Corp., will maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent").
The Registrar will keep a register of the Notes and of their transfer and
exchange. The Issuers may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar
and the term "Paying Agent" includes any additional paying agent. The
Issuers may change any Paying Agent or Registrar without notice to any
Holder. The Company will notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. If the Issuers fail to
appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act
as Paying Agent or Registrar. The Issuers initially appoint The Depository
Trust Company ("DTC") to act as Depositary with respect to the Global
Notes. The Issuers initially appoint the Trustee to act as the Registrar
and Paying Agent and to act as Custodian with respect to the Global Notes.
(4) INDENTURE. The Company issued the Notes under an Indenture dated
as of August 14, 2003 (the "Indenture") among the Issuers, the Guarantors
and the Trustee. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code xx.xx. 77aaa-77bbbb). The
Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the
Indenture, the provisions of the Indenture shall govern and be controlling.
The Notes are secured obligations of the Company limited to $365.0 million
in aggregate principal amount. The Notes are secured on a second-priority
basis, equally and ratably with any future Parity Lien Debt by (i) a
security interest in all the assets of the Company other than Excluded
Assets and (ii) a pledge of the equity interests in the Company and its
Subsidiaries (other than CCFC Finance) and all intercompany notes for money
owed to CCFC by any of its Subsidiaries, subject to liens securing the
Priority Lien Debt (including the Term Loans), and other Permitted Liens.
(5) Optional Redemption.
A1-4
(a) Except as set forth in subparagraph (b) of this Paragraph 5, on or
after August 26, 2009, the Issuers may redeem the Notes upon not less than 30
nor more than 60 days' notice, at the redemption prices (expressed as
percentages of principal amount) set forth below plus accrued and unpaid
interest thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on August 26 of the years indicated below, subject
to the rights of Holders on the relevant record dates to receive interest on the
relevant interest payment date:
Year Percentage
---- ----------
2009...................................... 104.250%
2010 to February 25, 2011................. 102.125%
February 26, 2011 and thereafter................ 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this Paragraph 5,
the Issuers may redeem all or a part of the Notes at any time prior to August
26, 2009, upon not less than 30 nor more than 60 days prior notice, at a
redemption price equal to 100% of the principal amount of the Notes redeemed
plus the Applicable Premium as of, and accrued and unpaid interest, if any, to,
the redemption date, subject to the rights of Holders on the relevant record
date to receive interest due on the relevant interest payment date.
(c) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Issuers' option prior to August 26, 2009.
(d) Any redemption pursuant to Section 3.07 of the Indenture shall be made
pursuant to Sections 3.01 through 3.06 thereof. Unless the Issuers default in
the payment of the redemption price, interest will cease to accrue on the Notes
or portions thereof called for redemption on the applicable redemption date.
(6) Mandatory Redemption.
The Issuers will not be required to make mandatory redemption or sinking
fund payments with respect to the Notes.
(7) Repurchase at Option of Holder.
(a) If there is a Change of Control, the Issuers will make an
offer (a "Change of Control Offer") to each Holder to repurchase all
or any part (equal to $1,000 or an integral multiple thereof) of each
Holder's Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest on the Notes
purchased, if any, to, but excluding, the date of purchase (the
"Change of Control Payment"), subject to the rights of Holders on the
relevant record date to receive interest due on the relevant interest
payment date. Within 30 days following any Change of Control, the
Issuers will mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by Section 4.15 of
the Indenture.
(b) The Company and its Subsidiaries must use the Net Proceeds
from any Asset Sale (including a Designated Asset Disposition),
Casualty Event or Condemnation Event that remain after any required
application of such Net Proceeds to the repayment of Priority Lien
Obligations to make an "Asset Sale Offer" to all holders of Notes and
all holders of other Parity Lien Obligations containing provisions
similar to those set forth in the Indenture with respect to offers to
purchase, repay or redeem with the proceeds of sales of assets, the
maximum principal
A1-5
amount of notes and such other Parity Lien Obligations that may be
purchased, repaid or redeemed out of such Net Proceeds. The offer
price in any Asset Sale Offer will be equal to 100% of principal
amount plus accrued and unpaid interest to the date of purchase, and
will be payable in cash. If any of such Net Proceeds remain after
consummation of an Asset Sale Offer, the Company and its Subsidiaries
may use those excess Net Proceeds for any purpose not otherwise
prohibited by the Indenture, including the making of Restricted
Payments in accordance with the covenant described in Section 4.07
thereof. If the aggregate principal amount of notes and other Parity
Lien Obligations tendered into such Asset Sale Offer exceeds the
amount of such excess Net Proceeds, the Issuers will select the notes
and such other Parity Lien Obligations to be purchased on a pro rata
basis.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on
Notes or portions thereof called for redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples
thereof. The transfer of Notes may be registered and Notes may be exchanged
as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture. The Company need
not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture, the Subsidiary Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
aggregate principal amount of the Notes then outstanding (including
consents obtained in connection with a purchase or tender offer or exchange
offer for Notes) voting as a single class, and any existing default or
compliance with any provision of the Indenture, the Subsidiary Guarantees
or the Notes may be waived with the consent of the Holders of a majority in
principal amount of the Notes then outstanding voting as a single class.
