Exhibit 4.10
DEPOSIT AGREEMENT
BETWEEN
BANKERS TRUST COMPANY
and
SOUTHERN INVESTMENTS UK plc
Dated as of January 29, 1997
TABLE OF CONTENTS
Page
ARTICLE I.....................................................................1
SECTION 1.01. Definitions...................................................1
SECTION 1.02. Rules of Construction.........................................3
ARTICLE II....................................................................4
SECTION 2.01. Deposit of the Global Debenture...............................4
SECTION 2.02. Book-Entry System.............................................4
SECTION 2.03. Registration of Transfer of the Book-
Entry Interest................................................5
SECTION 2.04. Transfer of the Global Debenture..............................5
SECTION 2.05. Cancellation..................................................6
SECTION 2.06. Payments in Respect of a Book-
Entry Interest and Global Debenture...........................6
SECTION 2.07. Change in Principal Amount of the Global Debenture............7
SECTION 2.08. Record Date...................................................7
SECTION 2.09. Action in Respect of a Book-Entry Interest
or the Global Debenture.......................................7
SECTION 2.10. Surrender of the Global Debenture.............................8
SECTION 2.11. Reports.......................................................8
SECTION 2.12. Additional Amounts............................................8
ARTICLE III...................................................................9
SECTION 3.01. Certain Duties and Responsibilities...........................9
SECTION 3.02. Notice of Default............................................10
SECTION 3.03. Certain Rights of Book-Entry Depositary......................10
SECTION 3.04. Not Responsible for Recitals or Issuance
of Subordinated Debentures...................................11
SECTION 3.05. Money Held in Trust..........................................11
SECTION 3.06. Compensation and Reimbursement...............................12
SECTION 3.07. Book-Entry Depositary Required; Eligibility..................12
SECTION 3.08. Resignation and Removal; Appointment of Successor............12
SECTION 3.09. Acceptance of Appointment by Successor.......................14
SECTION 3.10. Merger, Conversion, Consolidation or Succession to Business.15
ARTICLE IV...................................................................15
SECTION 4.01. Notices to Book-Entry Depositary or Company.................15
SECTION 4.02. Notice to Depositary; Waiver................................15
SECTION 4.03. Effect of Headings and Table of Contents....................16
SECTION 4.04. Successors and Assigns......................................16
SECTION 4.05. Separability Clause.........................................16
SECTION 4.06. Benefits of Agreement.......................................16
SECTION 4.07. GOVERNING LAW...............................................16
SECTION 4.08. Jurisdiction................................................16
SECTION 4.09. Counterparts................................................17
SECTION 4.10. Inspection of Agreement.....................................17
SECTION 4.11. Satisfaction and Discharge..................................17
SECTION 4.12. Amendments..................................................17
SECTION 4.13. Book-Entry Depositary To Sign Amendments....................18
DEPOSIT AGREEMENT
This Deposit Agreement (as the same may be amended from time
to time in accordance with the provisions hereof, the "Deposit Agreement"),
dated as of January 29, 1997, is among Bankers Trust Company, a New York banking
corporation, as book-entry depositary hereunder (the "Book-Entry Depositary"),
Southern Investments UK plc, a public limited company organized under the laws
of England and Wales (the "Company"), holders of, and owners of beneficial
interests in, certificated depositary interests ("CDIs") issued hereunder in
respect of a beneficial interest in the Global Debenture (as defined below)
representing one or more Subordinated Debentures issued to Institutional
Accredited Investors (the Subordinated Debentures being issued pursuant to an
Indenture (the "Indenture"), dated as of January 29, 1997, between (inter alia)
Bankers Trust Company, as trustee (the "Trustee"), and the Company, as issuer)
and beneficial owners of Book-Entry Interests (as defined below).
ARTICLE I
Definitions and Other General Provisions
SECTION 1.01. Definitions. Terms not defined herein have the meanings
ascribed to them in the Indenture (as hereinafter defined). The following terms,
as used herein, have the following meanings:
"Beneficial Owner" means any person owning a beneficial interest in a
CDI issued hereunder but who is not the Holder of such CDI and may include any
DTC Participant (as defined below); it being understood that the term
"Beneficial Owner" shall not include any agent or financial intermediary holding
an interest in a CDI solely to the extent such interest is held for or on behalf
of any Beneficial Owner.
"Book-Entry Depositary" means the party named as such in this Agreement
or its nominee or the custodian of either until a successor shall have become
such pursuant to Section 3.08 hereof, and thereafter "Book-Entry Depositary"
shall mean such successor or its nominee or the custodian of either.
"Book-Entry Interests" means the 8.23% certificateless depositary
interests that shall at all times, prior to the issuance of Definitive
Registered Debentures in respect thereof, represent the right to receive 100% of
the principal, premium (if any), interest and Additional Amounts, Additional
Sums and Additional Interest (if any) of the underlying 8.23% Global
Subordinated Debenture due 2027 and that are issued to the Trust , and should
the Trust be dissolved pursuant to the terms of the Declaration of Trust, that
percentage of the 8.23% Global Subordinated Debenture due 2027 not beneficially
owned by Institutional Accredited Investors, the Book-Entry Interests in such
case being issued to DTC or its nominee by the Book-Entry Depositary.
"Book-Entry Register" has the meaning ascribed thereto in Section 2.03
hereof.
