1
EXHIBIT 5.3
====================================
THIRD SUPPLEMENTAL INDENTURE
Dated as of March 19, 1997
between
MCN CORPORATION,
AS ISSUER
and
NBD BANK
AS TRUSTEE
=====================================
2
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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.2. Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.3. Form and Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.4. Global Debenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.5. Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 2.6. Sinking Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE III
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 3.1. Extension of Interest Payment Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 3.2. Notice of Extension . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 3.3. Limitation of Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 3.4. Optional Repayment of Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 3.5. Repayment Procedure for Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE IV
EXPENSES
SECTION 4.1. Payment of Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4.2. Payment Upon Resignation or Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE V
NOTICE
SECTION 5.1. Notice by the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VI
FORM OF DEBENTURE
SECTION 6.1. Form of Debenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VII
ORIGINAL ISSUE OF DEBENTURES
SECTION 7.1. Original Issue of Debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
i
3
Page
----
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Ratification of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.2. Trustee Not Responsible for Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.3. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.4. Separability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 8.5. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ii
4
THIRD SUPPLEMENTAL INDENTURE, dated as of March 19, 1997 (the "Third
Supplemental Indenture"), between MCN Corporation, a corporation duly organized
and existing under the laws of the State of Michigan, having its principal
office at 500 Griswold Street, Detroit, Michigan 48226 and doing business as
MCN Energy Group Inc., (the "Company"), and NBD Bank, a Michigan banking
corporation, as trustee (the "Trustee").
WHEREAS, the Company executed and delivered the indenture dated as
of September 1, 1994 (the "Base Indenture") as supplemented by a first
supplemental indenture, dated April 17, 1996 (the "First Supplemental
Indenture") and the second supplemental indenture (the "Second Supplemental
Indenture"), dated July 24, 1996, (the Base Indenture as so supplemented the
"Indenture"), to the Trustee to provide for the future issuance of the
Company's unsecured debentures, notes or other evidence of indebtedness (the
"Securities"), to be issued from time to time in one or more series as might be
determined by the Company under 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 7-1/4% Junior Subordinated Debentures due 2002 (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 Third
Supplemental Indenture;
WHEREAS, MCN Financing III, a Delaware statutory business trust (the
"Trust"), has offered to the public $132,250,000 million aggregate liquidation
amount of its 7-1/4% Trust Originated Preferred Securities (the "Preferred
Securities"), representing preferred 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 $4,090,250 million aggregate liquidation amount of its 7-1/4% Trust
Originated Common Securities, representing common undivided beneficial
interests in the assets of the Trust (the "Common Securities" and together with
the Preferred Securities, the "Trust Securities"), in $136,340,250 million
aggregate principal amount of the Debentures; and
WHEREAS, the Company has requested that the Trustee execute and
deliver this Third Supplemental Indenture,
5
and all requirements necessary to make this Third 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 Third 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 Third Supplemental Indenture;
(b) a term defined anywhere in this Third Supplemental Indenture
has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) headings are for convenience of reference only and do not
affect interpretation;
(e) 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) Preferred Security
Certificate; (vii) Preferred Security Guaranty; (viii) Pricing Agreement; (ix)
Institutional Trustee; (x) Regular Trustees; (xi) Special Event; (xii) Tax
Event; (xiii) Investment Company Event; and (xiv) Underwriting Agreement;
(f) the following terms have the meanings given to them in this
Section 1.1(f):
2
6
"Additional Interest" shall have the meaning set forth in Section
2.5.
"Compounded Interest" shall have the meaning set forth in Section
3.1.
"Coupon Rate" shall have the meaning set forth in Section 2.5.
"Debentures Repayment Price" shall have the meaning set forth in
Section 3.5.
"Declaration" means the Amended and Restated Declaration of Trust of
MCN Financing III, a Delaware statutory business trust, dated as of March 19,
1997.
"Deferred Interest" shall have the meaning set forth in Section 3.1.
"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.