Without the consent of any Holder of a Note, the Indenture, the Subsidiary
Guarantees or the Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Notes in
addition to or in place of certificated Notes, to provide for the
assumption of the Company's or any Guarantor's obligations to Holders of
the Notes in case of a merger or consolidation, to make any change that
would provide any additional rights or benefits to the Holders of the Notes
or that does not adversely affect the legal rights under the Indenture of
any such Holder, to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the Trust
Indenture Act, to make, complete or confirm any grant of Collateral
permitted or required by the Indenture or any of the Security Documents or
any release of Collateral that becomes effective as set forth in the
Indenture or any of the Security Documents, to conform the text of the
Indenture, the Subsidiary Guarantees, the Security Documents or the notes
to any provision of the Description of Notes in
A1-6
the Offering Circular to the extent that such provision of the Description
of Notes in the Offering Circular was intended to be a verbatim recitation
of a provision of the Indenture, the Subsidiary Guarantees, the Security
Documents or the notes, to reflect any waiver or termination of any right
arising under the provisions of the Indenture that otherwise would be
enforceable by any holder of a Term Loan Obligation, if such waiver or
termination is set forth in the agreement governing such Term Loan
Obligation, provided that no such waiver or amendment shall adversely
affect the rights of Holders of Notes, to provide for the issuance of
Additional Notes in accordance with the limitations set forth in the
Indenture as of the date hereof, or to allow any Guarantor to execute a
supplemental indenture in the form of Exhibit F to the Indenture and/or a
Note Guarantee with respect to the Notes.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i) default for
30 days in the payment when due of interest on the Notes; (ii) default in
payment when due of the principal of or premium, if any, on the Notes when
the same becomes due and payable at maturity, upon redemption (including in
connection with an offer to purchase) or otherwise, (iii) failure by the
Company to comply with Section 4.10, the fifth paragraph of Section 4.13,
4.15, 4.20 or 5.01 of the Indenture; (iv) failure by the Company or any of
its Subsidiaries to observe or perform any other covenant, representation,
warranty or other agreement in the Indenture, or the Security Documents for
30 days after notice to the Company by the Trustee or the Holders of at
least 25% in aggregate principal amount of the Notes then outstanding
voting as a single class; (v) default under certain other agreements
relating to Indebtedness of the Company which default is caused by the
failure to pay principal of, or interest or premium, if any, on such
Indebtedness or, results in the acceleration of such Indebtedness prior to
its express maturity; (vi) certain final judgments for the payment of money
that remain undischarged for a period of 30 days, provided the aggregate of
such judgments exceeds $5.0 million; (vii) certain events of bankruptcy or
insolvency with respect to the Company or any of its Subsidiaries; and
(viii) the breach or repudiation of certain covenants in the Security
Documents or the enforceability of the Security Documents under certain
circumstances; (ix) except as permitted by the Indenture, any Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any
Guarantor or any Person acting on its behalf shall deny or disaffirm its
obligations under such Guarantor's Subsidiary Guarantee; and (x) the breach
by any Person (other than the Company and its Subsidiaries) of its
obligations under, or the termination or failure to be in full force of, a
Major Project Document, unless such breach when taken together with all
such breaches would be materially adverse to Holders. If any Event of
Default occurs and is continuing, the Trustee or the Holders of at least
25% in aggregate principal amount of the then outstanding Notes may declare
all the Notes to be due and payable. Notwithstanding the foregoing, in the
case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes will become due and payable without
further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or
Event of Default (except a Default or Event of Default relating to the
payment of principal or interest or premium, if any,) if it determines that
withholding notice is in their interest. The Holders of a majority in
aggregate principal amount of the Notes then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences under the Indenture except
a continuing Default or Event of Default in the payment of interest on, or
the principal of, or premium on, if any, the Notes. The Issuers are
required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Issuers are required upon becoming
aware of any Default or Event of Default, to deliver to the Trustee a
statement specifying such Default or Event of Default.
A1-7
(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 the Trustee.
(14) NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, will not have any liability for any obligations of the Company or any
of their subsidiaries or such Guarantor under the Notes, the Subsidiary
Guarantees or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability. The waiver and release are
part of the consideration for the issuance of the Notes.
(15) AUTHENTICATION. This Note will not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
(16) ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
(17) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Notes or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.
(18) NON-RECOURSE. Notwithstanding anything to the contrary set forth
in the Indenture, this Note, any Security Document or any other Note
Document, this Note and the Subsidiary Guarantees are non-recourse secured
obligations of the Company and Guarantors, respectively. The only recourse
a holder of the Notes will have with respect to the payment of principal
of, or interest or premium on, this Note (whether under the Indenture or
the Note, or pursuant to the Subsidiary Guarantees) will be enforcement of
its rights against Finance Corp. under the Indenture or against the
Collateral pursuant to the Security Documents.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
A1-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: (Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint
_________________________________________________________
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 face of this Note)
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.10 or 4.15 of the Indenture, check the appropriate box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you
elect to have purchased:
$______________
Date: _______________
Your Signature:______________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:______________________
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A1-10
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*
The following exchanges of a part of this Global Note for an interest in
another Global Note or for a Definitive Note, or exchanges of a part of another
Global Note or Definitive Note for an interest in this Global Note, have been
made:
Principal Amount
at maturity of this
Amount of decrease in Amount of increase in Global Note Signature of
Principal Amount Principal Amount following such authorized officer
at maturity of at maturity of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ---------------- ---------------- ------------- ---------
* This schedule should be included only if the Note is issued in global form.
A1-11
EXHIBIT A2
[Face of Regulation S Temporary Global Note]
________________________________________________________________________________
CUSIP/CINS ____________
Second Priority Senior Secured Floating Rate Notes due 2011
No. ___ $____________
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
CCFC FINANCE CORP.
promises to pay to [CEDE & CO.]