"CDI" means a certificated depositary interest to be issued hereunder
representing an Interest in the Global Debenture issued to Institutional
Accredited Investors. For the purposes of this Deposit Agreement, CDIs shall be
deemed to be "depositary shares" (as defined in Rule 405 under the Securities
Act) that represent the interests in the Global Debenture.
"Company" means the party named as such in this Agreement until a
successor replaces it pursuant to the applicable provisions of the Indenture
and, thereafter, means the successor.
"Corporate Trust Office" means the office of the Book-Entry Depositary
in the City of New York, at which any particular time its corporate trust
business shall be principally administered, which at the date hereof is located
at Bankers Trust Company, Four Albany Street, New York, NY 10006, Attn:
Corporate Trust and Agency Group - Manager Public Utilities Group.
"Declaration of Trust" means the Amended and Restated Declaration of
Trust dated as of January 29, 1997 by the Trustees (as defined therein), the
Company and the holders, from time to time, of undivided beneficial interests in
the Trust to be issued pursuant to such Declaration of Trust.
"Definitive Registered Debentures" means the 8.23% Subordinated
Debentures due 2027 issued pursuant to the Indenture in substantially the form
of Exhibit B to the Indenture.
"Depositary" means the Trust (or DTC or any successor, in the event
that the Trust be dissolved pursuant to the terms of the Declaration of Trust)
as the depositary of the Book-Entry Interests as recorded on the Book-Entry
Register.
"DTC" means The Depository Trust Company or its nominee.
"Global Debenture" means the 8.23% Global Subordinated Debenture due
2027 in bearer form issued pursuant to the Indenture in substantially the same
form as Exhibit A to the Indenture.
"Indenture" means the Indenture dated as of January 29, 1997, between
the Company and Bankers Trust Company, as Trustee, and Bankers Trust Luxembourg
S.A. as paying and transfer agent relating to the Subordinated Debentures as
originally executed or as it may from time to time be supplemented or amended by
one or more indentures supplemental thereto entered into pursuant to the
applicable provisions thereof, including for all purposes to the extent
applicable, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern such instrument.
"Indenture Trustee" means Bankers Trust Company as trustee under the
Indenture.
"Institutional Accredited Investor" means an institutional "accredited
investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
"Interests" means beneficial interests in the Book-Entry Interests that
will be represented by Trust Securities until the Trust is dissolved pursuant to
the terms of the Declaration of Trust, whereafter the interests will be shown on
records maintained in book-entry form by DTC and to the extent not beneficially
owned by Institutional Accredited Investors.
"Opinion of Counsel" means a written opinion from legal counsel, who
may be an employee of or regular counsel for the Company or may be other counsel
reasonably acceptable to the Book-Entry Depositary.
"Responsible Officer", when used with respect to the Trustee, means any
Managing Director, vice president, any assistant vice president, assistant
secretary, the treasurer, any assistant treasurer, any trust officer or
assistant trust officer or any other officer in the Corporate Trust and Agency
Group 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 that officer's knowledge of and familiarity with the
particular subject.
"Securities Act" means the U.S. Securities Act of 1933, as amended.
"Subordinated Debenture" means any 8.23% Subordinated Debenture due
2027 of the Company issued under the Indenture.
"Trust" means Southern Investments UK Capital Trust I, a statutory
business trust formed under the laws of the State of Delaware.
"Trust Securities" means the capital securities which represent
preferred beneficial interests in the assets of the Trust and the common
securities which represent beneficial interests in the assets of the Trust.
"Trustee" means Bankers Trust Company and its successors and assigns,
as trustee under the Indenture.
SECTION 1.02. Rules of Construction. Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) "or" is not exclusive;
(c) "including" means including without limitation; and
(d) words in the singular include the plural and words in the plural
include the singular.
ARTICLE II
Interests
SECTION 2.01. Deposit of the Global Debenture. The Book-Entry
Depositary hereby accepts custody of the Global Debenture from the Trustee and
shall act as Book-Entry Depositary in accordance with the terms of this
Agreement. The Book-Entry Depositary shall hold such Global Debenture at its
Corporate Trust Office in the City of New York or at such place as it shall
determine with the consent of the Company for the benefit of the Trust. If
Book-Entry Interests in the Subordinated Debentures are distributed to holders
of Trust Securities in dissolution of the Trust, such Book-Entry Interests will
be transferred by the Trust to DTC, which will operate a book-entry system for
Interests in the Book-Entry Interests in the Global Debenture held by the
Book-Entry Depositary and representing all of the Subordinated Debentures
subject to Section 2.02(c) hereof. At that time, the Book-Entry Interests in the
Subordinated Debentures will cease to be held for the benefit of the Trust and
will be held by the Book-Entry Depositary for the benefit of DTC and its
participants subject to Section 2.02(c) hereof. All of the Book-Entry Interests
in the Global Debenture will be transferred by the Trust to DTC, and to the
extent that Capital Securities are held in certificated form, such Interests
will be issued as CDIs pursuant to Section 2.02(c).
SECTION 2.02. Book-Entry System. .(a) Upon acceptance by DTC of the
Book-Entry Interests for entry into its book-entry settlement system in
accordance with the terms of the Letter of Representations, Interests in the
Book-Entry Interests will be recorded on and traded through DTC's book-entry
system, and ownership of such Interests shall be shown in, and the transfer of
such ownership shall be effected only through, records maintained by (i) DTC or
its successors or (ii) institutions that have accounts with DTC or its
successors ("DTC Participants"). Interests shall be transferable only as units
representing authorized denominations of the Subordinated Debentures.
