Exhibit 10.8
EXHIBIT A
FORM OF
SERIES A % SUBORDINATED DEBENTURE
DUE , 2040
No. 1 CUSIP NO.
THE INDEBTEDNESS EVIDENCED BY THIS SECURITY IS, TO THE EXTENT PROVIDED IN THE
INDENTURE, SUBORDINATE AND SUBJECT IN RIGHT OF PAYMENT TO THE PRIOR PAYMENT IN
FULL OF ALL SENIOR INDEBTEDNESS AND THIS SECURITY IS ISSUED SUBJECT TO THE
PROVISIONS OF THE INDENTURE WITH RESPECT THERETO.
SEMCO ENERGY, INC. SERIES A % SUBORDINATED DEBENTURE DUE
Principal Amount: $
Regular Record Date: 15th calendar day prior to Interest Payment Date
Original Issue Date: , 2000
Stated Maturity: , 2040
Interest Payment Dates: , , ,
Interest Rate: % per annum % per annum
Authorized Denomination: $25
Initial Redemption Date: , 2005
SEMCO Energy, Inc., a Michigan corporation (the "Corporation", which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to, or registered
assigns, the principal sum of ___________ DOLLARS ($) on the Stated Maturity
shown above (or upon earlier redemption), and to pay interest thereon from the
Original Issue Date shown above, or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, quarterly in arrears on
each Interest Payment Date as specified above, commencing on the Interest
Payment Date next succeeding the Original Issue Date shown above and on the
Stated Maturity (or upon earlier redemption) at the rate per annum shown above
(the "Interest Rate") until the principal hereof is paid or made available for
Payment and on any overdue principal and on any overdue installment of interest.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date (other than an Interest Payment Date that is the Stated
Maturity or on a Redemption Date) will, as provided in such Indenture, be paid
to the Person in whose name this Series A ___% Subordinated Debenture (this
"Security") is registered at the close of business on the Regular Record Date as
specified above next preceding such Interest Payment Date; provided that any
interest payable at Stated Maturity or on any Redemption Date will be paid to
the Person to whom principal is payable. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice thereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record
Date, or be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities of this
series shall be listed and upon such notice as may be required by any such
exchange, all as more fully provided in said Indenture.
Payments of interest on this Security will include interest accrued to but
excluding the respective Interest Payment Dates. Interest payments for this
Security shall be computed and paid on the basis of a 360-day year of twelve
30-day months. In the event that any date on which interest is payable on this
Security is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or payment in respect of any such delay), except that, if such
Business Day is in the next succeeding calendar year, payment shall be made on
the immediately preceding Business Day, in each case with the same force and
effect as if made on the date the payment was originally payable. "Business Day"
means a day other than (i) a Saturday or a Sunday, (ii) a day on which banks in
New York, New York are authorized or obligated by law or executive order to
remain closed or (iii) a day on which the Corporate Trust Office or the
principal corporate trust office of the Property Trustee is closed for
business.