------------
or registered assigns,
the principal sum of ___________________________________________________________
Dollars on August 26, 2011.
Interest Payment Dates: February 26 and August 26
Record Dates: February 11 and August 11
CALPINE CONSTRUCTION FINANCE COMPANY, L.P.
CCFC FINANCE CORP.
By:__________________________________________
Name:
Title:
By:__________________________________________
Name:
Title:
Dated: August 14, 2003
This is one of the Notes referred to in the within-mentioned Indenture:
WILMINGTON TRUST FSB,
as Trustee
By:________________________________
Authorized Signatory
________________________________________________________________________________
A2-1
[Back of Regulation S Temporary Global Note]
Second Priority Senior Secured Floating Rate Notes due 2011
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE PAYMENT OF INTEREST HEREON.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED
IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) ("XXX"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE ""SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY THE INITIAL
INVESTOR, (1) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT, OR (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), AND (B) BY
SUBSEQUENT INVESTORS, AS SET FORTH IN (A) ABOVE, AND, IN ADDITION, TO AN
INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE
501 OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE
A2-2
SECURITIES ACT AND, IN THE CASE OF EACH OF CLAUSES (A) AND (B), IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER
JURISDICTIONS."
Capitalized terms used herein have the meanings assigned to them in the
Indenture referred to below unless otherwise indicated.
(1) INTEREST. Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), and CCFC Finance Corp., a Delaware
corporation, ("Finance Corp." and, together with the Company, the
"Issuers") each promises to pay interest on the principal amount of this
Note from August 14, 2003 until maturity. The interest rate on the Notes
will be reset semiannually at the Applicable Eurodollar Rate (as defined
below). The Company will pay interest semi-annually in arrears on February
26 and August 26 of each year, or if any such day is not a Business Day, on
the next succeeding Business Day (each, an "Interest Payment Date").
Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of
issuance; provided that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred
to on the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment Date;
provided, further, that the first Interest Payment Date shall be February
26, 2004. The Company will pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at a rate that is 1% per annum
in excess of the rate then in effect; it will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace
periods) from time to time on demand at the same rate to the extent lawful.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months
"Applicable Note Eurodollar Rate" means, for each interest period during
which any note is outstanding subsequent to the initial interest period, 850
basis points over the rate determined by the Company (notice of such rate to be
sent to the Trustee by the Company on the date of determination thereof) equal
to the greater of (x) 1.25% or (y) the applicable British Bankers' Association
LIBOR rate for deposits in U.S. dollars for a period of six months as reported
by any generally recognized financial information service as of 11:00 a.m.
(London time) two business days prior to the first day of such interest period;
provided that, if no such British Bankers' Association LIBOR rate is available
to the Company, the Applicable Note Eurodollar Rate for the relevant interest
period shall instead be the rate at which Xxxxxxx Xxxxx Credit Partners L.P. or
one of its affiliate banks offers to place deposits in U.S. dollars with
first-class banks in the London interbank market for a period of six months at
approximately 11:00 a.m. (London time) two business days prior to the first day
of such interest period, in amounts equal to $1.0 million. Notwithstanding the
foregoing, the Applicable Note Eurodollar Rate for the initial interest period
will be 9.75%.
Until this Regulation S Temporary Global Note is exchanged for one or more
Regulation S Permanent Global Notes, the Holder hereof shall not be entitled to
receive payments of interest hereon; until so exchanged in full, this Regulation
S Temporary Global Note shall in all other respects be entitled to the same
benefits as other Notes under the Indenture.
(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 the February 11 or August 11 immediately
preceding the Interest Payment Date, even if such Notes are canceled after
such record date and on or before such Interest Payment Date, except as
A2-3
provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes will be payable as to principal, premium, if any, and
interest at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest may be made by check mailed to the Holders at
their addresses set forth in the register of Holders; provided that payment
by wire transfer of immediately available funds will be required with
respect to principal of, interest on and, premium, if any, on, all Global
Notes and all other Notes the Holders of which will have provided wire
transfer instructions to the Company or the Paying Agent. Such payment will
be in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
(3) PAYING AGENT AND REGISTRAR. The Company, on behalf of itself and
Finance Corp., will maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent").
The Registrar will keep a register of the Notes and of their transfer and
exchange. The Issuers may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar
and the term "Paying Agent" includes any additional paying agent. The
Issuers may change any Paying Agent or Registrar without notice to any
Holder. The Company will notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. If the Issuers fail to
appoint or maintain another entity as Registrar or Paying Agent, the
Trustee shall act as such. The Company or any of its Subsidiaries may act
as Paying Agent or Registrar. The Issuers initially appoint The Depository
Trust Company ("DTC") to act as Depositary with respect to the Global
Notes. The Issuers initially appoint the Trustee to act as the Registrar
and Paying Agent and to act as Custodian with respect to the Global Notes.
(4) INDENTURE The Company issued the Notes under an Indenture dated as
of August 14, 2003 (the "Indenture") among the Issuers, the Guarantors and
the Trustee. The terms of the Notes include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture
Act of 1939, as amended (15 U.S. Code xx.xx. 77aaa-77bbbb). The Notes are
subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. To the extent any provision of this
Note conflicts with the express provisions of the Indenture, the provisions
of the Indenture shall govern and be controlling. The Notes are secured
obligations of the Company limited to $365.0 million in aggregate principal
amount. The Notes are secured on a second-priority basis, equally and
ratably with any future Parity Lien Debt by (i) a security interest in all
the assets of the Company other than Excluded Assets and (ii) a pledge of
the equity interests in the Company and its Subsidiaries (other than CCFC
Finance) and all intercompany notes for money owed to CCFC by any of its
Subsidiaries, subject to liens securing the Priority Lien Debt (including
the Term Loans), and other Permitted Liens.