"Extended Interest Payment Period" shall have the meaning set forth
in Section 3.1.
"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.
"Put Option Exercise Date" shall have the meaning set forth in
Section 3.4.
"Purchase Contract Agreement" means the Purchase Contract Agreement,
dated as of March 25, 1997 among the
3
7
Company and The First National Bank of Chicago, as purchase contract agent (the
"Purchase Contract Agent").
(g) the following terms have the meaning given to them in the
Purchase Contract Agreement: (i) Cash Settlement; (ii) Collateral Agent; (iii)
Collateral Settlement; (iv) Early Settlement Date; (v) Pledge Agreement; (vi)
Purchase Contract; and (vii) Purchase Contract Settlement Date.
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
"7-1/4% Junior Subordinated Debentures due 2002", limited in aggregate principal
amount to $136,340,250 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 303 of the Indenture.
SECTION 2.2. Maturity. The Maturity Date will be May 16, 2002.
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 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
Institutional 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 or the Collateral
Agent, the payment of the principal of and interest (including Compounded
Interest and Additional Interest, if any) on such Debentures held by the
Institutional Trustee or the Collateral Agent will be made at such place and to
such account as may be designated in writing by the Institutional Trustee or
the Collateral Agent, as the case may be, prior to such payment.
4
8
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 Institutional 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 Third 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
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 Third Supplemental Indenture. On
issue of such Debentures, Debentures with an equivalent aggregate
principal amount that were presented by the Institutional
5
9
Trustee to the Trustee will be deemed to have been cancelled.
(b) Unless and until it is exchanged for the Debentures in
registered form, 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 Global
Debenture. In such event the Company will execute, and subject to Section 301
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.
6
10
SECTION 2.5. Interest.
(a) Each Debenture will bear interest at the rate of 7-1/4% 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 IV) quarterly in
arrears on March 31, June 30, September 30 and December 31 of each year (each,
an "Interest Payment Date," commencing on June 30, 1997), 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 (i) Debentures of which the Institutional Trustee is the
Holder and the Preferred Securities are in book-entry only form or (ii) a
Global Debenture, shall be the close of business on the Business Day next
preceding that Interest Payment Date. Notwithstanding the foregoing sentence,
if (i) the Debentures are held by the Institutional Trustee and the Preferred
Securities are no longer in book-entry only form or (ii) 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 per 30-day month. 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 or the
Collateral Agent is the Holder of any Debentures, the Trust or the
Institutional Trustee or the Collateral Agent is required to pay any taxes,
duties, assessments
7
11
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 or the Collateral Agent, such
additional amounts as shall be required so that the net amounts received and
retained by the Trust and the Institutional Trustee or the Collateral Agent
after paying such taxes, duties, assessments or other governmental charges will
be equal to the amounts the Trust and the Institutional Trustee or the
Collateral Agent would have received had no such taxes, duties, assessments or
other government charges been imposed.
SECTION 2.6. Sinking Fund.
The Debentures are not entitled to the benefit of any sinking fund.
ARTICLE III
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 3.1. 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 extending
beyond the date of maturity of the Debentures (the "Extended Interest Payment
Period"), during which Extended Interest Payment Period no interest shall be
due and payable. 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 3.1, 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
8
12
with all such previous and further extensions thereof shall not exceed 20
consecutive quarters or extend beyond the maturity date of the Debentures.
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 3.2. Notice of Extension.
(a) If the Institutional Trustee or the Collateral Agent 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, the Collateral Agent, 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 or the Collateral Agent 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 at least 10 Business Days before the next succeeding Interest
Payment Date.
(c) The quarter in which any notice is given pursuant to paragraphs
(a) or (b) of this Section 3.2 shall be counted as one of the 20 quarters
permitted in the maximum Extended Interest Payment Period permitted under
Section 3.1.
9
13
SECTION 3.3. Limitation of Transactions.