(b) The Book-Entry Interests shall be issuable only to DTC, or
successors of DTC or their respective nominees. Except as provided in Section
2.07, no owner of Interests shall be entitled to receive a Subordinated
Debenture on account of such ownership, and such owner's Interests shall be
shown only in accordance with the procedures of DTC as set forth in the Letter
of Representations.
(c) Upon deposit with the Depositary of the Global Debenture to the
extent that it represents Subordinated Debentures held by Institutional
Accredited Investors with the Depositary, the Depositary shall issue and deliver
to the Holder a CDI in respect of such Global Debenture. One CDI will be issued
in respect of each Institutional Accredited Investor's interest in such Global
Debenture and the CDIs in respect of such Global Debenture shall represent
beneficial ownership of 100% of the principal amount of such Institutional
Accredited Investor's interest in such Global Debenture. No person shall be
required to account to the Depositary for the proceeds of the sale of interests
in any CDIs.
Neither the Holder nor any Beneficial Owner of a CDI shall be entitled
to any benefits under this Deposit Agreement nor shall any CDI be valid or
obligatory for any purpose, unless such CDI shall have been properly credited on
the books of the Depositary in the name of the Holder thereof.
It shall be a condition of each CDI, and every successive Holder and
Beneficial Owner by holding or owning the same shall be deemed to have consented
and agreed, that title to such CDI, when accompanied by proper instruments of
transfer, is transferable only by appropriate entry on the books of the
Depositary and that the Depositary, notwithstanding any notice to the contrary,
may treat the Holder of a CDI on its books as the absolute owner thereof for the
purpose of determining the person entitled to payments on such CDI under this
Deposit Agreement or to any notices provided for in the Deposit Agreement and
for all other purposes.
SECTION 2.03. Registration of Transfer of the Book-Entry Interests and
CDIs. The Book-Entry Depositary agrees to maintain at the Book-Entry
Depositary's Corporate Trust Office the Book-Entry Register in which the
Book-Entry Depositary shall (i) record the Trust as the initial registered owner
of such Book-Entry Interests and (ii) after such time that the Trust is
dissolved and the Book-Entry Interests are held by DTC, record the registration
and transfer of the Book-Entry Interests and the CDIs. (Notwithstanding anything
contained herein to the contrary, the Book-Entry Interests shall be transferred
only according to the Declaration of Trust for so long as the Trust owns the
Book-Entry Interests. ) The Book-Entry Interests and the CDIs cannot be
transferred at any time unless such transfer is recorded on the Book-Entry
Register. The Book-Entry Depositary shall not constitute the agent of the
Company for any other purpose and, in particular, it shall not constitute the
agent of the Company in relation to any payments it may make to the owner of the
Book-Entry Interests or be authorized to undertake any obligations on behalf of
the Company.
The foregoing paragraph shall not (i) impose an obligation on the
Book-Entry Depositary to record the ownership interests in or transfers of
Interests held by DTC Participants or its successors or Persons that may hold
Interests through such institutions or (ii) restrict transfers of such Interests
held by DTC Participants or such Persons. The Book-Entry Depositary shall treat
the Depositary or its nominee or their respective successors as the absolute
owner of the Book-Entry Interest and the CDIs for all purposes whatsoever and
shall not be bound or affected by any notice to the contrary, other than an
order of a court having jurisdiction over the Book-Entry Depositary.
SECTION 2.04. Transfer of the Global Debenture. The Book-Entry
Depositary shall hold the Global Debenture in custody for the benefit of the
Depositary. The Book-Entry Depositary shall not transfer or lend the Global
Debenture or any interest therein, except that the Book-Entry Depositary may
transfer the Global Debenture as a whole to a successor Book-Entry Depositary
with the consent of the Company. Notwithstanding the foregoing, the Depositary
may not under any circumstances request the Book-Entry Depositary to surrender
or deliver the Global Debenture to the Depositary). If (i) after the dissolution
of the Trust DTC (as the Depositary) notifies the Company and the Book-Entry
Depositary that it is unwilling or unable to continue to hold the Book-Entry
Interests or if at any time it ceases to be, a "clearing agency" registered
under the Exchange Act and a successor registered as a "clearing agency" under
the Exchange Act is not appointed by the Company within 120 days; (ii) the
Book-Entry Depositary notifies the Company under Section 3.08 hereof that it is
unwilling or unable to continue as Book-Entry Depositary with respect to the
Global Debenture and no successor is appointed by the Company within 120 days of
such notification; (iii) the Company in its sole discretion determines that a
Definitive Registered Debenture shall be issued and executes and delivers to the
Indenture Trustee an Officer's Certificate providing that the Global Debenture
shall be so exchanged; or (iv) an Event of Default (as defined in the Indenture)
has occurred and is continuing with respect to the Subordinated Debentures and
the holders of a majority in outstanding principal amount of Interests in a
Book-Entry Interest has requested in writing that the Global Debenture be
exchanged for one or more Definitive Registered Debentures in accordance with
Section 2.07 hereof and the Indenture, in which case all of the owners of
Interests in such Book-Entry Interest and the CDIs will receive Definitive
Registered Debentures in respect of their Interests, then the Book-Entry
Depositary will promptly notify the Trustee and request the Trustee to
authenticate Definitive Registered Debentures in such names and denominations as
the Depositary shall specify in accordance with the relevant provisions of the
Indenture, and the Book-Entry Depositary agrees that in such event it will
promptly surrender the Global Debenture held by it to the Trustee in connection
with such exchange and that such Global Debenture will be canceled upon issuance
of such Definitive Registered Debentures. All costs (taxes, governmental charges
or otherwise) related to the issuance of Definitive Registered Debentures will
be borne by the Company subject to any exceptions set forth in the Indenture.