(5) Optional Redemption.
(a) Except as set forth in subparagraph (b) of this Paragraph 5,
on or after August 26, 2009, the Issuers may redeem the Notes upon not
less than 30 nor more than 60 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus
accrued and unpaid interest thereon to the applicable redemption date,
if redeemed during the twelve-month period beginning on August 26 of
the years indicated below, subject to the rights of Holders on the
relevant record dates to receive interest on the relevant interest
payment date:
A2-4
Year Percentage
---- ----------
2009.......................................... 104.250%
2010 to February 25, 2011..................... 102.125%
February 26, 2011 and thereafter.................... 100.000%
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, the Issuers may redeem all or a part of the Notes at any
time prior to August 26, 2009, upon not less than 30 nor more than 60
days prior notice, at a redemption price equal to 100% of the
principal amount of the Notes redeemed plus the Applicable Premium as
of, and accrued and unpaid interest, if any, to, the redemption date,
subject to the rights of Holders on the relevant record date to
receive interest due on the relevant interest payment date.
(c) Except pursuant to the preceding paragraph, the Notes are not
redeemable at the Issuers' option prior to August 26, 2009.
(d) Any redemption pursuant to Section 3.07 of the Indenture
shall be made pursuant to Sections 3.01 through 3.06 thereof. Unless
the Issuers default in the payment of the redemption price, interest
will cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(6) Mandatory Redemption.
The Issuers will not be required to make mandatory redemption or sinking
fund payments with respect to the Notes.
(7) Repurchase at Option of Holder.
(a) If there is a Change of Control, the Issuers will make an
offer (a "Change of Control Offer") to each Holder to repurchase all
or any part (equal to $1,000 or an integral multiple thereof) of each
Holder's Notes at a purchase price equal to 101% of the aggregate
principal amount thereof plus accrued and unpaid interest on the Notes
purchased, if any, to, but excluding, the date of purchase (the
"Change of Control Payment"), subject to the rights of Holders on the
relevant record date to receive interest due on the relevant interest
payment date. Within 30 days following any Change of Control, the
Issuers will mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by Section 4.15 of
the Indenture.
(b) The Company and its Subsidiaries must use the Net Proceeds
from any Asset Sale (including a Designated Asset Disposition),
Casualty Event or Condemnation Event that remain after any required
application of such Net Proceeds to the repayment of Priority Lien
Obligations to make an "Asset Sale Offer" to all holders of Notes and
all holders of other Parity Lien Obligations containing provisions
similar to those set forth in the Indenture with respect to offers to
purchase, repay or redeem with the proceeds of sales of assets, the
maximum principal amount of notes and such other Parity Lien
Obligations that may be purchased, repaid or redeemed out of such Net
Proceeds. The offer price in any Asset Sale Offer will be equal to
100% of principal amount plus accrued and unpaid interest to the date
of purchase, and will be payable in cash. If any of such Net Proceeds
remain after consummation of an Asset Sale Offer, the Company and its
Subsidiaries may use those excess Net Proceeds for any purpose not
otherwise prohibited by the Indenture, including the making of
Restricted Payments in accordance with the covenant described in
Section 4.07 thereof. If the aggregate principal amount of notes and
other Parity Lien Obligations tendered into such Asset Sale Offer
exceeds the amount of such excess
A2-5
Net Proceeds, the Issuers will select the notes and such other Parity
Lien Obligations to be purchased on a pro rata basis.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000, unless all of the Notes held by a Holder are to be
redeemed. On and after the redemption date interest ceases to accrue on
Notes or portions thereof called for redemption.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered
form without coupons in denominations of $1,000 and integral multiples
thereof. The transfer of Notes may be registered and Notes may be exchanged
as provided in the Indenture. The Registrar and the Trustee may require a
Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes
and fees required by law or permitted by the Indenture. The Company need
not exchange or register the transfer of any Note or portion of a Note
selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or in part
for one or more Global Notes only (i) on or after the termination of the 40-day
restricted period (as defined in Regulation S) and (ii) upon presentation of
certificates (accompanied by an Opinion of Counsel, if applicable) required by
Article 2 of the Indenture. Upon exchange of this Regulation S Temporary Global
Note for one or more Global Notes, the Trustee shall cancel this Regulation S
Temporary Global Note.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture, the Subsidiary Guarantees or the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
aggregate principal amount of the Notes then outstanding (including
consents obtained in connection with a purchase or tender offer or exchange
offer for Notes) voting as a single class, and any existing default or
compliance with any provision of the Indenture, the Subsidiary Guarantees
or the Notes may be waived with the consent of the Holders of a majority in
principal amount of the Notes then outstanding (including consents obtained
in connection with a purchase or tender offer or exchange offer for Notes)
voting as a single class. Without the consent of any Holder of a Note, the
Indenture, the Subsidiary Guarantees or the Notes may be amended or
supplemented to cure any ambiguity, defect or inconsistency, to provide for