If (i) the Company shall exercise its right to defer payment of
interest as provided in Section 4.1, then (a) the Company shall not declare or
pay any dividends on, make any distributions with respect to, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its
capital stock (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 outstanding on the date of
such event requiring the Company to purchase shares of its common stock, (ii)
as a result of a reclassification of its capital stock or the exchange or
conversion of one class or series 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) or make any
guarantee payment with respect thereto, (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 and (c) the Company shall not make any guarantee
payments with respect to the foregoing (other than pursuant to the Preferred
Security Guaranty).
SECTION 3.4. Optional Repayment of Debentures.
Each Holder of Debentures, including the Institutional Trustee and
the Collateral Agent, shall have the right (the "Put Option") to require the
Company to repay all or a portion (which portion must be $50 or any integral
multiple thereof) of the Debentures held by such Holder, on May 16, 2000, the
Purchase Contract Settlement Date (the "Put Option Exercise Date"), at a
repayment price equal to 100% of the principal amount thereof plus any accrued
and unpaid interest thereon, including Additional Interest, if any, to the date
of such repayment (the "Debentures Repayment Price").
SECTION 3.5. Repayment Procedure for Debentures.
(a) In order for the Debentures to be repaid on the Put Option
Exercise Date, the Company must receive at the Corporate Trust Office of the
Trustee in the City of
10
14
Detroit, Michigan, not less than 10 nor more than 30 days prior to the Put
Option Exercise Date, the Debentures to be repaid with the form entitled
"Option to Elect Repayment" on the reverse of or otherwise accompanying such
Debentures duly completed. Any such notice received by the Company shall be
irrevocable. All questions as to the validity, eligibility (including time of
receipt) and acceptance of the Debentures for repayment shall be determined by
the Company, whose determination shall be final and binding. Notwithstanding
the foregoing, so long as the Holder is the Institutional Trustee or the
Collateral Agent, and assuming prior notice to the Trustee, such Debentures may
be received at the Corporate Trust Office (as defined in the Declaration) of
the Institutional Trustee in the City of Wilmington, Delaware at any time prior
to 11:00 a.m., New York City time, on the Put Option Exercise Date in the form
and manner as may be designated by the Institutional Trustee or the Collateral
Agent and acceptable to the Trustee.
(b) Payment of the Debentures Repayment Price to Holders of
Debentures shall be made through the Trustee, subject to the Trustee's receipt
of payment from the Company in accordance with the terms of the Indenture.
Notwithstanding the foregoing, so long as the Holder of any Debentures
presented for repayment is the Institutional Trustee or the Collateral Agent,
the payment of the Debentures Repayment Price in respect of such Debentures
shall be made, either through the Trustee or the Company acting as Paying
Agent, no later than 12:00 noon, New York City time, on the Put Option Exercise
Date, by check or wire transfer, in immediately available funds, at such place
and to such account as may be designated by the Institutional Trustee or the
Collateral Agent, as the case may be. If the Trustee holds immediately
available funds sufficient to pay the Debentures Repayment Price of the
Debentures presented for repayment (or, if the Company is acting as Paying
Agent or the Institutional Trustee has received the Debentures Repayment
Price), then, immediately prior to the close of business on the Put Option
Exercise Date, such Debentures will cease to be outstanding and interest
thereon will cease to accrue, whether or not such Debentures have been received
by the Company, and all other rights of the Holder in respect of the
Debentures, including the Holder's right to require the Company to repay such
Debentures, shall terminate and lapse (other than the right to receive the
Debentures Repayment Price upon delivery of such Debentures but without
interest on such Debentures Repayment Price). Neither the
11
15
Institutional Trustee nor the Company will be required to register or cause to
be registered the transfer of any Debentures for which repayment has been
elected.
ARTICLE IV
EXPENSES
SECTION 4.1. 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 the Pricing Agreement and
compensation of the Trustee under the Indenture in accordance with the
provisions of Section 607 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.
12
16
SECTION 4.2. Payment Upon Resignation or Removal.
Upon termination of this Third Supplemental Indenture or the
Indenture or the removal or resignation of the Trustee pursuant to this Section
4.2, 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.
ARTICLE V
NOTICE
SECTION 5.1. 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 VI. Notwithstanding the
provisions of Article Fourteen of the Indenture or any other provision of the
Indenture and this Third 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 Article Fourteen of the Indenture,
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 601 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 Article 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
13
17
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 601 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 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 VI, 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 VI, 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.
ARTICLE VI
FORM OF DEBENTURE
SECTION 6.1. 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 Deposi-
14
18
tary 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, 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. __________________
$_____________________
CUSIP No. ____________
15
19
MCN CORPORATION
___% JUNIOR SUBORDINATED DEBENTURE
DUE 2002
MCN CORPORATION, a Michigan corporation (the "Company", doing
business as MCN Energy Group Inc., which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to ______________ or registered assigns, the principal
sum of _____________ Dollars ($___________) on ________, 2002, and to pay
interest on said principal sum from March __, 1997, 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, 1997, at the rate of ___% 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. 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 per 30-day month. 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
DEBEN-
16
20
TURES 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 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 or, if applicable, the Collateral Agent, 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 in writing by the
Institutional Trustee or, if applicable, the Collateral Agent.
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 pari passu in right of
payment with the Company's other junior subordinated debentures, 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
17
21
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.
18
22
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.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed.
Dated ___________________
MCN CORPORATION
By:
______________________________
Name:
Title
Attest:
By: _____________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series of Securities described
in the within-mentioned Indenture.
Dated ___________________ NBD BANK
as Trustee
By ______________________________
Authorized Signatory
19
23
(FORM OF REVERSE OF DEBENTURE)
This Debenture is one of a duly authorized series of Securities of
the Company (herein sometimes referred to as the "Securities"), specified in
the Indenture, all issued or to be issued in one or more series under and
pursuant to an Indenture dated as of September 1, 1994, duly executed and
delivered between the Company and NBD Bank, as Trustee (the "Trustee") (as
supplemented by a First Supplemental Indenture, dated April 17, 1996, and a
Second Supplemental Indenture, dated July 24, 1996, as so supplemented, the
"Base Indenture"), as supplemented by a Third Supplemental Indenture dated as
of March 19, 1997, between the Company and the Trustee (the Base 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 Securities. By the terms of the
Indenture, the Securities 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 Securities is limited in aggregate principal amount
as specified in said Third Supplemental Inden- ture.
The Debentures are not entitled to the benefit of any sinking fund.
The Holder of this Debenture, including the Institutional Trustee
or, if applicable, the Collateral Agent, shall have the right (the "Put
Option") to require the Company to repay all or a portion (which portion must
be $50 or any integral multiple thereof) of this Debenture on May 16, 2000, the
Purchase Contract Settlement Date (the "Put Option Exercise Date") at a
repayment price equal to 100% of the principal amount thereof plus any accrued
but unpaid interest, including Additional Interest, if any, to the date of such
repayment (the "Debentures Repayment Price"). In order for the Debentures to
be repaid on the Put Option Exercise Date, the Company must receive at the
Corporate Trust Office of the Trustee in the City of Detroit, Michigan, not
less than 10 nor more than 30 days prior to the Put Option Exercise Date, the
Debentures to be repaid with the form entitled "Option to Elect repayment"
hereon duly completed. Any such notice received by the Company shall be
irrevocable. All questions as to the validity, eligibility (including time of
receipt) and accep-
20
24
tance of the Debentures for repayment shall be determined by the Company, whose
determination shall be final and binding. Notwithstanding the foregoing, so
long as the Holder is the Institutional Trustee or the Collateral Agent, and
assuming prior notice to the Trustee, this Debenture may be received at the
Corporate Trust Office (as defined in the Declaration) of the Institutional
Trustee at any time prior to 11:00 a.m., New York City time, on the Put Option
Exercise Date in the form and manner as may be designated by the Institutional
Trustee or the Collateral Agent and acceptable to the Trustee.
