====================================
FIRST SUPPLEMENTAL INDENTURE
between
SIERRA PACIFIC POWER COMPANY
and
IBJ Schroder Bank & Trust Company
Dated as of July 24, 1996
====================================
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
SECTION 1.1. Definition of Terms. . . . . . . . . . . . . . . . . . . 2
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.1. Designation and Principal Amount . . . . . . . . . . . . 3
SECTION 2.2. Maturity . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.3. Form and Payment . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.4. Global Debenture . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.5. Interest . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE III
REDEMPTION OF THE DEBENTURES
SECTION 3.1. Special Event Redemption . . . . . . . . . . . . . . . . 7
SECTION 3.2. Optional Redemption by Company . . . . . . . . . . . . . 7
SECTION 3.3. No Sinking Fund. . . . . . . . . . . . . . . . . . . . . 8
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1. Extension of Interest Payment Period . . . . . . . . . . 8
SECTION 4.2. Notice of Extension. . . . . . . . . . . . . . . . . . . 9
SECTION 4.3. Limitation of Transactions . . . . . . . . . . . . . . . . 9
ARTICLE V
EXPENSES
SECTION 5.1. Payment of Expenses. . . . . . . . . . . . . . . . . . . 10
SECTION 5.2. Payment Upon Resignation or Removal. . . . . . . . . . . 10
ARTICLE VI
SUBORDINATION
SECTION 6.1. Agreement to Subordinate . . . . . . . . . . . . . . . . 11
SECTION 6.2. Default on Senior Indebtedness . . . . . . . . . . . . . 11
SECTION 6.3. Liquidation; Dissolution; Bankruptcy . . . . . . . . . . 12
SECTION 6.4. Subrogation. . . . . . . . . . . . . . . . . . . . . . . 13
i
SECTION 6.5. Trustee to Effectuate Subordination. . . . . . . . . . . 14
SECTION 6.6. Notice by the Company. . . . . . . . . . . . . . . . . . 14
SECTION 6.7. Rights of the Trustee; Holders of Senior Indebtedness. . 15
SECTION 6.8. Subordination May Not Be Impaired. . . . . . . . . . . . 15
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
SECTION 7.1. Listing on an Exchange . . . . . . . . . . . . . . . . . 16
ARTICLE VIII
FORM OF DEBENTURE
SECTION 8.1. Form of Debenture. . . . . . . . . . . . . . . . . . . . 16
ARTICLE IX
ORIGINAL ISSUE OF DEBENTURES
SECTION 9.1. Original Issue of Debentures . . . . . . . . . . . . . . 22
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Ratification of Indenture. . . . . . . . . . . . . . . . 23
SECTION 10.2. Trustee Not Responsible for Recitals . . . . . . . . . . 23
SECTION 10.3. Governing Law. . . . . . . . . . . . . . . . . . . . . . 23
SECTION 10.4. Separability . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 10.5. Counterparts . . . . . . . . . . . . . . . . . . . . . . 23
ii
FIRST SUPPLEMENTAL INDENTURE, dated as of July 24, 1996 (the "First
Supplemental Indenture"), between Sierra Pacific Power Company, a Nevada
corporation (the "Company"), and IBJ Schroder Bank & Trust Company, as trustee
(the "Trustee") under the Indenture dated as of July 1, 1996 between the Company
and the Trustee (the "Indenture").
WHEREAS, the Company executed and delivered the Indenture to the
Trustee to provide for the future issuance of the Company's unsecured junior
subordinated debt securities to be issued from time to time in one or more
series as might be determined by the Company under the Indenture, in an
unlimited aggregate principal amount which may be authenticated and delivered as
provided in the Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company desires
to provide for the establishment of a new series of its Securities to be known
as its 8.60% Junior Subordinated Debentures due July 30, 2036 (the
"Debentures"), the form and substance of such Debentures and the terms,
provisions and conditions thereof to be set forth as provided in the Indenture
and this First Supplemental Indenture;
WHEREAS, Sierra Pacific Power Capital I, a Delaware statutory business
trust (the "Trust"), has offered to the public $48.5 million aggregate
liquidation amount of its 8.60% Trust Originated Preferred Securities (the
"Preferred Securities"), representing undivided beneficial interests in the
assets of the Trust and proposes to invest the proceeds from such offering,
together with the proceeds of the issuance and sale by the Trust to the Company
of $1.5 million aggregate liquidation amount of its 8.60% Trust Originated
Common Securities, in $50.0 million aggregate principal amount of the
Debentures; and
WHEREAS, the Company has requested that the Trustee execute and
deliver this First Supplemental Indenture and all requirements necessary to make
this First Supplemental Indenture a valid instrument in accordance with its
terms, and to make the Debentures, when executed by the Company and
authenticated and delivered by the Trustee, the valid obligations of the
Company, have been performed, and the execution and delivery of this First
Supplemental Indenture has been duly authorized in all respects:
NOW THEREFORE, in consideration of the purchase and acceptance of the
Debentures by the Holders thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Debentures and the
terms, provisions and conditions thereof, the Company covenants and agrees with
the Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITION OF TERMS.
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same meaning when used in
this First Supplemental Indenture;
(b) a term defined anywhere in this First Supplemental Indenture has
the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or Article of
this First Supplemental Indenture;
(e) headings are for convenience of reference only and do not affect
interpretation;
(f) the following terms have the meanings given to them in the
Declaration: (i) Business Day; (ii) Clearing Agency; (iii) Delaware Trustee;
(iv) Depositary; (v) Dissolution Tax Opinion; (vi) No Recognition Opinion; (vii)
Preferred Security Certificate; (viii) Institutional Trustee; (ix) Regular
Trustees; (x) Special Event; and (xi) Tax Event; and (xii) Underwriting
Agreement;
(g) the following terms have the meanings given to them in this
Section 1.1(g):
"ADDITIONAL INTEREST" shall have the meaning set forth in Section 2.5.