SECTION 2.05. Cancellation. If the Global Debenture is surrendered for
payment, or for redemption of Subordinated Debentures evidenced thereby or for
exchange for Definitive Registered Debentures to any Person other than the
Indenture Trustee, such Global Debenture shall, subject to Section 2.07, be
delivered to the Indenture Trustee for cancellation.
SECTION 2.06. Payments in Respect of a Book-Entry Interest and Global
Debenture. (a) Whenever the Book-Entry Depositary shall receive from the
Indenture Trustee (or other paying agent under the Indenture) any payment on the
Global Debenture, such payments shall be distributed promptly to the
Institutional Trustee on behalf of the Trust and following a Trust dissolution
to the Depositary on the payment date for such Global Debenture. Where DTC is
the Depositary, such payments shall be made in accordance with the Letter of
Representations.
(b) The Book-Entry Depositary will forward to the Company or its agents
such information from its records as the Company may reasonably request in
writing to enable the Company or its agents to file necessary reports with
governmental agencies, and the Book-Entry Depositary, the Company or their
agents may (but shall not be required to) file any such reports necessary to
obtain benefits under any applicable tax treaties for the Depositary of, or the
beneficial owners of Interests in, the Book-Entry Interests.
(c) Notwithstanding any other provisions of this Agreement, the
Book-Entry Depositary shall be required to pay to the Institutional Trustee on
behalf of the Trust and following a Trust dissolution to the Depositary only
amounts (including Additional Amounts, Additional Sums and Additional Interests
(as defined in the Indenture)) received by the Book-Entry Depositary under the
Global Debenture.
(d) Neither the Company nor any agent of the Company will have any
responsibility or liability for any aspect relating to payments made or to be
made by the Book-Entry Depositary to the Institutional Trustee on behalf of the
Trust and following a Trust dissolution to the Depository in respect of the
Global Debenture or the Book-Entry Interests. None of the Company, the Indenture
Trustee, the Book-Entry Depositary or any agent of any of the foregoing will
have any responsibility or liability for any aspect relating to payments made or
to be made by DTC on account of a Participant's or Indirect Participant's
ownership of an Interest in the Book-Entry Interest or CDI or for maintaining,
supervising or reviewing any records relating to a Participant's or an Indirect
Participant's Interests in a Book-Entry Interest.
SECTION 2.07. Change in Principal Amount of the Global Debenture.
Whenever the principal amount at maturity of the Global Debenture held by the
Book-Entry Depositary is changed by the Indenture Trustee, the Book-Entry
Depositary shall notify the Depositary of the corresponding change in the
principal amount of the related Book-Entry Interest or CDI.
SECTION 2.08. Record Date. Whenever any payment is to be made in
respect of the Global Debenture or the Book-Entry Depositary shall receive
notice of any action to be taken by the Depositary of the Global Debenture or
Depositary of CDIs, or whenever the Book-Entry Depositary otherwise deems it
appropriate in respect of any other matter, the Book-Entry Depositary shall fix
a record date for the determination of the Depositary who shall be entitled to
receive payment in respect of such Book-Entry Interest or to take any such
action or to act in respect of any such matter. Subject to the provisions of
this Agreement, only the Depositary who is registered on the Book-Entry Register
at the close of business on such record date shall be entitled to receive any
such payment, to give instructions as to such action or to act in respect of any
such matter.
SECTION 2.09. Action in Respect of a Book-Entry Interest or the Global
Debenture. (a) As soon as practicable after receipt by the Book-Entry Depositary
of notice of any solicitation of consents or request for a waiver or other
action by the Depositary or owners of Interests under this Agreement or the
Indenture, the Book-Entry Depositary shall mail to the Institutional Trustee or
following the dissolution of the Trust to the Depositary a notice containing (i)
such information as is contained in such notice, (ii) a statement that the
Institutional Trustee or Depositary at the close of business on a specified date
will be entitled, subject to the provisions of or governing such Book-Entry
Interest, CDI or Global Debenture, as the case may be, to instruct the
Book-Entry Depositary as to the consent, waiver or other action, if any,
pertaining to such Book-Entry Interest, CDI or Global Debenture, as the case may
be, and (iii) a statement as to the manner in which such instructions may be
given. Upon the written request of the Institutional Trustee or following the
dissolution of the Trust to the Depositary received on or before the date
established by the Book-Entry Depositary for such purpose, the Book-Entry
Depositary shall endeavor insofar as practicable and permitted under the
provisions of or governing such Book-Entry Interest, CDI or Global Debenture, as
the case may be, to take such action regarding the requested consent, waiver or
other action in respect of such Book-Entry Interest or Global Debenture, as the
case may be, in accordance with any instructions set forth in such request. The
Book-Entry Depositary shall not itself exercise any discretion in the granting
of consents or waivers or the taking of any other action in respect of such
Book-Entry Interest or Global Debenture.
(b) The Institutional Trustee or following the dissolution of
the Trust the Depositary may direct the time, method and place of conducting any
proceeding for any remedy available to the Book-Entry Depositary or of
exercising any trust or power conferred on the Book-Entry Depositary. However,
the Book-Entry Depositary may refuse to follow any direction that conflicts with
law or this Agreement or the Indenture or, subject to Section 3.01 hereof, that
the Book-Entry Depositary determines would involve it in Personal liability.