The Corporation shall have the right at any time and from time to time
during the term of this Security to extend the interest payment period of such
Security for up to 20 consecutive quarters (each, an "Extension Period"), but
not beyond the Stated Maturity of this Security, during which Extension Periods
interest shall accrue on unpaid installments of interest at the Interest Rate,
compounded quarterly, to the date of payment to the extent permitted by
applicable law (such unpaid interest plus such interest thereon being called
"Deferred Interest"); provided, however, that the Corporation shall have the
right to make partial payments of interest on any Interest Payment Date during
any Extension Period. Upon the termination of each Extension Period, which shall
be on an Interest Payment Date, the Corporation shall pay all Deferred Interest
on the next succeeding Interest Payment Date to the Person in whose name this
Security is registered at the close of business on the Regular Record Date for
such Interest Payment Date; provided that any Deferred Interest payable at
Stated Maturity or on any Redemption Date will be paid to the Person to whom
principal is payable. Prior to the termination of any such Extension Period, the
Corporation may further extend the interest payment period; provided that such
Extension Period together with all such previous and further extensions thereof
shall not exceed twenty (20) consecutive quarters. Upon the termination of any
such Extension Period, and the payment of all accrued and unpaid interest
(including any Additional Interest) then due, the Corporation may select a new
Extension Period, subject to the above requirements. The Corporation shall not
(i) declare or pay any dividend or distribution on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of its capital stock, and
(ii) make any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt securities (including guarantees other than the
Guarantee) issued by the Corporation that rank pari passu with or junior to this
Security if the Corporation shall have given notice of its election to extend an
interest payment period for this Security and such extension shall be continuing
or if at such time an Event of Default with respect to the series of which this
Security is a part shall have occurred and be continuing. The preceding
sentence, however, shall not restrict (A) any of the actions described in the
preceding sentence resulting from any reclassification of the Corporation's
capital stock or the exchange or conversion of one class or series of the
Corporation's capital stock for another class or series of the Corporation's
capital stock, (B) repurchases, redemptions or other acquisitions of shares of
the Corporation's capital stock in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of employees,
officers or directors or a stock purchase and dividend reinvestment plan, (C)
dividends or distributions on capital stock of the Corporation, or (D) the
purchase of fractional interests in shares of the Corporation's capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged. The Corporation shall give the Holder of
this Security and the Trustee notice of its selection or extension of an
Extension Period at least one Business Day prior to the earlier of (i) the
Regular Record Date relating to the Interest Payment Date on which the Extension
Period is to commence or relating to the Interest Payment Date on which an
Extension Period that is being extended would otherwise terminate or (ii) the
date the Corporation or the Securities Trust is required to give notice to the
New York Stock Exchange or other applicable self-regulatory organization of the
record date or the date such distributions are payable.
The Corporation also shall be obligated to pay when due and without
extension all additional amounts as may be required so that the net amount
received and retained by the Holder of this Security (if the Holder is the
Securities Trust) after paying taxes, duties, assessments or governmental
charges of whatever nature (other than withholding taxes) imposed by the United
States or any other taxing authority will not be less than the amounts such
Holder would have received had no such taxes, duties, assessments, or other
governmental charges been imposed.
Payment of the principal of and interest (including Additional Interest, if
any) due at the Stated Maturity or earlier redemption of this Security shall be
made upon surrender of this Security, at the office of the Paying Agent, 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. Payment of interest
(including interest on an Interest Payment Date) will be made, subject to such
surrender where applicable, at the option of the Corporation, (i) by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or (ii) by wire transfer at such place and to
such account at a banking institution in the United States as may be designated
in writing to the Trustee at least thirty (30) days prior to the date for
payment by the Person entitled thereto.
The indebtedness evidenced by this Security is, to the extent and in the
manner set forth in the Indenture, subordinate in right of payment to the prior
payment in full of all Senior Indebtedness (as defined in the Indenture), and
this Security is issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate the
subordination so provided, and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes. Each Holder hereof, by his acceptance hereof, waives
all notice of the acceptance of the Subordination provisions contained herein
and in the Indenture by each holder of Senior Indebtedness whether now
outstanding or hereafter incurred and waives reliance by each such holder upon
said provisions.
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REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES
HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
Dated:
SEMCO ENERGY, INC.,
By: _____________________________
Its: ______________________________
Attest: _______________________________
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
Bank One Trust Company,
National Association
By: _____________________________
Authorized Officer
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(Reverse Side of Security)
This Security is one of a duly authorized issue of Securities of the
Corporation (the "Securities"), issued and issuable in one or more series under
a Subordinated Indenture, dated as of , , as supplemented (the
"Indenture"), between the Corporation and Bank One Trust Company, National
Association, as Trustee (the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitation of rights, duties and immunities thereunder of the Corporation, the
Trustee and the Holders of the Securities issued thereunder and of the terms
upon which said Securities are, and are to be, authenticated and delivered. This
Security is one of the series designated on the face hereof as Series A %
Subordinated Debentures due ___________ (the "Series A Debentures") in the
aggregate principal amount of up to $ . Capitalized terms used herein for
which no definition is provided, herein shall have the meanings set forth in the
Indenture.