"COMPOUNDED INTEREST" shall have the meaning set forth in Section 4.1.
"DECLARATION" means the Amended and Restated Declaration of Trust of
Sierra Pacific Power Capital I, a Delaware statutory business trust, dated as of
July 24, 1996.
"DEFERRED INTEREST" shall have the meaning set forth in Section 4.1.
"DISSOLUTION EVENT" means that, as a result of the occurrence and
continuation of a Special Event, the Trust is to be dissolved in accordance with
the Declaration, and the Debentures held by the Institutional Trustee are to be
distributed to the holders of the Trust Securities issued by the Trust PRO RATA
in accordance with the Declaration.
2
"EXTENDED INTEREST PAYMENT PERIOD" shall have the meaning set forth in
Section 4.1.
"GLOBAL DEBENTURE" shall have the meaning set forth in Section 2.4.
"MATURITY DATE" means the date on which the Debentures mature and on
which the principal shall be due and payable together with all accrued and
unpaid interest thereon including Compounded Interest and Additional Interest,
if any.
"NON BOOK-ENTRY PREFERRED SECURITIES" shall have the meaning set forth
in Section 2.4.
"OPTIONAL REDEMPTION PRICE" shall have the meaning set forth in
Section 3.2.
"SENIOR INDEBTEDNESS" means, with respect to the Company, (i) the
principal, premium, if any, and interest in respect of (A) indebtedness of such
obligor for money borrowed and (B) indebtedness evidenced by securities,
debentures, bonds or other similar instruments issued by such obligor; (ii) all
capital lease obligations of such obligor; (iii) all obligations of such obligor
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of such obligor and all obligations of such obligor under any
title retention agreement (but excluding trade accounts payable arising in the
ordinary course of business); (iv) all obligations of such obligor for the
reimbursement on any letter of credit, banker's acceptance, security purchase
facility or similar credit transaction; (v) all obligations of the type referred
to in clauses (i) through (iv) of other Persons for the payment of which such
obligor is responsible or liable as obligor, guarantor or otherwise; and (vi)
all obligations of the type referred to in clauses (i) through (v) of other
Persons secured by any lien on any property or asset of such obligor (whether or
not such obligation is assumed by such obligor), except for (1) any such
indebtedness that is by its terms subordinated to or PARI PASSU with the
Debentures, and (2) any indebtedness between or among such obligor and its
Affiliates, including all other debt securities and guarantees in respect of
those debt securities, issued to (y) any other Sierra Pacific Power Capital I or
(z) any other trust, or a trustee of such trust, partnership or other entity
affiliated with the Company which is a financing vehicle of the Company (a
"Financing Entity") in connection with the issuance by such Financial Entity of
preferred securities or other securities which rank PARI PASSU with, or junior
to, the Preferred Securities.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.1. DESIGNATION AND PRINCIPAL AMOUNT.
There is hereby authorized a series of Securities designated the
"8.60% Junior Subordinated Debentures due July 30, 2036", limited in aggregate
principal amount to $50.0
3
million, which amount shall be as set forth in any written order of the Company
for the authentication and delivery of Debentures pursuant to Section 3.3 of the
Indenture.
SECTION 2.2. MATURITY.
The Maturity Date is July 30, 2036.
SECTION 2.3. FORM AND PAYMENT.
Except as provided in Section 2.4, the Debentures shall be issued in
fully registered certificated form without interest coupons. Principal and
interest on the Debentures issued in certificated form will be payable, the
transfer of such Debentures will be registrable and such Debentures will be
exchangeable for Debentures bearing identical terms and provisions at the office
or agency of the Trustee; PROVIDED, HOWEVER, that payment of interest may be
made at the option of the Company by check mailed to the Holder at such address
as shall appear in the Security Register. Notwithstanding the foregoing, so
long as the Holder of any Debentures is the Institutional Trustee, the payment
of the principal of and interest (including Compounded Interest and Additional
Interest, if any) on such Debentures held by the Institutional Trustee will be
made at such place and to such account as may be designated by the Institutional
Trustee.
SECTION 2.4. GLOBAL DEBENTURE.
(a) In connection with a Dissolution Event,
(i) the Debentures in certificated form may be presented to the
Trustee by the Institutional Trustee in exchange for a global Debenture in
an aggregate principal amount equal to the aggregate principal amount of
all outstanding Debentures (a "Global Debenture"), to be registered in the
name of the Depositary, or its nominee, and delivered by the Trustee to the
Depositary for crediting to the accounts of its participants pursuant to
the instructions of the Regular Trustees. The Company upon any such
presentation shall execute a Global Debenture in such aggregate principal
amount and deliver the same to the Trustee for authentication and delivery
in accordance with the Indenture and this First Supplemental Indenture.
Payments on the Debentures issued as a Global Debenture will be made to the
Depositary; and
(ii) if any Preferred Securities are held in non book-entry
certificated form, the Debentures in certificated form may be presented to
the Trustee by the Institutional Trustee and any Preferred Security
Certificate which represents Preferred Securities other than Preferred
Securities held by the Clearing Agency or its nominee ("Non Book-Entry
Preferred Securities") will be deemed to represent beneficial interests in
Debentures presented to the Trustee by the Institutional Trustee having an
aggregate principal amount equal to the aggregate liquidation amount of the
Non Book-Entry Preferred Securities until such Preferred Security
Certificates are presented to the Security Registrar for transfer or
reissuance at which time such Preferred Security
4
Certificates will be cancelled and a Debenture, registered in the name of
the holder of the Preferred Security Certificate or the transferee of the
holder of such Preferred Security Certificate, as the case may be, with an
aggregate principal amount equal to the aggregate liquidation amount of the
Preferred Security Certificate cancelled, will be executed by the Company
and delivered to the Trustee for authentication and delivery in accordance
with the Indenture and this First Supplemental Indenture. On issue of such
Debentures, Debentures with an equivalent aggregate principal amount that
were presented by the Institutional Trustee to the Trustee will be deemed
to have been cancelled.