SECTION 2.10. Surrender of the Global Debenture. In the event of the
redemption, payment or purchase in full of all the Subordinated Debentures
represented by the Global Debenture, then such Global Debenture shall become
void and the Book-Entry Depositary shall surrender such Global Debenture to the
Trustee for cancellation.
SECTION 2.11. Reports. The Book-Entry Depositary shall immediately (and
in no event later than 10 days from receipt) send to the Institutional Trustee
or following the dissolution of the Trust to the Depositary a copy of any
notices, reports and other communications received by it relating to the
Company, the Subordinated Debentures, CDIs or the Book-Entry Interests.
SECTION 2.12. Additional Amounts. In accordance with the Indenture, all
payments made by the Book-Entry Depositary pursuant to this Agreement shall be
made without deduction or withholding for, or on account of, any present or
future taxes, duties, assessments or governmental charges of whatever nature
(collectively, "United Kingdom Taxes") imposed or levied by or on behalf of the
United Kingdom or any political subdivision thereof or any authority therein or
thereof having power to tax therein (each a "U.K. Tax Authority"), unless the
withholding or deduction of such United Kingdom Taxes is then required by law.
At least 10 days prior to the first interest payment date, and at least
10 days prior to each succeeding interest payment date if there has been any
change with respect to the matters set forth in the below-mentioned Directors'
Certificate, the Company will furnish the Book-Entry Depositary with a
Directors' Certificate instructing the Book-Entry Depositary whether such
payment of principal of or interest on such Book-Entry Interest shall be made to
the Institutional Trustee or following the dissolution of the Trust to the
Depositary without deduction or withholding for or on account of any United
Kingdom Taxes. If any such deduction or withholding shall be required, prior to
such interest payment date the Company will furnish the Book-Entry Depositary
with a Directors' Certificate which specifies the amount required to be deducted
or withheld on such payment. Neither the Company nor any agent of the Company
will have any responsibility or liability for any aspect relating to payments
made or to be made by the Book-Entry Depositary to the Institutional Trustee or
following the dissolution of the Trust to Depositary in respect of the
Subordinated Debentures, CDIs or the Book-Entry Interests. None of the Company,
the Indenture Trustee, the Book-Entry Depositary or any agent of any of the
foregoing will have any responsibility or liability for any aspect relating to
payments made or to be made by DTC on account of a Participant's or Indirect
Participant's ownership of an interest in the Book-Entry Interests or CDIs or
for maintaining, supervising or reviewing any records relating to a
Participant's or Indirect Participant's interests in the Book-Entry Interests.
The Company shall indemnify the Book-Entry Depositary, its officers, directors
and employees for, and hold it harmless against, any loss, liability or expense
reasonably incurred without negligence, willful misconduct or bad faith on its
part arising out of or in connection with actions taken or omitted by it in
reliance on any Directors' Certificate furnished to it pursuant to this Section
2.12 including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder.
The indemnity provided by the Company in this Section 2.12 shall survive
the satisfaction and discharge of this Agreement.
ARTICLE III
The Book-Entry Depositary
SECTION 3.01. Certain Duties and Responsibilities. (a) The Book-Entry
Depositary undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement, and no implied covenants or
obligations shall be read into this Agreement against the Book-Entry Depositary.
(b) In the absence of bad faith on its part, the Book-Entry
Depositary may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Book-Entry Depositary and conforming to the requirements of
this Agreement, but in the case of any such certificates or opinions which by
any provision hereof are specifically required to be furnished to the Book-Entry
Depositary, the Book-Entry Depositary shall examine the same to determine
whether or not they conform to the requirements of this Agreement.
(c) No provision of this Agreement shall be construed to
relieve the Book-Entry Depositary from liability for its own negligent action,
its own negligent failure to act or its own willful misconduct, except that:
(i) the Book-Entry Depositary shall not be liable for
any error of judgment made in good faith by a Responsible Officer of
the Book-Entry Depositary, unless the Book-Entry Depositary was
negligent in ascertaining the pertinent facts; and
(ii) no provision of this Agreement shall require the
Book-Entry Depositary to spend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if
repayment of such funds or adequate indemnity against such risk or
liability satisfactory to the Book-Entry Depositary has not been
assured to it.
(d) The Book-Entry Depositary shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Institutional Trustee or following the dissolution of
the Trust the Depositary relating to the time, method and place of conducting
any proceeding for any remedy available to the Book-Entry Depositary, or
exercising any power conferred upon the Book-Entry depositary, under this
Agreement or the Indenture.
(e) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Book-Entry Depositary shall be subject to the
provisions of this Section 3.01.
SECTION 3.02. Notice of Default. Within 90 days after the occurrence of
any Event of Default with respect to the Global Debenture (a "Debenture
Default") of which a Responsible Officer of the Book-Entry Depositary assigned
to its corporate trust department has actual knowledge, the Book-Entry
Depositary shall transmit by mail to the Institutional Trustee or Depositary in
the manner provided in Section 4.02 hereof, notice of such Debenture Default,
unless such Debenture Default shall have been cured or waived.