uncertificated Notes in addition to or in place of certificated Notes, to
provide for the assumption of the Company's or any Guarantor's obligations
to Holders of the Notes in case of a merger or consolidation, to make any
change that would provide any additional rights or benefits to the Holders
of the Notes or that does not adversely affect the legal rights under the
Indenture of any such Holder, to comply with the requirements of the SEC in
order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act, to make, complete or confirm any grant of Collateral
permitted or required by the Indenture or any of the Security Documents or
any release of Collateral that becomes effective as set forth in the
Indenture or any of the Security Documents, to conform the text of the
Indenture, the Subsidiary Guarantees, the Security Documents or the notes
to any provision of the Description of Notes in the Offering Circular to
the extent that such provision in the Description of Notes in
A2-6
the Offering Circular was intended to be a verbatim recitation of a
provision of the Indenture, the Subsidiary Guarantees, the Security
Documents or the notes, to reflect any waiver or termination of any right
arising under the provisions of the Indenture that otherwise would be
enforceable by any holder of a Term Loan Obligation, if such waiver or
termination is set forth in the agreement governing such Term Loan
Obligation, provided that no such waiver or amendment shall adversely
affect the rights of Holders of Notes, to provide for the issuance of
Additional Notes in accordance with the limitations set forth in the
Indenture as of the date hereof, or to allow any Guarantor to execute a
supplemental indenture and/or a Note Guarantee with respect to the Notes.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i) default for
30 days in the payment when due of interest on the Notes; (ii) default in
payment when due of the principal of or premium, if any, on the Notes when
the same becomes due and payable at maturity, upon redemption (including in
connection with an offer to purchase) or otherwise, (iii) failure by the
Company to comply with Section 4.10, the fifth paragraph of Section 4.13,
4.15, 4.20 or 5.01 of the Indenture; (iv) failure by the Company or any of
its Subsidiaries to observe or perform any other covenant, representation,
warranty or other agreement in the Indenture, or the Security Documents for
30 days after notice to the Company by the Trustee or the Holders of at
least 25% in aggregate principal amount of the Notes then outstanding
voting as a single class; (v) default under certain other agreements
relating to Indebtedness of the Company which default is caused by the
failure to pay principal of, or interest or premium, if any, on such
Indebtedness or, results in the acceleration of such Indebtedness prior to
its express maturity; (vi) certain final judgments for the payment of money
that remain undischarged for a period of 30 days, provided the aggregate of
such judgments exceeds $5.0 million; (vii) certain events of bankruptcy or
insolvency with respect to the Company or any of its Subsidiaries; (viii)
the repudiation of certain covenants in the Security Documents or the
enforceability of the Security Documents under certain circumstances; (ix)
except as permitted by the Indenture, any Subsidiary Guarantee shall be
held in any judicial proceeding to be unenforceable or invalid or shall
cease for any reason to be in full force and effect or any Guarantor or any
Person acting on its behalf shall deny or disaffirm its obligations under
such Guarantor's Subsidiary Guarantee; and (x) the breach by any Person
(other than the Company and its Subsidiaries) of its obligations under, or
the termination or failure to be in full force of, a Major Project
Document, unless such breach when taken together with all such breaches
would be materially adverse to Holders. If any Event of Default occurs and
is continuing, the Trustee or the Holders of at least 25% in aggregate
principal amount of the then outstanding Notes may declare all the Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event
of Default arising from certain events of bankruptcy or insolvency, all
outstanding Notes will become due and payable without further action or
notice. Holders may not enforce the Indenture or the Notes except as
provided in the Indenture. Subject to certain limitations, Holders of a
majority in principal amount of the then outstanding Notes may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest or premium, if any) if it determines that withholding
notice is in their interest. The Holders of a majority in aggregate
principal amount of the Notes then outstanding by notice to the Trustee may
on behalf of the Holders of all of the Notes waive any existing Default or
Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of interest on, or
the principal of or premium on, if any, the Notes. The Issuers are required
to deliver to the Trustee annually a statement regarding compliance with
the Indenture, and the Issuers are required upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.
A2-7
(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 the Trustee.
(14) NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, will not have any liability for any obligations of the Company or any
of their subsidiaries or such Guarantor under the Notes, the Subsidiary
Guarantees or the Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability. The waiver and release are
part of the consideration for the issuance of the Notes.
(15) AUTHENTICATION. This Note will not be valid until authenticated
by the manual signature of the Trustee or an authenticating agent.
(16) ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
(17) CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes and the Trustee may use
CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Notes or as contained in any notice of redemption and reliance may
be placed only on the other identification numbers placed thereon.