(b) A Global Debenture may be transferred, in whole but not in part,
only to another nominee of the Depositary, or to a successor Depositary selected
or approved by the Company or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary or if at any time the Depositary
for such series shall no longer be registered or in good standing under the
Securities Exchange Act of 1934, as amended, or other applicable statute or
regulation, and a successor Depositary for such series is not appointed by the
Company within 90 days after the Company receives such notice or becomes aware
of such condition, as the case may be, the Company will execute, and, subject to
Article III of the Indenture, the Trustee, upon written notice from the Company,
will authenticate and deliver the Debentures in definitive registered form
without coupons, in authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Global Debenture in exchange for
such Global Debenture. In addition, the Company may at any time determine that
the Debentures shall no longer be represented by a Global Debenture. In such
event the Company will execute, and subject to Section 3.5 of the Indenture, the
Trustee, upon receipt of an Officers' Certificate evidencing such determination
by the Company, will authenticate and deliver the Debentures in definitive
registered form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Debenture
in exchange for such Global Debenture. Upon the exchange of the Global
Debenture for such Debentures in definitive registered form without coupons, in
authorized denominations, the Global Debenture shall be cancelled by the
Trustee. Such Debentures in definitive registered form issued in exchange for
the Global Debenture shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Securities to the Depositary for delivery to the Persons in
whose names such Securities are so registered.
SECTION 2.5. INTEREST.
(a) Each Debenture will bear interest at the rate of 8.60% per annum
(the "Coupon Rate") from the original date of issuance until the principal
thereof becomes due and payable, and on any overdue principal and (to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the Coupon Rate, compounded quarterly,
payable (subject to the provisions of Article Four) quarterly in arrears
5
on March 31, June 30, September 30 and December 31 of each year (each, an
"Interest Payment Date," commencing on June 30, 1996), to the Person in whose
name such Debenture or any predecessor Debenture is registered, at the close of
business on the regular record date for such interest installment, which, in
respect of any Debentures of which the Institutional Trustee is the Holder of or
a Global Debenture, shall be the close of business on the Business Day next
preceding that Interest Payment Date. Notwithstanding the foregoing sentence,
if the Preferred Securities are no longer in book-entry only form or, except if
the Debentures are held by the Institutional Trustee, the Debentures are not
represented by a Global Debenture, the Company may select a regular record date
for such interest installment which shall be any date at least one Business Day
before an Interest Payment Date.
(b) The amount of interest payable for any period will be computed on
the basis of a 360-day year of twelve 30-day months. Except as provided in the
following sentence, the amount of interest payable for any period shorter than a
full quarterly period for which interest is computed, will be computed on the
basis of the actual number of days elapsed in such a 30-day period. In the event
that any date on which interest is payable on the Debentures is not a Business
Day, then payment of interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay), except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date.
(c) If, at any time while the Institutional Trustee is the Holder of
any Debentures, the Trust or the Institutional Trustee is required to pay any
taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed by the United States, or any other taxing
authority, then, in any case, the Company will pay as additional interest
("Additional Interest") on the Debentures held by the Institutional Trustee,
such additional amounts as shall be required so that the net amounts received
and retained by the Trust and the Institutional Trustee after paying such taxes,
duties, assessments or other governmental charges will be equal to the amounts
the Trust and the Institutional Trustee would have received had no such taxes,
duties, assessments or other government charges been imposed.
6
ARTICLE III
REDEMPTION OF THE DEBENTURES
SECTION 3.1. SPECIAL EVENT REDEMPTION.
If a Tax Event has occurred and is continuing and:
(a) the Company has received a Redemption Tax Opinion; or
(b) after receiving a Dissolution Tax Opinion, the Regular Trustees
shall have been informed by tax counsel rendering the Dissolution Tax
Opinion that a No Recognition Opinion cannot be delivered to the Trust,
then, notwithstanding Section 3.2(a) but subject to Section 3.2(b), the Company
shall have the right upon not less than 30 days nor more than 60 days notice to
the Holders of the Debentures to redeem the Debentures, in whole or in part, for
cash within 90 days following the occurrence of such Tax Event (the "90 Day
Period") at a redemption price equal to 100% of the principal amount to be
redeemed plus any accrued and unpaid interest thereon to the date of such
redemption (the "Redemption Price"), PROVIDED that if at the time there is
available to the Company the opportunity to eliminate, within the 90 Day Period,
the Tax Event by taking some ministerial action ("Ministerial Action"), such as
filing a form or making an election, or pursuing some other similar reasonable
measure which has no adverse effect on the Company, the Trust or the Holders of
the Trust Securities issued by the Trust, the Company shall pursue such
Ministerial Action in lieu of redemption, and, PROVIDED, FURTHER, that the
Company shall have no right to redeem the Debentures while the Trust is pursuing
any Ministerial Action pursuant to its obligations under the Declaration. The
Redemption Price shall be paid prior to 12:00 noon, New York time, on the date
of such redemption or such earlier time as the Company determines, PROVIDED that
the Company shall deposit with the Trustee an amount sufficient to pay the
Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price
is to be paid.
SECTION 3.2. OPTIONAL REDEMPTION BY COMPANY.