SECTION 3.03. Certain Rights of Book-Entry Depositary. Subject to the
provisions of Section 3.01 hereof:
(a) the Book-Entry Depositary may rely and shall be protected
in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Directors' Certificate or Company
Order or as otherwise expressly provided herein and any resolution of
the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) the Book-Entry Depositary may consult with counsel, and
the written advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(d) the Book-Entry Depositary shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Book-Entry Depositary,
in its discretion, may make further inquiry or investigation into such
facts or matters as it may see fit, and, if the Book-Entry Depositary
shall determine to make such further inquiry or investigation, it shall
be entitled upon reasonable prior request and during normal business
hours to examine the books, records and premises of the Company,
Personally or by agent or attorney;
(e) the Book-Entry Depositary may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys, but the Book-Entry Depositary shall be
responsible for any misconduct or negligence on the part of any such
agent or attorney appointed by it hereunder;
(f) the Book-Entry Depositary shall be under no obligation to
expend or risk its own funds or to exercise, at the request or
direction of the Depositary, any of the rights or powers vested in it
by this Agreement or the Indenture unless the Depositary shall have
offered to the Book-Entry Depositary security or indemnity satisfactory
to the Book-Entry Depositary against the costs, expenses and
liabilities that might be incurred by it in compliance with such
request or direction;
(g) whenever in the administration of its duties under this
Agreement the Book-Entry Depositary shall deem it desirable that a
matter be proved or established prior to taking or suffering or
omitting any action hereunder, the Book-Entry Depositary (unless other
evidence be herein specifically prescribed) may, in the absence of
negligence or bad faith on its part, rely upon a Directors'
Certificate.
SECTION 3.04. Not Responsible for Recitals or Issuance of Subordinated
Debentures. The recitals contained in the Indenture and in the Subordinated
Debentures, except the Trustee's certificates of authentication, shall be taken
as the statements of the Company and the Book-Entry Depositary assumes no
responsibility for their correctness. The Book-Entry Depositary makes no
representations as to the validity or sufficiency of this Agreement or of the
Subordinated Debentures. The Book-Entry Depositary shall not be accountable for
the use or application by the Company of the proceeds with respect to the
Subordinated Debentures.
SECTION 3.05. Money Held in Trust. Money held by the Book-Entry
Depositary in trust hereunder need not be segregated from other funds held by
the Book-Entry Depositary, except to the extent required by law. The Book-Entry
Depositary shall be under no obligation to invest or pay interest on any money
received by it hereunder, except as otherwise agreed in writing with the
Company. Any interest accrued on funds deposited with the Book-Entry Depositary
under this Agreement shall be paid to the Company from time to time and the
Depositary shall have no claim to any such interest.
SECTION 3.06. Compensation and Reimbursement. The Company agrees:
(a) to pay to the Book-Entry Depositary from time to time such
compensation as is agreed upon in writing;
(b) except as otherwise expressly provided herein, to reimburse
the Book-Entry Depositary upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Book-Entry Depositary in accordance with any provision of this
Agreement (including the reasonable compensation and the reasonable
expenses and disbursements of its agents and counsel, which
compensation, expenses and disbursements shall be set forth in
sufficient written detail to the satisfaction of the Company), except
any such expense, disbursement or advance as may be attributable to
its or their negligence or bad faith; and
(c) to indemnify the Book-Entry Depositary for, and to hold it
harmless against, any loss, liability or expense incurred without
negligence, bad faith or willful misconduct on its part arising out of
or in connection with the acceptance or administration of this
Agreement and the performance of its duties hereunder, including the
costs and expenses of defending itself against any claim of liability
in connection with the exercise or performance of any of its powers or
duties hereunder. The indemnity provided by this Section 3.06(c) shall
survive the satisfaction and discharge of this Agreement pursuant to
Section 4.11 hereof.
SECTION 3.07. Book-Entry Depositary Required; Eligibility. At all times
when there is a Book-Entry Depositary hereunder, such Book-Entry Depositary
shall be a corporation organized and doing business under the laws of the United
States of America, any state thereof or the District of Columbia, having,
together with its parents, a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal, state or District
of Columbia authority and willing to act on reasonable terms. Such corporation
shall have its principal place of business in the Borough of Manhattan, The City
of New York, if there be such a corporation in such location willing to act upon
reasonable and customary terms and conditions. If such corporation, or its
parent, publishes reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then for
the purposes of this Section 3.07, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Book-Entry Depositary
hereunder shall at all times be the Trustee under the Indenture, subject to
receipt of an Opinion of Counsel that the same Person is precluded by law from
acting in such capacities. If at any time the Book-Entry Depositary shall cease
to be eligible in accordance with the provisions of this Section 3.07, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
SECTION 3.08. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Book-Entry Depositary and no appointment of a
successor Book-Entry Depositary pursuant to this Article shall become effective
until (i) the acceptance of appointment by the successor Book-Entry Depositary
in accordance with the applicable requirements of Section 3.09 hereof or (ii)
the issuance of Definitive Registered Debentures in accordance with Section 2.04
or Section 2.05 hereof and the Indenture.
(b) The Book-Entry Depositary may resign with respect to the Global
Debenture by giving written notice thereof to the Company and the Depositary, in
accordance with Section 4.01 and Section 4.02 hereof, 60 days prior to the
effective date of such resignation. The Book-Entry Depositary may be removed at
any time upon 90 days' notice by the filing with it of an instrument in writing
signed on behalf of the Company and specifying such removal and the date when it
is intended to become effective. If the instrument of acceptance by a successor
Book-Entry Depositary required by Section 3.09 hereof shall not have been
delivered to the Book-Entry Depositary within 30 days after the giving of such
notice of resignation or removal, the resigning Book-Entry Depositary may
petition any court of competent jurisdiction for the appointment of a successor
Book-Entry Depositary.