(18) NON-RECOURSE. Notwithstanding anything to the contrary set forth
in the Indenture, this Note, any Security Document or any other Note
Document, this Note and the Subsidiary Guarantees are non-recourse secured
obligations of the Company and Guarantors, respectively. The only recourse
a holder of the Notes will have with respect to the payment of principal
of, or interest or premium on, this Note (whether under the Indenture or
the Note, or pursuant to the Subsidiary Guarantees) will be enforcement of
its rights against Finance Corp. under the Indenture or against the
Collateral pursuant to the Security Documents.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Attention: Chief Financial Officer
A2-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to:___________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
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 face of this Note)
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A2-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant to
Section 4.10 or 4.15 of the Indenture, check the appropriate box below:
[ ] Section 4.10 [ ] Section 4.15
If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.10 or Section 4.15 of the Indenture, state the amount you
elect to have purchased:
$_______________
Date: _______________
Your Signature:______________________________
(Sign exactly as your name appears on the face of this Note)
Tax Identification No.:______________________
Signature Guarantee*: _________________________
* Participant in a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
A2-10
SCHEDULE OF EXCHANGES OF REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary Global
Note for an interest in another Global Note, or of other Restricted Global Notes
for an interest in this Regulation S Temporary Global Note, have been made:
Principal Amount
at maturity of this
Amount of decrease Amount of increase in Global Note Signature of
in Principal Amount Principal Amount following such authorized officer
at maturity of at maturity of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ---------------- ---------------- ------------- ---------
A2-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Wilmington Trust FSB
c/o Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxxxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Re: Second Priority Senior Secured Floating Rate Notes due 2011
Reference is hereby made to the Indenture, dated as of August 14, 2003 (the
"Indenture"), among Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), CCFC Finance Corp., a Delaware corporation
("Finance Corp." and, together with the Company, the "Issuers"), the Guarantors
named on the signature pages thereto and Wilmington Trust FSB, 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
Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the "Transfer"),
to ___________________________ (the "Transferee"), as further specified in Annex
A hereto. In connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] Check if Transferee will take delivery of a beneficial interest in
the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is
being effected pursuant to and in accordance with Rule 144A under the Securities
Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor
hereby further certifies that the beneficial interest or Definitive Note is
being transferred to a Person that the Transferor reasonably believed and
believes is purchasing the beneficial interest or Definitive Note 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 beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note and/or the Definitive Note and in the
Indenture and the Securities Act.
2. [ ] Check if Transferee will take delivery of a beneficial interest in
the Temporary Regulation S Global Note, the Regulation S Global Note or a
Definitive Note pursuant to Regulation S. The Transfer is being effected
pursuant to and in accordance with Rule 903 or 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
B-1
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 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the
transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made prior to the expiration of the Restricted Period, the transfer is not being
made to a U.S. Person or for the account or benefit of a U.S. Person (other than
an Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on Transfer enumerated in
the Private Placement Legend printed on the Regulation S Global Note, the
Temporary Regulation S Global Note and/or the Definitive Note and in the
Indenture and the Securities Act.
3. [ ] Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Note or a Definitive Note pursuant to any provision
of the Securities Act other than Rule 144A or Regulation S. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Notes and Restricted Definitive Notes
and pursuant to and in accordance with the Securities Act and any applicable
blue sky securities laws of any state of the United States, and accordingly the
Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) [ ] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the
Transferor hereby further certifies that it has not engaged in any general
solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Note or Restricted Definitive
Notes and the requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee in the form of
Exhibit D to the Indenture and (2) if such Transfer is in respect of a
principal amount of Notes at the time of transfer of less than $250,000, an
Opinion of Counsel provided by the Transferor or the Transferee (a copy of
which the Transferor has attached to this certification), to the effect
that such Transfer is in compliance with the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the IAI Global Note and/or the Definitive Notes and in
the Indenture and the Securities Act.
B-2
4. [ ] Check if Transferee will take delivery of a beneficial interest in
an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) [ ] Check if Transfer is pursuant to Rule 144. (i) 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 any applicable blue sky securities laws of any state
of the United States and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement 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 beneficial interest or Definitive Note will no longer be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Notes, on Restricted Definitive
Notes and in the Indenture.
(b) [ ] Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or
Rule 904 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture and any applicable blue sky
securities laws of any state of the United States and (ii) the restrictions
on transfer contained in the Indenture and the Private Placement 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 beneficial interest or Definitive Note will no
longer be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(c) [ ] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule
144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of
any State of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement 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 beneficial interest or Definitive Note will not
be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
_____________________________________________
[Insert Name of Transferor]
By:__________________________________________
Name:
Title:
Dated: _______________________
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(iv) Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Wilmington Trust FSB
c/o Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxxxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-00000
Re: Second Priority Senior Secured Floating Rate Notes due 2011
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of August 14, 2003 (the
"Indenture"), among Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), CCFC Finance Corp., a Delaware corporation
("Finance Corp." and, together with the Company, the "Issuers"), the Guarantors
named on the signature pages thereto and Wilmington Trust FSB, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
__________________________, (the "Owner") owns and proposes to exchange the
Note[s] or interest in such Note[s] specified herein, in the principal amount of
$____________ in such Note[s] or interests (the "Exchange"). In connection with
the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial Interests in a
Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests
in an Unrestricted Global Note
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to beneficial interest in an Unrestricted Global Note. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a beneficial interest in an Unrestricted Global Note in an equal principal
amount, the Owner hereby certifies (i) the beneficial interest is being acquired
for the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to the Global
Notes and pursuant to and in accordance with the Securities Act of 1933, as
amended (the "Securities Act"), (iii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(b) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Unrestricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for an Unrestricted
Definitive Note, the Owner hereby certifies (i) the Definitive Note is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Restricted Global Notes and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
C-1
the Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United States.
(c) [ ] Check if Exchange is from Restricted Definitive Note to beneficial
interest in an Unrestricted Global Note. In connection with the Owner's Exchange
of a Restricted Definitive Note for a beneficial interest in an Unrestricted
Global Note, the Owner hereby certifies (i) the beneficial interest is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests
in Restricted Global Notes
(a) [ ] Check if Exchange is from beneficial interest in a Restricted
Global Note to Restricted Definitive Note. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies that
the Restricted Definitive Note is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance with
the terms of the Indenture, the Restricted Definitive Note issued will continue
to be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Definitive Note and in the Indenture
and the Securities Act.