(a) Subject to the provisions of Section 3.2(b) and to the provisions
of Article XI of the Indenture, except as otherwise may be specified in this
First Supplemental Indenture, the Company shall have the right to redeem the
Debentures, in whole or in part, from time to time, on or after July 30, 2001,
at a redemption price equal to 100% of the principal amount to be redeemed plus
any accrued and unpaid interest thereon to the date of such redemption (the
"Optional Redemption Price"). Any redemption pursuant to this paragraph will be
made upon not less than 30 days nor more than 60 days' notice to the Holder of
the Debentures, at the Optional Redemption Price. If the Debentures are only
partially redeemed pursuant to this Section 3.2, the Debentures will be redeemed
PRO RATA or by lot or by any other method utilized by the Trustee; PROVIDED,
that if at the time of redemption the Debentures are registered as a Global
Debenture, the Depositary shall determine, in accordance with its procedures,
the principal
7
amount of such Debentures held by each Holder of Debenture to be redeemed. The
Optional Redemption Price shall be paid prior to 12:00 noon, New York time, on
the date of such redemption or at such earlier time as the Company determines
provided that the Company shall deposit with the Trustee an amount sufficient to
pay the Optional Redemption Price by 10:00 a.m., New York time, on the date such
Optional Redemption Price is to be paid.
(b) If a partial redemption of the Debentures would result in the
delisting of the Preferred Securities issued by the Trust from any national
securities exchange or other organization on which the Preferred Securities are
then listed, the Company shall not be permitted to effect such partial
redemption and may only redeem the Debentures in whole.
SECTION 3.3. NO SINKING FUND.
The Debentures are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1. EXTENSION OF INTEREST PAYMENT PERIOD.
The Company shall have the right, at any time and from time to time
during the term of the Debentures, to defer payments of interest by extending
the interest payment period of such Debentures for a period not exceeding 20
consecutive quarters (the "Extended Interest Payment Period"), during which
Extended Interest Payment Period no interest shall be due and payable; PROVIDED
THAT no Extended Interest Payment Period may extend beyond the Maturity Date.
To the extent permitted by applicable law, interest, the payment of which has
been deferred because of the extension of the interest payment period pursuant
to this Section 4.1, will bear interest thereon at the Coupon Rate compounded
quarterly for each quarter of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Company
shall pay all interest accrued and unpaid on the Debentures, including any
Additional Interest and Compounded Interest (together, "Deferred Interest") that
shall be payable to the Holders of the Debentures in whose names the Debentures
are registered in the Security Register on the first record date after the end
of the Extended Interest Payment Period. Before the termination of any Extended
Interest Payment Period, the Company may further extend such period, provided
that such period together with all such further extensions thereof shall not
exceed 20 consecutive quarters. Upon the termination of any Extended Interest
Payment Period and upon the payment of all Deferred Interest then due, the
Company may commence a new Extended Interest Payment Period, subject to the
foregoing requirements. No interest shall be due and payable during an Extended
Interest Payment Period, except at the end thereof, but the Company may prepay
at any time all or any portion of the interest accrued during an Extended
Interest Payment Period.
SECTION 4.2. NOTICE OF EXTENSION.
8
(a) If the Institutional Trustee is the only registered Holder of the
Debentures at the time the Company selects an Extended Interest Payment Period,
the Company shall give written notice to the Regular Trustees, the Institutional
Trustee and the Trustee of its selection of such Extended Interest Payment
Period one Business Day before the earlier of (i) the next succeeding date on
which Distributions on the Trust Securities issued by the Trust are payable, or
(ii) the date the Trust is required to give notice of the record date, or the
date such Distributions are payable, to the New York Stock Exchange or other
applicable self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Institutional Trustee is not the only Holder of the
Debentures at the time the Company selects an Extended Interest Payment Period,
the Company shall give the Holders of the Debentures and the Trustee written
notice of its selection of such Extended Interest Payment Period 10 Business
Days before the earlier of (i) the next succeeding Interest Payment Date, or
(ii) the date the Company is required to give notice of the record or payment
date of such interest payment to the New York Stock Exchange or other applicable
self-regulatory organization or to Holders of the Debentures.
(c) The quarter in which any notice is given pursuant to paragraphs
(a) or (b) of this Section 4.2 shall be counted as one of the 20 quarters
permitted in the maximum Extended Interest Payment Period permitted under
Section 4.1.
SECTION 4.3. LIMITATION OF TRANSACTIONS.
If (i) the Company shall exercise its right to defer payment of
interest as provided in Section 4.1, or (ii) there shall have occurred any Event
of Default, as defined in the Indenture, then (a) the Company shall not declare
or pay any dividend on, make any distributions with respect to, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its
capital stock or make any guarantee payment with respect thereto (other than
(i) purchases or acquisitions of shares of its common stock in connection with
the satisfaction by the Company of its obligations under any employee benefit
plans or the satisfaction by the Company of its obligations pursuant to any
contract or security requiring the Company to purchase shares of its common
stock, (ii) as a result of a reclassification of its capital stock for another
class or series of its capital stock or (iii) the purchase of fractional
interests in shares of its capital stock pursuant to the conversion or exchange
provisions of such capital stock or security being converted or exchanged) and
(b) the Company shall not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities issued by the Company
which rank pari passu with or junior to the Debentures.
9
ARTICLE V
EXPENSES
SECTION 5.1 PAYMENT OF EXPENSES.