(c) If at any time:
(i) the Book-Entry Depositary shall cease to be eligible under Section
3.07 hereof, or shall cease to be eligible as Trustee under the
Indenture, and shall fail to resign after written request therefor by
the Company or by the Depositary, or
(ii) the Book-Entry Depositary shall become incapable of acting with
respect to a Book-Entry Interest or shall be adjudged a bankrupt or
insolvent, or a receiver or liquidator of the Book-Entry Depositary or
of its property shall be appointed or any public officer shall take
charge or control of the Book-Entry Depositary or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company, by Board Resolution, may remove the
Book-Entry Depositary and appoint a successor Book-Entry Depositary, and (ii) if
the Company shall fail to remove such Book-Entry Depositary and appoint a
successor Book-Entry Depositary, the Depositary may, on behalf of itself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Book-Entry Depositary or Book-Entry Depositaries and the
appointment of a successor Book-Entry Depositary, unless Definitive Registered
Debentures have been issued in accordance with the Indenture.
(d) If the Book-Entry Depositary shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Book-Entry
Depositary for any cause, the Company, by Board Resolution, shall promptly
appoint a successor Book-Entry Depositary (other than the Company) and shall
comply with the applicable requirements of Section 3.09 hereof. If no successor
Book-Entry Depositary with respect to the Global Debenture shall have been so
appointed by the Company and accepted appointment in the manner required by
Section 3.09, the Depositary may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Book-Entry Depositary unless Definitive Registered Debentures have
been issued in accordance with the Indenture.
(e) The Company shall give, or shall cause such successor Book-Entry
Depositary to give, notice of each resignation and each removal of a Book-Entry
Depositary and each appointment of a successor Book-Entry Depositary to the
Depositary in accordance with Section 4.02 hereof. Each notice shall include the
name of the successor Book-Entry Depositary and the address of its Corporate
Trust Office.
SECTION 3.09. Acceptance of Appointment by Successor. (a) In case of
the appointment hereunder of a successor Book-Entry Depositary, every such
successor Book-Entry Depositary so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Book-Entry Depositary an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Book-Entry Depositary shall become effective and such successor
Book-Entry Depositary, without any further act, deed or conveyance, shall become
vested with all the rights, powers, agencies and duties of the retiring
Book-Entry Depositary, with like effect as if originally named as Book-Entry
Depositary hereunder; but, on the request of the Company or the successor
Book-Entry Depositary, such retiring Book-Entry Depositary shall, upon payment
of all amounts due and payable to it pursuant to Section 3.06 hereof, execute
and deliver an instrument transferring to such successor Book-Entry Depositary
all the rights and powers of the retiring Book-Entry Depositary and shall duly
assign, transfer and deliver to such successor Book-Entry Depositary all
property and money held by such retiring Book-Entry Depositary hereunder. Any
retiring Book-Entry Depositary shall, nonetheless, retain a prior claim upon all
property or funds held or collected by such Book-Entry Depositary to secure any
amounts then due it pursuant to Section 3.06 hereof.
(b) Upon request of any such successor Book-Entry Depositary, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Book-Entry Depositary all such
rights, powers and agencies referred to in paragraph (a) of this Section 3.09.
(c) No successor Book-Entry Depositary shall accept its appointment
unless at the time of such acceptance such successor Book-Entry Depositary shall
be eligible under this Article.
(d) Upon acceptance of appointment by any successor Book-Entry
Depositary as provided in this Section 3.09, the Company shall give notice
thereof to the Depositary in accordance with Section 4.02 hereof. If the
acceptance of appointment is substantially contemporaneous with the resignation
of the Book-Entry Depositary, then the notice called for by the preceding
sentence may be combined with the notice called for by Section 3.08(b) hereof.
If the Company fails to give such notice within 10 days after acceptance of
appointment by the successor Book-Entry Depositary, the successor Book-Entry
Depositary shall cause such notice to be given at the expense of the Company.
SECTION 3.10. Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Book-Entry Depositary may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Book-Entry Depositary
shall be a party, or any corporation succeeding to all or substantially all the
corporate trust business of the Book-Entry Depositary, shall be the successor of
the Book-Entry Depositary hereunder, without the execution or filing or any
paper or any further act on the part of any of the parties hereto.
ARTICLE IV
Miscellaneous Provisions
SECTION 4.01. Notices to Book-Entry Depositary or Company. Any request,
demand, authorization, direction, notice, consent, or waiver or other document
provided or permitted by this Agreement to be made upon, given or furnished to,
or filed with,
(a) the Book-Entry Depositary by the Depositary, by the Institutional
Trustee, by the Trustee or the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and Personally delivered or
mailed, first-class postage prepaid, to the Book-Entry Depositary at is
Corporate Trust Office, Attention: Corporate Trust and Agency Group ,
or at any other address previously furnished in writing by the
Book-Entry Depositary to the Depositary by the Institutional Trustee,
the Trustee and the Company, or
(b) the Company, by the Book-Entry Depositary or by the Depositary
shall be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if made, given, furnished or filed in
writing and personally delivered or mailed, first-class postage prepaid
to Southern Investments UK plc, Attention: Chief Financial Officer,
Southern Energy, Inc., 900 Ashwood Parkway, Suite 500, Atlanta, Georgia
30338,or at any other address previously furnished in writing to the
Book-Entry Depositary by the Company.