(b) [ ] Check if Exchange is from Restricted Definitive Note to beneficial
interest in a Restricted Global Note. In connection with the Exchange of the
Owner's Restricted Definitive Note for a beneficial interest in the [CHECK ONE]
144A Global Note, Regulation S Global Note, IAI Global Note with an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance with
the Securities Act, and in compliance with any applicable blue sky securities
laws of any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the beneficial interest
issued will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the relevant Restricted Global Note and in the
Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
__________________________________________
[Insert Name of Transferor]
By:_______________________________________
Name:
Title:
Dated: ______________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Calpine Construction Finance Company, L.P.
CCFC Finance Corp.
00 Xxxx Xxx Xxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxxxxxxxxx 00000
Telecopier No.: (000) 000-0000
Wilmington Trust FSB
c/o Wilmington Trust Company
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx Xxxxxx Xxxxx
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Re: Second Priority Senior Secured Floating Rate Notes due 2011
Reference is hereby made to the Indenture, dated as of August 14, 2003
(the "Indenture"), among Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), CCFC Finance Corp., a Delaware corporation
("Finance Corp." and, together with the Company, the "Issuers"), the Guarantors
named on the signature pages thereto and Wilmington Trust FSB, as trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any interest
therein is subject to certain restrictions and conditions set forth in the
Indenture and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Notes or any interest therein except in compliance
with, such restrictions and conditions and the Securities Act of 1933, as
amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any accounts for which we are acting
as hereinafter stated, that if we should sell the Notes or any interest therein,
we will do so only (A) to the Company or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) to an institutional "accredited investor" (as
defined below) that, prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and, if such transfer is in respect of
a principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
D-1
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or beneficial
interest therein, we will be required to furnish to you and the Company such
certifications, legal opinions and other information as you and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes or beneficial interest therein purchased by
us for our own account or for one or more accounts (each of which is an
institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
________________________________________
[Insert Name of Accredited Investor]
By:_____________________________________
Name:
Title:
Dated: _______________________
D-2
EXHIBIT E
[FORM OF NOTATION OF SUBSIDIARY GUARANTEE]
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, on a non-recourse basis to the extent set forth in the Indenture and
subject to the provisions in the Indenture dated as of August 14, 2003 (the
"Indenture") among Calpine Construction Finance Company, L.P., a Delaware
limited partnership (the "Company"), CCFC Finance Corp., a Delaware corporation
("Finance Corp." and, together with the Company, the "Issuers"), the Guarantors
listed on Schedule I thereto and Wilmington Trust FSB, as trustee (the
"Trustee"), (a) the due and prompt payment of the principal of, premium, if any,
and interest on the Notes (as defined in the Indenture), whether at maturity, by
acceleration, redemption or otherwise, the due and prompt payment of interest on
overdue principal of and interest on the Notes, if any, if lawful, and the due
and punctual performance of all other obligations of the Company to the Holders
or the Trustee all in accordance with the terms of the Indenture and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors to the
Holders of Notes and to the Trustee pursuant to the Subsidiary Guarantee and the
Indenture are expressly set forth in Article 11 of the Indenture and reference
is hereby made to the Indenture for the precise terms of the Subsidiary
Guarantee.
[NAME OF GUARANTOR(S)]
By:_____________________________________
Name:
Title:
E-1
EXHIBIT F
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, 200__, among __________________ (the "Guaranteeing
Subsidiary"), a subsidiary of ____________________ (or its permitted successor),
a [Delaware] corporation (the "Company"), the Issuers, the other Guarantors (as
defined in the Indenture referred to herein) and Wilmington Trust FSB, as
trustee under the indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Issuers have heretofore executed and delivered to the Trustee
an indenture (the "Indenture"), dated as of August 14, 2003 providing for the
issuance of an aggregate principal amount of up to $365,000,000 of Second
Priority Senior Secured Floating Rate Notes due 2011 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental
indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally
guarantee all of the Company's Obligations under the Notes and the Indenture on
the terms and conditions set forth herein (the "Subsidiary Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary ereby agrees as
follows:
(a) Subject to the limitations set forth in Section 6, along with
all Guarantors named in the Indenture, to jointly and severally
Guarantee to each Holder of a Note authenticated and delivered by the
Trustee and to the Trustee and its successors and assigns, the Notes
or the obligations of the Company hereunder or thereunder, that:
(i) the principal of, and premium, if any, and interest on the
Notes will be promptly paid in full when due, whether at maturity, by
acceleration, redemption or otherwise, and interest on the overdue
principal of and interest on the Notes, if any, if lawful, and all
other obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or performed,
all in accordance with the terms hereof and thereof; and
(ii) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors shall be
jointly and severally obligated to pay the same immediately.
F-1
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the
Notes or the Indenture, the absence of any action to enforce the same,
any waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor.
(c) The following is hereby waived: diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands
whatsoever.
(d) This Subsidiary Guarantee shall not be discharged except by
complete performance of the obligations contained in the Notes and the
Indenture, and the Guaranteeing Subsidiary accepts all obligations of
a Guarantor under the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any custodian,
trustee, liquidator or other similar official acting in relation to
either the Company or the Guarantors, any amount paid by either to the
Trustee or such Holder, this Subsidiary Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the Holders
and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in
Article 6 of the Indenture for the purposes of this Subsidiary
Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed
hereby, and (y) in the event of any declaration of acceleration of
such obligations as provided in Article 6 of the Indenture, such
obligations (whether or not due and payable) shall forthwith become
due and payable by the Guarantors for the purpose of this Subsidiary
Guarantee.
(h) The Guarantors shall have the right to seek contribution from
any non-paying Guarantor so long as the exercise of such right does
not impair the rights of the Holders under the Subsidiary Guarantee.