In connection with the offering, sale and issuance of the Debentures
to the Institutional Trustee and in connection with the sale of the Trust
Securities by the Trust, the Company, in its capacity as borrower with respect
to the Debentures, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Debentures, including commissions to the underwriters payable
pursuant to the Underwriting Agreement and compensation of the Trustee under the
Indenture in accordance with the provisions of Section 6.7 of the Indenture;
(b) pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the Trust, the
offering, sale and issuance of the Trust Securities (including commissions to
the underwriters in connection therewith), the fees and expenses of the
Institutional Trustee and the Delaware Trustee, the costs and expenses relating
to the operation of the Trust, including without limitation, costs and expenses
of accountants, attorneys, statistical or bookkeeping services, expenses for
printing and engraving and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the acquisition, financing, and disposition of Trust assets);
(c) be primarily liable for any indemnification obligations arising
with respect to the Declaration; and
(d) pay any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and expenses
with respect to such taxes of the Trust.
Section 5.2 PAYMENT UPON RESIGNATION OR REMOVAL.
Upon termination of this First Supplemental Indenture or the Indenture
or the removal or resignation of the Trustee pursuant to this Section 6.10, the
Company shall pay to the Trustee all amounts accrued to the date of such
termination, removal or resignation. Upon termination of the Declaration or the
removal or resignation of the Delaware Trustee or the Institutional Trustee, as
the case may be, pursuant to Section 5.6 of the Declaration, the Company shall
pay to the Delaware Trustee or the Institutional Trustee, as the case may be,
all amounts accrued to the date of such termination, removal or resignation.
10
ARTICLE VI
SUBORDINATION
SECTION 6.1. AGREEMENT TO SUBORDINATE.
The Company covenants and agrees, and each Holder of Debentures issued
hereunder by such Holder's acceptance thereof likewise covenants and agrees,
that all Debentures shall be issued subject to the provisions of this Article
Six; and each Holder of a Debenture, whether upon original issue or upon
transfer or assignment thereof, accepts and agrees to be bound by such
provisions.
The payment by the Company of the principal of, premium, if any, and
interest on all Debentures issued hereunder shall, to the extent and in the
manner hereinafter set forth, be subordinated and junior in right of payment to
the prior payment in full of all Senior Indebtedness of the Company, whether
outstanding at the date of this Indenture or thereafter incurred.
No provision of this Article Six shall prevent the occurrence of any
default or Event of Default hereunder.
SECTION 6.2. DEFAULT ON SENIOR INDEBTEDNESS.
In the event and during the continuation of any default by the Company
in the payment of principal, premium, interest or any other payment due on any
Senior Indebtedness of the Company, as the case may be, or in the event that the
maturity of any Senior Indebtedness of the Company, as the case may be, has been
accelerated because of a default, then, in either case, no payment shall be made
by the Company with respect to the principal (including redemption and sinking
fund payments) of, or premium, if any, or interest on the Debentures.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section 6.2, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Indebtedness may have
been issued, as their respective interests may appear, but only to the extent
that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing within 90 days of
such payment of the amounts then due and owing on the Senior Indebtedness and
only the amounts specified in such notice to the Trustee shall be paid to the
holders of Senior Indebtedness.
11
SECTION 6.3. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any payment by the Company or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Senior Indebtedness
of the Company shall first be paid in full, or payment thereof provided for in
money in accordance with its terms, before any payment is made by the Company on
account of the principal (and premium, if any) or interest on the Debentures;
and upon any such dissolution or winding-up or liquidation or reorganization,
any payment by the Company, or distribution of assets of the Company of any kind
or character, whether in cash, property or securities, to which the Holders of
the Debentures or the Trustee would be entitled to receive from the Company,
except for the provisions of this Article Six, shall be paid by the Company or
by any receiver, trustee in bankruptcy, liquidating trustee, agent or other
Person making such payment or distribution, or by the Holders of the Debentures
or by the Trustee under the Indenture if received by them or it, directly to the
holders of Senior Indebtedness of the Company (PRO RATA to such holders on the
basis of the respective amounts of Senior Indebtedness held by such holders, as
calculated by the Company) or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay such Senior Indebtedness in
full, in money or money's worth, after giving effect to any concurrent payment
or distribution to or for the holders of such Senior Indebtedness, before any
payment or distribution is made to the Holders of Debentures or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee before all Senior Indebtedness of the Company is paid in full, or
provision is made for such payment in money in accordance with its terms, such
payment or distribution shall be held in trust for the benefit of and shall be
paid over or delivered to the holders of such Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, and their respective interests may appear, as calculated
by the Company, for application to the payment of all Senior Indebtedness of the
Company, as the case may be, remaining unpaid to the extent necessary to pay
such Senior Indebtedness in full in money in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the benefit of
the holders of such Senior Indebtedness.
For purposes of this Article Six, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article Six with respect
to the Debentures to the payment of all Senior Indebtedness of the Company, as
the
12
case may be, that may at the time be outstanding, provided that (i) such Senior
Indebtedness is assumed by the new corporation, if any, resulting from any such
reorganization or readjustment, and (ii) the rights of the holders of such
Senior Indebtedness are not, without the consent of such holders, altered by
such reorganization or readjustment. The consolidation of the Company with, or
the merger of the Company into, another corporation or the liquidation or
dissolution of the Company following the conveyance or transfer of its property
as an entirety, or substantially as an entirety, to another corporation upon the
terms and conditions provided for in Article VIII of the Indenture shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section 6.3 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article VIII of the Indenture. Nothing in Section 6.2 or in this Section 6.3
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 6.7 of the Indenture.
SECTION 6.4. SUBROGATION.
Subject to the payment in full of all Senior Indebtedness of the
Company, the rights of the Holders of the Debentures shall be subrogated to the
rights of the holders of such Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company, as the case may
be, applicable to such Senior Indebtedness until the principal of (and premium,
if any) and interest on the Debentures shall be paid in full; and, for the
purposes of such subrogation, no payments or distributions to the holders of
such Senior Indebtedness of any cash, property or securities to which the
Holders of the Debentures or the Trustee would be entitled except for the
provisions of this Article Six, and no payment over pursuant to the provisions
of this Article Six to or for the benefit of the holders of such Senior
Indebtedness by Holders of the Debentures or the Trustee, shall, as between the
Company, its creditors other than Holders of Senior Indebtedness of the Company,
and the holders of the Debentures, be deemed to be a payment by the Company to
or on account of such Senior Indebtedness. It is understood that the provisions
of this Article Six are and are intended solely for the purposes of defining the
relative rights of the Holders of the Debentures, on the one hand, and the
holders of such Senior Indebtedness on the other hand.
Nothing contained in this Article Six or elsewhere in the Indenture,
this First Supplemental Indenture or in the Debentures is intended to or shall
impair, as between the Company, its creditors other than the holders of Senior
Indebtedness of the Company, and the Holders of the Debentures, the obligation
of the Company, which is absolute and unconditional, to pay to the Holders of
the Debentures the principal of (and premium, if any) and interest on the
Debentures as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the
Holders of the Debentures and creditors of the Company, as the case may be,
other than the holders of Senior Indebtedness of the Company, as the case may
be, nor shall anything herein or therein prevent the Trustee or the Holder of
any Debenture from exercising all remedies otherwise permitted by applicable law
upon default under the Indenture, subject to the rights, if any, under this
Article Six of the holders of such Senior Indebtedness in respect of cash,
property or securities of the Company, as the case may be, received upon the
exercise of any such remedy.
13
Upon any payment or distribution of assets of the Company referred to
in this Article Six, the Trustee, subject to the provisions of Section 6.1 of
the Indenture, and the Holders of the Debentures shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Debentures, for the purposes of ascertaining the Persons entitled to participate
in such distribution, the holders of Senior Indebtedness and other indebtedness
of the Company, as the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Six.
SECTION 6.5. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of Debentures by such Holder's acceptance thereof
authorizes and directs the Trustee on such Holder's behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article Six and appoints the Trustee such Holder's attorney-in-fact for any
and all such purposes.
SECTION 6.6. NOTICE BY THE COMPANY.
The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment of monies to or by the Trustee in respect of the Debentures
pursuant to the provisions of this Article Six. Notwithstanding the provisions
of this Article Six or any other provision of the Indenture and this First
Supplemental Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment of monies
to or by the Trustee in respect of the Debentures pursuant to the provisions of
this Article Six, unless and until a Responsible Officer of the Trustee shall
have received written notice thereof from the Company or a holder or holders of
Senior Indebtedness or from any trustee therefor; and before the receipt of any
such written notice, the Trustee, subject to the provisions of Section 6.1 of
the Indenture, shall be entitled in all respects to assume that no such facts
exist; PROVIDED, HOWEVER, that if the Trustee shall not have received the notice
provided for in this Section 6.6 at least two Business Days prior to the date
upon which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (or premium, if
any) or interest on any Debenture), then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such money and to apply the same to the purposes for which they were
received, and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to such date.
The Trustee, subject to the provisions of Section 6.1 of the
Indenture, shall be entitled to conclusively rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness of the Company, as the case may be (or a trustee on behalf of such
holder), to establish that such notice has been given by a holder of such Senior
14
Indebtedness or a trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of such Senior Indebtedness to
participate in any payment or distribution pursuant to this Article Six, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of such Senior Indebtedness held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Six, and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
SECTION 6.7. RIGHTS OF THE TRUSTEE; HOLDERS OF SENIOR INDEBTEDNESS.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article Six in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
With respect to the holders of Senior Indebtedness of the Company, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article Six, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into the Indenture or this First Supplemental Indenture against
the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of such Senior Indebtedness and, subject to the provisions of Section
6.1 of the Indenture, the Trustee shall not be liable to any holder of such
Senior Indebtedness if it shall pay over or deliver to Holders of Debentures,
the Company or any other Person money or assets to which any holder of such
Senior Indebtedness shall be entitled by virtue of this Article Six or
otherwise.
SECTION 6.8. SUBORDINATION MAY NOT BE IMPAIRED.
No right of any present or future holder of any Senior Indebtedness of
the Company to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company, as the case may be, or by any act or failure to act, in good faith, by
any such holder, or by any noncompliance by the Company, as the case may be,
with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness of the Company may, at any time and from time
to time, without the consent of or notice to the Trustee or the Holders of the
Debentures, without incurring responsibility to the Holders of the Debentures
and without impairing or releasing the subordination provided in this Article
Six or the obligations hereunder of the Holders of the Debentures to the holders
of such Senior Indebtedness, do any one or more of the following: (i) change
the
15
manner, place or terms of payment or extend the time of payment of, or renew or
alter, such Senior Indebtedness, or otherwise amend or supplement in any manner
such Senior Indebtedness or any instrument evidencing the same or any agreement
under which such Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing such Senior Indebtedness; (iii) release any Person liable in any manner
for the collection of such Senior Indebtedness; and (iv) exercise or refrain
from exercising any rights against the Company, as the case may be, and any
other Person.
ARTICLE VII
COVENANT TO LIST ON EXCHANGE
SECTION 7.1. LISTING ON AN EXCHANGE.
If the Debentures are to be issued as a Global Debenture in connection
with the distribution of the Debentures to the holders of the Preferred
Securities issued by the Trust upon a Dissolution Event, the Company will use
its best efforts to list such Debentures on the New York Stock Exchange, Inc. or
on such other exchange as the Preferred Securities are then listed.
ARTICLE VIII
FORM OF DEBENTURE
SECTION 8.1. FORM OF DEBENTURE.