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) change the Stated Maturity of the principal of, or any installment of
principal of or interest on, 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 Securities 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 Default or Event of Default with respect to such series, and its
consequences, except a Default or Event of Default in the payment of the
principal of or premium, if any, or interest
21
25
on any of the Securities of such series. Any 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
therefor 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.
So long as the Company is not in default in the payment of interest
on the Debentures, 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 a period not exceeding beyond the maturity date of the
Debentures (an "Extended Interest Payment Period"), at the end of which period
the Company shall pay all interest then accrued and unpaid (together with the
interest thereon at the rate specified for the Debentures to the extent that
payment of such interest is enforceable under applicable law). In the event
that the Company exercises this right, then (a) the Company shall not declare
or pay dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its capital
stock (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 outstanding on the date of such event
requiring the Company to purchase shares of the Company's Common Stock, (ii) as
a result of a reclassification of the Company's capital stock or the exchange
or conversion of one class or series of the Company's capital stock for another
class or series of the Company's capital stock or (iii) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged) or make any guarantee payments with respect to the
foregoing), (b) the Company shall not make any payment
22
26
of interest, principal or premium, if any, on or repay, repurchase or redeem
any debt securities (including guarantees) issued by the Company that rank pari
passu with or junior to such Debentures and (c) the Company shall not make any
guarantee payments with respect to the foregoing (other than pursuant to the
Preferred Securities Guarantee). Prior to the termination of any such Extended
Interest Payment Period, the Company may further extend the interest payment
period; provided, however, that such Extended Interest Payment Period, together
with all such previous and further extensions thereof, may not exceed beyond
the maturity date of the Debentures.
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 of Detroit and State of Michigan 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.
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,
23
27
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 Indenture imposes certain limitations on the ability of the
Company to, among other things, merge or consolidate with any other Person or
sell, assign, transfer or lease all or substantially all of its properties or
assets. All such covenants and limitations are subject to a number of
important qualifications and exceptions. The Company must report periodically
to the Trustee on compliance with the covenants in the Indenture.
The Debentures of this series are issuable only in registered form
without coupons in denominations of $50 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 $50 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations 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 VII
ORIGINAL ISSUE OF DEBENTURES
SECTION 7.1. Original Issue of Debentures.
Debentures in the aggregate principal amount of $136,340,250 may,
upon execution of this Third 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
24
28
Vice Chairman, its President, or any Vice President and its Treasurer,
Assistant Treasurer, Secretary or Assistant Secretary, without any further
action by the Company.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1. Ratification of Indenture.
The Indenture, as supplemented by this Third Supplemental Indenture,
is in all respects ratified and confirmed, and this Third Supplemental
Indenture shall be deemed part of the Indenture in the manner and to the extent
herein and therein provided.
SECTION 8.2. 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
Third Supplemental Indenture.
SECTION 8.3. Governing Law.
This Third 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 8.4. Separability.
In case any one or more of the provisions contained in this Third
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 Third
Supplemental Indenture or of the Debentures, but this Third Supplemental
Indenture and the Debentures shall be construed as if such invalid or illegal
or unenforceable provision had never been contained herein or therein.
25
29
SECTION 8.5. Counterparts.
This Third 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.
26
30
IN WITNESS WHEREOF, the parties hereto have caused this Third
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.
MCN CORPORATION
By /s/ Sebastian Coppola
----------------------------
Name: Sebastian Coppola
Title: Senior Vice President
and Treasurer
Attest:
By: /s/ Daniel L. Schiffer
--------------------------
Daniel L. Schiffer
Senior Vice President,
General Counsel and Secretary
NBD BANK
as Trustee
By /s/ James D. Khami
---------------------------
Name: James D. Khami
Title: Trust Officer
Attest:
By: /s/ Daniel T. Lis
------------------------
Daniel T. Lis