The Corporation shall have the right, subject to the terms and conditions
of the Indenture, to redeem this Security at any time on or after at the option
of the Corporation, without premium or penalty; in whole or in part, at a
Redemption Price equal to % of the principal amount to be redeemed plus
accrued but unpaid interest (including any Additional Interest) to the
Redemption Date. Upon the occurrence of a Special Event (as defined below), the
Corporation may, within 90 days following the occurrence thereof and subject to
the terms and conditions of the Indenture, redeem this Security without premium
or penalty, in whole, at a Redemption Price equal to % of the principal
amount thereof plus accrued but unpaid interest (including any Additional
Interest) to the Redemption Date. A Special Event may be a Tax Event or an
Investment Company Act Event. "Tax Event" means that the Administrative Trustees
and the Corporation shall have received an opinion of Counsel experienced in
such matters to the effect that, as a result of (a) any amendment to, or change
(including any announced prospective change) in, laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein or (b) any amendment to, or change in, an
interpretation or application of such laws or regulations, there is more than an
insubstantial risk that (i) the Securities Trust would be subject to United
States federal income tax with respect to income accrued or receives on the
Series A Debentures, (ii) interest payable on the Series A Debentures would not
be deductible by the Corporation for United States federal income tax purposes,
or (iii) the Securities Trust would be subject to more than a de minimis amount
of other taxes, duties or other governmental charges, which change or amendment
becomes effective on or after the Original Issue Date. "Investment Company Act
Event" means that the Administrative Trustees and the Corporation shall have
received an opinion of Counsel experienced in such matters to the effect that,
as a result of the occurrence of a change in law or regulation or a written
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority, there is more than an
insubstantial risk that the Securities Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act of 1940, as amended, which change becomes effective on or after the
Original Issue Date.
In the event of redemption of this Security in part only, a new Security or
Securities of this series for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the surrender hereof. The Securities of this
series will not have a sinking fund.
If an Event of Default with respect to the Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the Holders of the Securities of all series
affected under the Indenture at any time by the Corporation and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Outstanding Securities of all series affected thereby (voting as one class).
The Indenture contains provisions permitting the Holders of not less than a
majority in principal amount of the Outstanding Securities of all series with
respect to which a default under the Indenture shall have occurred and be
continuing (voting as one class), on behalf of the Holders of the Securities of
all such series, to waive, with certain exceptions, such default under the
Indenture and its consequences. The Indenture also permits the Holders of not
less than a majority in principal amount of the Securities of each series at the
time outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Corporation with certain provisions of the Indenture
affecting such series. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
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No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Corporation, which
is absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation for such purpose, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Corporation and the
Security Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series,
of authorized denominations and of like tenor an for the same aggregate
principal amount, will be issued to the designated transferee or transferees. No
service charge shall be made for any such registration of transfer or exchange,
but the Corporation may require payment of a sum sufficient to cover any tax or
other governmental charge payable In connection therewith.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
resect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than a majority in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and of offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request and shall have failed to institute any such
proceeding for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal hereof or any
interest hereon on or after the respective due dates expressed herein.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Securities of this series upon compliance with certain
conditions set forth in the Indenture.
Prior to due presentment of this Security for registration of transfer the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities of this series are issuable only in registered form without
coupons in denominations of $25 and any integral multiple thereof. As provided
in the Indenture and subject to the limitations therein set forth, Securities of
this series are exchangeable for a like aggregate principal amount of Securities
of this series of a different authorized denomination, as requested by the
Holder surrendering the same upon surrender of the Security or Securities to be
exchanged at the office or agency of the Corporation.
This Security shall be governed by, and construed in accordance with, the
internal laws of the State of New York.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - As tenants in common UNI GIFT MIN ACT -
TEN ENT - As tenants by the entireties Custodian (Cust)
------
(Minor)
JT TEN - As joint tenants with rights of Under Uniform Gifts
survivorship and not as tenants in To Minors Act (State)
common
Additional abbreviations may also be used though not on the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
(please insert Social Security or other identifying number of assignee).
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PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
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the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
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agent to transfer said Security on the books of the Corporation, with full power
of substitution in the premises.
Dated: ____________________________
__________________________________________
NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the within instrument in every
particular without alteration or enlargement, or any change whatever.
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