(i) Pursuant to Section 11.02 of the Indenture, after giving
effect to any maximum amount and all other contingent and fixed
liabilities that are relevant under any applicable Bankruptcy or
fraudulent conveyance laws, and after giving effect to any collections
from, rights to receive contribution from or payments made by or on
behalf of any other Guarantor in respect of the obligations of such
other Guarantor under Article 11 of the Indenture, this new Subsidiary
Guarantee shall be limited to the maximum amount permissible such that
the obligations of such Guarantor under this Subsidiary Guarantee will
not constitute a fraudulent transfer or conveyance.
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Subsidiary Guarantees shall remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Subsidiary Guarantee.
F-2
4. GUARANTEEING SUBSIDIARY mAY CONSOLIDATE, eTC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not sell or otherwise dispose
of all substantially all of its assets to, or consolidate with or
merge with or into (whether or not such Guarantor is the surviving
Person) another Person, other than the Company or another Guarantor
except as permitted by Section 4.10 of the Indenture.
(b) In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in
form to the Trustee, of the Subsidiary Guarantee endorsed upon the
Notes and the due and punctual performance of all of the covenants and
conditions of the Indenture to be performed by the Guarantor, such
successor Person shall succeed to and be substituted for the Guarantor
with the same effect as if it had been named herein as a Guarantor.
Such successor Person thereupon may cause to be signed any or all of
the Subsidiary Guarantees to be endorsed upon all of the Notes
issuable under the Indenture which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank
and benefit under the Indenture as the Subsidiary Guarantees
theretofore and thereafter issued in accordance with the terms of the
Indenture as though all of such Subsidiary Guarantees had been issued
at the date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in the
Indenture or in any of the Notes shall prevent any consolidation or
merger of a Guarantor with or into the Company or another Guarantor,
or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety to the Company or
another Guarantor.
5. RELEASES.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of
the capital stock of any Guarantor, in each case to a Person that is
not (either before or after giving effect to such transaction) a
Subsidiary of the Company, then such Guarantor (in the event of a sale
or other disposition, by way of merger, consolidation or otherwise, of
all of the capital stock of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other disposition of
all or substantially all of the assets of such Guarantor) will be
released and relieved of any obligations under its Subsidiary
Guarantee; provided that the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions
of the Indenture, including without limitation Section 4.10 of the
Indenture. Upon delivery by the Company to the Trustee of an Officers'
Certificate and an Opinion of Counsel to the effect that such sale or
other disposition was made by the Company in accordance with the
provisions of the Indenture, including without limitation Section 4.10
of the Indenture, the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from its
obligations under its Subsidiary Guarantee.
(b) Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of
principal of and interest on the Notes
F-3
and for the other obligations of any Guarantor under the Indenture as
provided in Article 11 of the Indenture.
6. NO RECOURSE AGAINST OTHERS. This Subsidiary Guarantee is a non-
recourse secured obligation of the Subsidiary Guarantor. The only recourse a
holder of Notes will have under the Subsidiary Guarantee is enforcement of its
rights against the Collateral securing the Subsidiary Guarantee pursuant to the
Security Documents. No past, present or future director, officer, employee,
incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such,
shall have any liability for any obligations of the Company or any Guaranteeing
Subsidiary under the Notes, any Subsidiary Guarantees, the Indenture or this
Supplemental Indenture or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of the Notes by accepting a
Note waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the Notes. Such waiver may not be effective to
waive liabilities under the federal securities laws and it is the view of the
SEC that such a waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
8. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Supplemental
Indenture or for or in respect of the recitals contained herein, all of which
recitals are made solely by the Guaranteeing Subsidiary and the Company.
F-4
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, 20___
[GUARANTEEING SUBSIDIARY]
By: _______________________________
Name:
Title:
[COMPANY]
By: _______________________________
Name:
Title:
[EXISTING GUARANTORS]
By: _______________________________
Name:
Title:
[TRUSTEE],
as Trustee
By: _______________________________
Authorized Signatory
F-5
EXHIBIT G
[FORMS OF SUBORDINATION]
SEE ATTACHMENT A AND
ARTICLE VII OF ATTACHMENT B
G-1
ATTACHMENT A
FORM OF SUBORDINATION AGREEMENT
G-2
ATTACHMENT B
WORKING CAPITAL FACILITY
G-3
SCHEDULE A
MORTGAGES AND DEEDS OF TRUST
1. Mortgage, Assignment of Rents, Security Agreement and Fixture Filing, dated
as of the date hereof, by the Company in favor of the Collateral Agent
2. Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing,
dated as of the date hereof, by the Company to Xxxxxxx Title Company, as
trustee, for the benefit of the Collateral Agent
3. Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing,
dated as of the date hereof, by the Company to Xxxxxxx X. Xxxxxx, as
trustee, for the benefit of the Collateral Agent
4. Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing,
dated as of the date hereof, by Hermiston Power Partnership to First
American Title Insurance Company, as trustee, for the benefit of the
Collateral Agent
5. Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing,
dated as of the date hereof, by the Company to Xxxxxxx X. Xxxxxx, as
trustee, for the benefit of the Collateral Agent
6. Open End Mortgage, Assignment of Rents, Security Agreement and Fixture
Filing, dated as of the date hereof, by the Company in favor of the
Collateral Agent
7. Mortgage, Assignment of Rents, Security Agreement and Fixture Filing, dated
as of the date hereof, by the Company in favor of the Collateral Agent