The Debentures and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the following forms:
(FORM OF FACE OF DEBENTURE)
[IF THE Debenture IS TO BE A GLOBAL DEBENTURE, INSERT - This Debenture
is a Global Debenture within the meaning of the Indenture hereinafter referred
to and is registered in the name of a Depositary or a nominee of a Depositary.
This Debenture is exchangeable for Debentures registered in the name of a person
other than the Depositary or its nominee only in the limited circumstances
described in the Indenture, and no transfer of this Debenture (other than a
transfer of this Debenture as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary) may be registered except in limited circumstances.
Unless this Debenture is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the issuer
or its agent for registration of transfer, exchange or payment, and any
Debenture issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER,
16
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since
the registered owner hereof, Cede & Co., has an interest herein.]
No. R-__
SIERRA PACIFIC POWER COMPANY
8.60% JUNIOR SUBORDINATED DEBENTURE
DUE July 30, 2006
Sierra Pacific Power Company, a Nevada corporation (the "Company",
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to, ______________ or
registered assigns, the principal sum of _____________ Dollars ($___________) on
_________, ____, and to pay interest on said principal sum from July 29, 1996,
or from the most recent interest payment date (each such date, an "Interest
Payment Date") to which interest has been paid or duly provided for, quarterly
(subject to deferral as set forth herein) in arrears on March 31, June 30,
September 30 and December 31 of each year commencing June 30, 1996, at the rate
of 8.60% per annum until the principal hereof shall have become due and payable,
and on any overdue principal and premium, if any, and (without duplication and
to the extent that payment of such interest is enforceable under applicable law)
on any overdue installment of interest at the same rate per annum compounded
quarterly. The amount of interest payable on any Interest Payment Date shall be
computed on the basis of a 360-day year of twelve 30-day months. In the event
that any date on which interest is payable on this Debenture is not a Business
Day, then payment of interest payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay), except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date. The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the person in whose name this Debenture (or one or more Predecessor
Securities, as defined in said Indenture) is registered at the close of business
on the regular record date for such interest installment, which shall be the
close of business on the business day next preceding such Interest Payment Date.
[IF PURSUANT TO THE PROVISIONS OF THE INDENTURE THE DEBENTURES ARE NO LONGER
REPRESENTED BY A GLOBAL DEBENTURE -- which shall be the close of business on the
____ business day next preceding such Interest Payment Date.] Any such interest
installment not punctually paid or duly provided for shall forthwith cease to be
payable to the registered Holders on such regular record date and may be paid to
the Person in whose name this Debenture (or one or more Predecessor Securities)
is registered at the close of business on a special record date to be fixed by
the Trustee for the payment of such defaulted interest, notice whereof shall be
given to the registered Holders of this series of Debentures not
17
less than 10 days prior to such special record date, or may be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Debentures may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in the
Indenture. The principal of (and premium, if any) and the interest on this
Debenture shall be payable at the office or agency of the Trustee maintained for
that purpose in any coin or currency of the United States of America that at the
time of payment is legal tender for payment of public and private debts;
PROVIDED, HOWEVER, that payment of interest may be made at the option of the
Company by check mailed to the registered Holder at such address as shall appear
in the Security Register. Notwithstanding the foregoing, so long as the Holder
of this Debenture is the Institutional Trustee, the payment of the principal of
(and premium, if any) and interest on this Debenture will be made at such place
and to such account as may be designated by the Institutional Trustee.
The indebtedness evidenced by this Debenture is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Indebtedness, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder of
this Debenture, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each Holder hereof, by his or
her acceptance hereof, hereby 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.
This Debenture shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the Certificate of Authentication hereon shall have been signed by or on
behalf of the Trustee.
The provisions of this Debenture are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
18
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
Dated_____________________
SIERRA PACIFIC POWER COMPANY
By:________________________________
Name:
Title
Attest:
By:_______________________
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Debentures of the series of Debentures described in
the within-mentioned Indenture.
[ ]
or as Authentication Agent
By_______________________ By__________________________
Authorized Signatory Authorized Signatory
(FORM OF REVERSE OF DEBENTURE)
This Debenture is one of a duly authorized series of Debentures of the
Company (herein sometimes referred to as the "Debentures"), specified in the
Indenture, all issued or to be issued in one or more series under and pursuant
to an Indenture dated as of July 1, 1996, duly executed and delivered between
the Company and IBJ Schroder Bank & Trust Company, as Trustee (the "Trustee"),
as supplemented by the First Supplemental Indenture dated as of July 24, 1996,
between the Company and the Trustee (the Indenture as so supplemented, the
"Indenture"), to which Indenture and all indentures supplemental thereto
reference is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the Holders of the Debentures. By the terms of the Indenture, the Debentures
are issuable in series that may vary as to amount, date of maturity, rate of
interest and in other respects as provided in the Indenture. This series of
Debentures is limited in aggregate principal amount as specified in said First
Supplemental Indenture.
19
Because of the occurrence and continuation of a Tax Event, in certain
circumstances, this Debenture may become due and payable at the principal amount
together with any interest accrued thereon (the "Redemption Price"). The
Redemption Price shall be paid prior to 12:00 noon, New York time, on the date
of such redemption or at such earlier time as the Company determines. The
Company shall have the right to redeem this Debenture at the option of the
Company, without premium or penalty, in whole or in part at any time on or after
July 30, 2001 (an "Optional Redemption"), or at any time in certain
circumstances upon the occurrence of a Tax Event, at a redemption price equal to
100% of the principal amount plus any accrued but unpaid interest, to the date
of such redemption (the "Optional Redemption Price"). Any redemption pursuant
to this paragraph will be made upon not less than 30 days' nor more than 60
days' notice, at the Optional Redemption Price. If the Debentures are only
partially redeemed by the Company pursuant to an Optional Redemption, the
Debentures will be redeemed PRO RATA or by lot or by any other method utilized
by the Trustee; provided that if, at the time of redemption, the Debentures are
registered as a Global Debenture, the Depositary shall determine the principal
amount of such Debentures held by each Debentureholder to be redeemed in
accordance with its procedures.
In the event of redemption of this Debenture in part only, a new
Debenture or Debentures of this series for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Debentures may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures of each series affected at the time
outstanding, as defined in the Indenture, to execute supplemental indentures for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Debentures; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any Debentures of any series, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon, or reduce any
premium payable upon the redemption thereof, without the consent of the Holder
of each Debenture so affected, or (ii) reduce the aforesaid percentage of
Debentures, the Holders of which are required to consent to any such
supplemental indenture, without the consent of the Holders of each Debenture
then outstanding and affected thereby. The Indenture also contains provisions
permitting the Holders of a majority in aggregate principal amount of the
Debentures of any series at the time outstanding affected thereby, on behalf of
all of the Holders of the Debentures of such series, to waive any past default
in the performance of any of the covenants contained in the Indenture, or
established pursuant to the Indenture with respect to such series, and its
consequences, except a default in the payment of the principal of or premium, if
any, or interest on any of the Debentures of such series. Any
20
such consent or waiver by the registered Holder of this Debenture (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
Holder and upon all future Holders and owners of this Debenture and of any
Debenture issued in exchange herefor or in place hereof (whether by registration
of transfer or otherwise), irrespective of whether or not any notation of such
consent or waiver is made upon this Debenture.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Debenture at the time and place and at the
rate and in the money herein prescribed.
The Company shall have the right at any time during the term of the
Debentures and from time to time to extend the interest payment period of such
Debentures for up to 20 consecutive quarters (an "Extended Interest Payment
Period"), at the end of which period the Company shall pay all interest then
accrued and unpaid (together with interest thereon at the rate specified for the
Debentures to the extent that payment of such interest is enforceable under
applicable law). Before the termination of any such Extended Interest Payment
Period, the Company may further extend such Extended Interest Payment Period,
provided that such Extended Interest Payment Period together with all such
further extensions thereof shall not exceed 20 consecutive quarters. At the
termination of any such Extended Interest Payment Period and upon the payment of
all accrued and unpaid interest and any additional amounts then due, the Company
may commence a new Extended Interest Payment Period.
As provided in the Indenture and subject to certain limitations
therein set forth, this Debenture is transferable by the registered Holder
hereof on the Security Register of the Company, upon surrender of this Debenture
for registration of transfer at the office or agency of the Trustee in the City
and State of New York accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company or the Trustee duly executed by the
registered Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Debentures of authorized denominations and for the
same aggregate principal amount and series will be issued to the designated
transferee or transferees. No service charge will be made for any such transfer,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this
Debenture, the Company, the Trustee, any paying agent and the Security Registrar
may deem and treat the registered holder hereof as the absolute owner hereof
(whether or not this Debenture shall be overdue and notwithstanding any notice
of ownership or writing hereon made by anyone other than the Security Registrar)
for the purpose of receiving payment of or on account of the principal hereof
and premium, if any, and interest due hereon and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Security
Registrar shall be affected by any notice to the contrary.
21
No recourse shall be had for the payment of the principal of or the
interest on this Debenture, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
[The Debentures of this series are issuable only in registered form
without coupons in denominations of $25 and any integral multiple thereof.]
[This Global Debenture is exchangeable for Debentures in definitive form only
under certain limited circumstances set forth in the Indenture. Debentures of
this series so issued 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 certain limitations [herein and] therein set forth,
Debentures of this series [so issued] are exchangeable for a like aggregate
principal amount of Debentures of this series of a different authorized
denomination, as requested by the Holder surrendering the same.
All terms used in this Debenture that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE IX
ORIGINAL ISSUE OF DEBENTURES
SECTION 9.1 ORIGINAL ISSUE OF DEBENTURES.
Debentures in the aggregate principal amount of $50.0 million may,
upon execution of this First Supplemental Indenture, be executed by the Company
and delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Debentures to or upon the written order of the
Company, signed by its Chairman, its Vice Chairman, its President, or any Vice
President and its Treasurer or an Assistant Treasurer, without any further
action by the Company.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 RATIFICATION OF INDENTURE.
The Indenture, as supplemented by this First Supplemental Indenture,
is in all respects ratified and confirmed, and this First Supplemental Indenture
shall be deemed part of the Indenture in the manner and to the extent herein and
therein provided.
22
SECTION 10.2 TRUSTEE NOT RESPONSIBLE FOR RECITALS.
The recitals herein contained are made by the Company and not by the
Trustee, and the Trustee assumes no responsibility for the correctness thereof.
The Trustee makes no representation as to the validity or sufficiency of this
First Supplemental Indenture.
SECTION 10.3 GOVERNING LAW.
This First Supplemental Indenture and each Debenture shall be deemed
to be a contract made under the internal laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of said State.
SECTION 10.4 SEPARABILITY.
In case any one or more of the provisions contained in this First
Supplemental Indenture or in the Debentures shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this First
Supplemental Indenture or of the Debentures, but this First Supplemental
Indenture and the Debentures shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein or therein.
SECTION 10.5 COUNTERPARTS.
This First Supplemental Indenture may be executed in any number of
counterparts each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
23
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, on the date or dates indicated in the
acknowledgements and as of the day and year first above written.
SIERRA PACIFIC POWER COMPANY
By______________________________________
Name:
Title:
[Seal]
Attest:
By:______________________
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By______________________________________
Name:
Title:
Attest:
By:______________________
DS1-251121