SECTION 4.02. Notice to Depositary; Waiver. Where this Agreement
provides for notice to the Depositary of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided or as provided in
the Letter of Representations) if in writing and mailed, first-class postage
prepaid, to the Depositary at the address notified to the Book-Entry Depositary,
in each case not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. Where this Agreement provides
for notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by the
Depositary shall be filed with the Book-Entry Depositary, but such filing shall
not be a condition precedent to the validity of any action taken in reliance
upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Book-Entry
Depositary shall constitute a sufficient notification for every purpose
hereunder.
SECTION 4.03. Effect of Headings and Table of Contents. The Article and
Section headings herein are for convenience only and shall not affect the
construction hereof.
SECTION 4.04. Successors and Assigns. All covenants and agreements in
this Agreement and the Subordinated Debentures by the Company shall bind its
successors and assigns, whether so expressed or not.
SECTION 4.05. Separability Clause. In case any provision in this
Agreement or in the Subordinated Debentures shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions hereof and thereof shall not in any way be affected or impaired
thereby.
SECTION 4.06. Benefits of Agreement. Nothing in this Agreement, the
Subordinated Debentures, the Indenture or the Declaration of Trust, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, any benefits or any legal or equitable right, remedy or
claim under this Agreement. The Depositary and owners from time to time of
Interests in the Book-Entry Interests shall be parties to this Agreement and
shall be bound by all of the terms and conditions hereof and of the Indenture
and the Subordinated Debentures, by their acceptance of delivery of the
Interests.
SECTION 4.07. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK 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.
SECTION 4.08. Jurisdiction. The Company agrees that any legal suit,
action or proceeding against the Company brought by the Book-Entry Depositary
arising out of or based upon this Agreement may be instituted in any state or
Federal court in the Borough of Manhattan, The City of New York, and waives any
objection which it may now or hereafter have to the laying of venue of any such
proceeding and irrevocably submits to the nonexclusive jurisdiction of such
courts in any suit, action or proceeding. The Company has appointed CT
Corporation System, 1633 Broadway, New York, New York 10019, as its authorized
agent (the "Authorized Agent") upon whom process may be served in any legal
suit, action or proceeding arising out of or based upon this Agreement which may
be instituted in any New York state or Federal court sitting in the Borough of
Manhattan in New York City by the Depositary or the Book-Entry Depositary, and
expressly accepts the nonexclusive jurisdiction of any such court in respect of
any such action. Such appointment shall be irrevocable. Service of process upon
the Authorized Agent shall be deemed, in every respect, effective service of
process upon the Company. Notwithstanding the foregoing, any action based on
this Agreement may be instituted by the Book-Entry Depositary in any competent
court in England.
SECTION 4.09. Counterparts. This Agreement may be executed in any
number of counterparts by the parties hereto on separate counterparts, each of
which, when so executed and delivered, shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
SECTION 4.10. Inspection of Agreement. A copy of this Agreement shall
be available at all reasonable times during normal business hours at the
Corporate Trust Office of the Book-Entry Depositary for inspection by any
Depositary.
SECTION 4.11. Satisfaction and Discharge. This Agreement upon Company
Order shall cease to be of further effect, and the Book-Entry Depositary, at the
expense of the Company shall execute proper instruments acknowledging
satisfaction and discharge of this Agreement, when (i) the Indenture has been
satisfied and discharged pursuant to the provisions thereof or Definitive
Registered Debentures have been issued and the Global Debenture has been
canceled in accordance with the provisions of Section 2.05 hereof and the
Indenture, (ii) the Company has paid or caused to be paid all sums payable
hereunder by the Company and (iii) the Company has delivered to the Book-Entry
Depositary a Directors' Certificate and an Opinion of Counsel, stating that all
conditions precedent herein provided relating to the satisfaction and discharge
of this Agreement have been complied with.
SECTION 4.12. Amendments. The Company and the Book-Entry Depositary may
amend this Agreement without the consent of the Depositary:
(a) to cure any formal defect, omission, inconsistency or
ambiguity in this Agreement;
(b) to add to the covenants and agreements of the Company or the
Book-Entry Depositary;
(c) to effect the assignment of the Book-Entry Depositary's
rights and duties to a qualified successor, as provided herein;
(d) to comply with any requirements of the Securities Act, the
Exchange Act or the U.S. Investment Company Act of 1940, as amended,
and the Trust Indenture Act or any other applicable securities laws;
(e) to modify this Agreement in connection with an amendment to
the Indenture that does not require the consent of the Depositary; or
(f) to modify, alter, amend or supplement this Agreement in any
other respect not inconsistent with this Agreement which, in the
opinion of counsel acceptable to the Company, is not materially
adverse to the Depositary.
Except as set forth in this Section 4.12, no amendment which materially
adversely affects any Depositary or beneficial owner of Interests may be made to
this Agreement without the consent of such Depositary or beneficial owner.
SECTION 4.13. Book-Entry Depositary To Sign Amendments. The Book-Entry
Depositary shall sign any amendment authorized pursuant to Section 4.12 if the
amendment does not materially adversely affect the rights, duties, liabilities
or immunities of the Book-Entry Depositary. If it does, the Book-Entry
Depositary may but need not sign it.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first written above.
SOUTHERN INVESTMENTS UK plc
By:
Name:
Title:
BANKERS TRUST COMPANY, as
Book-Entry Depositary,
By:
Name:
Title: