EXHIBIT 4(e)(10)
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture, unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the first series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series A, due
October 9, 2003" (the "Series A Bonds").
(2) The Series A Bonds shall be authenticated and delivered in the
aggregate principal amount of $850,000,000.
(3) Not applicable.
(4) The principal of all Series A Bonds shall be payable by the
Company in whole or in installments on such date or dates as the
Company has any obligations under the Credit Agreement, dated as of
October 10, 2002 (the "Credit Agreement"), among Citibank, N.A., as
syndication agent, JPMorgan Chase Bank, as administrative agent (the
"Administrative Agent") and the Banks from time to time parties
thereto, to repay any Loans (as defined in the Credit Agreement) to the
Banks (whether upon scheduled maturity, required prepayment,
acceleration, demand or otherwise), but not later than October 9, 2003.
The amount of principal of the Series A Bonds payable by the Company on
any such date shall equal the aggregate principal amount of the Loans
due and payable on such date pursuant to the Credit Agreement (but, in
no event, shall exceed the aggregate principal amount of the Series A
Bonds). The obligation of the Company to make any payment of the
principal on the Series A Bonds shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent that the Company has paid the principal then
due and payable on the Loans made pursuant to the Credit Agreement.
(5) The Series A Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment
Date (as hereinafter defined) on the Series A Bonds to equal the amount
of interest payable on such Interest Payment Date under the Credit
Agreement. Such interest on the Series A Bonds shall be payable on the
same dates as interest is payable from time to time pursuant to the
Credit Agreement (each such date herein called an "Interest Payment
Date"), until the maturity of the Series A Bonds, or, in the case of
any default by the Company in the payment of the principal due on the
Series A Bonds, until the Company's obligation with respect to the
payment of such principal shall be discharged as provided in the
Indenture. The amount of interest payable from time to time under the
Credit Agreement, the basis on which such interest is computed and the
dates on which such interest is payable are set forth in the Credit
Agreement. Each Series A Bond shall bear interest (a) from the date of
initial authentication of this Bond to but excluding the Interest
Payment Date next succeeding, and (b) from each Interest Payment Date
to but excluding the Interest Payment Date next succeeding. The
obligation of the Company to make any payment of interest on the Series
A Bonds shall be fully or partially, as the case may be, deemed to have
been paid or otherwise satisfied and discharged to the extent that the
Company has paid the interest on the Loans then due and payable
pursuant to the Credit Agreement.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of and interest on
the Series A Bonds shall be payable, (ii) registration of transfer of
the Series A Bonds may be effected, (iii) exchanges of the Series A
Bonds may be effected and (iv) notices and demands to or upon the
Company in respect of the Series A Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series A Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series A Bonds. The principal of the
Series A Bonds shall be payable without the presentment or surrender
thereof.
(7) Not applicable.
(8) Not applicable.
(9) The Series A Bonds are issuable only in denominations of
$850,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) See subsection (4) above.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
(17) The Series A Bonds shall be evidenced by a single registered
Series A Bond in the principal amount and denomination of Eight Hundred
Fifty Million Dollars ($850,000,000). The Series A Bonds shall be dated
October 10, 2002, shall mature no later than October 9, 2003, unless
sooner paid, and shall bear interest at the rate specified in
subsection (5) above. The Series A Bonds may be executed by the Company
and delivered to the Trustee for authentication and delivery. The
principal of and interest on the Series A Bonds shall be payable at the
Corporate Trust Office of the Trustee in Houston, Texas.
The single Series A Bond shall be identified by the number A-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Administrative Agent, on behalf of itself and the
Banks, and shall be transferable only as required to effect an
assignment thereof to a successor or an assign of the Administrative
Agent under the Credit Agreement and provided that all obligations of
the Administrative Agent under the Pledge Agreement (as defined below)
shall also be transferred to, and assumed by, any such successor or
assign. The Series A Bonds are to be issued to the Administrative Agent
as security for the payment by the Company of its Obligations (as
defined in the Pledge Agreement). The single Series A Bond shall be
held by the Administrative Agent subject to the terms of the Pledge
Agreement, dated as of October 10, 2002, between the Company and the
Administrative Agent (the "Pledge Agreement").
Series A Bonds issued upon transfer shall be numbered consecutively
from A-2 upwards and issued in the same $850,000,000 denomination but,
to the extent that the Loans are repaid, the registered holder thereof
shall duly note on the Series A Bonds like reduction in the amount of
principal in the Schedule of Prepayments to such Series A Bond and upon
any transfer of said Series A Bond, such Schedule of Prepayments shall
transfer to the subsequently issued Series A Bond. See also subsection
(19) below.
(18) Not applicable.
(19) The holder of the Series A Bond by acceptance of the Series A
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series A Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
series A Bonds, or any Tranche thereof; provided, however, that the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the exchange or
transfer.
(20) For purposes of the Series A Bonds, "Business Day" shall mean
a day other than a Saturday, Sunday or other day on which commercial
banks in New York City are authorized or required by law to close.
(21) Not Applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series A Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Administrative Agent,
signed by an authorized officer of the Administrative Agent and
attested by the Secretary or an Assistant Secretary of the
Administrative Agent within 90 days after the applicable Interest
Payment Date, stating that the payment of principal of or interest on
the Series A Bond has not been fully paid when due and specifying the
amount of funds required to make such payment.
The Series A Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series A Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
IN WITNESS WHEREOF, the undersigned has executed this Officer's
Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
--------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
EXHIBIT A
FORM OF SERIES A BOND
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT COLLATERAL TO A SUCCESSOR OR ASSIGN OF THE
ADMINISTRATIVE AGENT UNDER THE COLLATERAL AGREEMENT REFERRED TO HEREIN AMONG THE
COMPANY AND THE SEVERAL PARTIES THERETO.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series A, due October 9, 2003
<Table>
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes [ ] No [X]
Stated Maturity: October 9, 2003 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
</Table>
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
----------
Principal Amount
$850,000,000 No. A-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a limited liability company duly
organized and existing under the laws of the State of Texas (herein called the
"Company," which term includes any successor under the Indenture referred to
below), for value received, hereby promises to pay to JPMorgan Chase Bank, as
Administrative Agent (the "Administrative Agent"), or its registered assigns, on
behalf of itself and the Banks (as defined below), the principal sum of EIGHT
HUNDRED FIFTY MILLION DOLLARS, or such lesser principal amount as shall be equal
to the aggregate principal amount of Loans (as defined in the Credit Agreement
defined below) outstanding from time to time under the Credit Agreement (as
defined below), in whole or in installments on such date or dates as the Company
has any obligations under the Credit Agreement to repay any Loans to the Banks
(whether upon scheduled maturity, required prepayment, acceleration, demand or
otherwise), but not later than the Stated Maturity specified above. The amount
of principal of this Bond payable by the Company on any such date shall equal
the aggregate principal amount of the Loans due and payable on such date
pursuant to the Credit Agreement (but, in no event, shall exceed the principal
amount of this Bond). The obligation of the Company to make any payment of the
principal on this Bond shall be fully or partially, as the case may be, deemed
to have been paid or otherwise satisfied and discharged to the extent that the
Company has paid the principal then due and payable on the Loans made pursuant
to the Credit Agreement.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of interest payable on such Interest Payment Date under the Credit Agreement.
Such interest shall be payable on the same dates as interest is payable from
time to time in respect of the Loans pursuant to the Credit Agreement (each such
date herein called an "Interest Payment Date"), until the maturity of this Bond,
or, if the Company shall default in the payment of the principal due on this
Bond, until the Company's obligation with respect to the payment of such
principal shall be discharged as provided in the Indenture. The amount of
interest payable from time to time under the Credit Agreement, the basis on
which such interest is computed and the dates on which such interest is payable
are set forth in the Credit Agreement. This Bond shall bear interest (a) from
the date of initial authentication of this Bond to but excluding the Interest
Payment Date next succeeding, and (b) from each Interest Payment Date to but
excluding the Interest Payment Date next succeeding. The obligation of the
Company to make any payment of interest on this Bond shall be fully or
partially, as the case may be, deemed to have been paid or otherwise satisfied
and discharged to the extent that the Company has paid the interest on the Loans
then due and payable pursuant to the Credit Agreement.
This Bond is issued to the Administrative Agent by the Company pursuant to the
Company's obligations under the Credit Agreement, dated as of October 10, 2002
(as amended, supplemented, restated or otherwise modified from time to time, the
"Credit Agreement"), among the Company, Citibank, N.A., as Syndication Agent,
JPMorgan Chase Bank, as Administrative Agent, and the banks and other financial
institutions from time to time parties thereto (the "Banks"). This Bond shall be
held by the Administrative Agent subject to the terms of the Pledge Agreement,
dated as of October 10, 2002, between the Company, the Administrative Agent and
the Administrative Agent in such capacity under the Credit Agreement. Any
capitalized terms used herein and not defined herein shall have the meanings
specified in the Indenture (as defined below), unless otherwise noted.
The Administrative Agent shall surrender this Bond to the Trustee when all of
the principal of and interest on the Loans made pursuant to the Credit Agreement
shall have been duly paid and the Credit Agreement shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and
PROVIDED, FURTHER, that the Indenture permits the Trustee to enter into one or
more supplemental indentures for limited purposes without the consent of any
Holders of Securities. The Indenture also contains provisions permitting the
Holders of a majority in principal amount of the Securities then Outstanding, on
behalf of the Holders of all Securities, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Bond shall be conclusive and binding upon such Holder and upon all future
Holders of this Bond and of any Security issued upon the registration of
transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
This Bond has been issued by the Company to the Administrative Agent for the
benefit of the holders of the Loans to (i) provide security for the payment of
the Company's obligations on the Loans under the Credit Agreement and (ii)
provide to the holders of such Loans the benefits of the security provided for
this Bond pursuant to the Indenture.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Administrative Agent, signed by an authorized officer of the Administrative
Agent and attested by the Secretary or an Assistant Secretary of the
Administrative Agent within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall note the amounts of all reductions in the principal
of the Loans under the Credit Agreement, and shall notify the Company and the
Trustee of the name and address of the transferee and shall afford the Company
and the Trustee the opportunity of verifying the notation as to such reductions.
By acceptance hereof the holder of this Bond and each transferee shall be deemed
to have agreed to indemnify and hold harmless the Company and the Trustee
against all losses, claims, damages or liability arising out of any failure on
part of the holder or of any such transferee to comply with the requirements of
the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.
[The remainder of this page is intentionally left blank.]
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By:
--------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: October 10, 2002
JPMORGAN CHASE BANK, as Trustee
By:
--------------------------------------
Authorized Signatory
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the second series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series B, due
November 1, 2018" (the "Series B Bonds").
(2) The Series B Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $50,000,000.
(3) Not applicable.
(4) The Series B Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on November 1, 2018. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1997 BR Bonds").
(5) The Series B Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series B Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date
1
under the Trust Indenture dated as of January 1, 1997 (as amended and
supplemented, the "Trust Indenture") between Brazos River Authority
(the "Issuer") and Bank One Trust Company, National Association
(successor to The First National Bank of Chicago), as trustee (the
"Trust Indenture Trustee") in respect of the Series 1997 BR Bonds. Such
interest on the Series B Bonds shall be payable on the same dates as
interest is payable from time to time in respect of the Series 1997 BR
Bonds pursuant to the Trust Indenture (each such date herein called an
"Interest Payment Date"), until the maturity of the Series B Bonds, or,
in the case of any default by the Company in the payment of the
principal due on the Series B Bonds, until the Company's obligation
with respect to the payment of such principal shall be discharged as
provided in the Indenture. The amount of interest payable from time to
time in respect of the Series 1997 BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which
such interest is payable are set forth in the Trust Indenture. Each
Series B Bond shall bear interest from the later of the date of initial
authentication of such Series B Bond or the most recent Interest
Payment Date to which interest has been paid. The obligation of the
Company to make any payment of interest on the Series B Bonds shall be
fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has
paid to the Trust Indenture Trustee the Installment Payment in respect
of the interest then due and payable on the Series 1997 BR Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas, shall be the place at which (i) the principal of, premium and
interest on, the Series B Bonds shall be payable, (ii) registration of
transfer of the Series B Bonds may be effected, (iii) exchanges of the
Series B Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series B Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series B Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series B Bonds.
(7) Not applicable.
2
(8) Not applicable.
(9) The Series B Bonds are issuable only in denominations of
$50,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable
(16) Not applicable.
(17) The Series B Bonds shall be evidenced by a single registered
Series B Bond in the principal amount and denomination of Fifty Million
Dollars ($50,000,000). The Series B Bonds shall be dated October 10,
2002, shall mature no later than November 1, 2018, unless sooner paid,
and shall bear interest at the rate specified in subsection (5) above.
The Series B Bonds may be executed by the Company and delivered to the
Trustee for authentication and delivery. The principal of and interest
on the Bonds shall be payable at the Corporate Trust Office of the
Trustee in Houston, Texas.
The single Series B Bond shall be identified by the number B-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series B Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
January 1, 1997, by and between the Issuer and CenterPoint (as
successor). The single Series B Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series B Bonds Collateral
Agreement (Series B Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series B Bonds issued upon transfer shall be numbered consecutively
from B-2 upwards and issued in the same $50,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series B Bond by acceptance of the Series B
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series B Bonds have not
been registered under the Securities Act of 1933 and may
3
not be offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series B Bonds, or any Tranche thereof; provided, however, that the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the exchange or
transfer.
(20) For purposes of the Series B Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series B Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture Trustee, signed
by an authorized officer of the Indenture Trustee and attested by the
Secretary or an Assistant Secretary of the Indenture Trustee within 90
days after the applicable Interest Payment Date, stating that the
payment of principal of or interest on the Series B Bond has not been
fully paid when due and specifying the amount of funds required to make
such payment.
The Series B Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series B Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate on
this 10th day of October, 2002.
By: /s/ Marc Kilbride
-------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
-----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
EXHIBIT A
FORM OF SERIES B BOND
6
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series B, due November 1, 2018
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: November 1, 2018 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$50,000,000 No. B-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to Bank One Trust Company, National
Association as Trustee under the Trust Indenture (as herein defined) or its
registered assigns (the "Indenture Trustee"), the principal sum of FIFTY MILLION
DOLLARS, in whole or in installments on such date or dates as the Issuer (as
defined herein) has any obligations under the Trust Indenture (as amended and
supplemented, the "Trust Indenture"), dated as of January 1, 1997, between
Brazos River Authority (the "Issuer") and the Indenture Trustee (as successor)
to repay any principal in respect of the Bonds (as such term is defined in the
Trust Indenture, and hereinafter referred to as the "Series 1997 BR Bonds"),
excluding any payment of principal in advance of the final scheduled maturity
date thereof, but not later than the Stated Maturity specified above. The
obligation of the Company to make any payment of principal on this Bond, whether
at maturity or otherwise, shall be fully or partially, as the case may be,
deemed to have been paid or otherwise satisfied and discharged to the extent
CenterPoint Energy, Inc. ("CenterPoint") has paid to the Indenture Trustee the
Installment Payment (as defined below) in respect of the principal then due and
payable on the Series 1997 BR Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1997 BR Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1997 BR Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1997 BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest is
payable are set forth in the Trust Indenture. This Bond shall bear interest (a)
from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Indenture Trustee the Installment Payment in respect of the interest then
due and payable on the Series 1997 BR Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of January 1,
1997, between the Brazos River Authority and CenterPoint (as successor). This
Bond shall be held by the Trust Indenture Trustee subject to the terms of the
Collateral Agreement (Series B Bonds), dated as of October 10, 2002, between the
Company and the Indenture Trustee. Any capitalized terms used herein and not
defined herein shall have the meanings specified in the Indenture (as defined
below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1997 BR Bonds shall have been duly paid,
and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
purpose.
[The remainder of this page is intentionally left blank.]
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the third series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series C, due
November 1, 2028" (the "Series C Bonds").
(2) The Series C Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $68,000,000.
(3) Not applicable.
(4) The Series C Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on November 1, 2028. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1997 MC Bonds").
(5) The Series C Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series C Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date under the
Trust Indenture dated as of January 1, 1997 (as amended and
supplemented, the "Trust Indenture") between Matagorda County
Navigation District Number One (the "Issuer") and Bank One Trust
Company, National Association (successor to The First National Bank of
Chicago), as trustee (the "Trust Indenture Trustee") in respect of the
Series 1997 MC Bonds. Such
1
interest on the Series C Bonds shall be payable on the same dates as
interest is payable from time to time in respect of the Series 1997 PC
Bonds pursuant to the Trust Indenture (each such date herein called an
"Interest Payment Date"), until the maturity of the Series C Bonds, or,
in the case of any default by the Company in the payment of the
principal due on the Series C Bonds, until the Company's obligation
with respect to the payment of such principal shall be discharged as
provided in the Indenture. The amount of interest payable from time to
time in respect of the Series 1997 MC Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which
such interest is payable are set forth in the Trust Indenture. Each
Series C Bond shall bear interest from the later of the date of initial
authentication of such Series C Bond or the most recent Interest
Payment Date to which interest has been paid. The obligation of the
Company to make any payment of interest on the Series C Bonds shall be
fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has
paid to the Trustee the Installment Payment in respect of the interest
then due and payable on the Series 1997 MC Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series C Bonds shall be payable, (ii) registration of
transfer of the Series C Bonds may be effected, (iii) exchanges of the
Series C Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series C Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series C Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series C Bonds.
(7) Not applicable.
(8) Not applicable.
(9) The Series C Bonds are issuable only in denominations of
$68,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
2
(17) The Series C Bonds shall be evidenced by a single registered
Series C Bond in the principal amount and denomination of Sixty-Eight
Million Dollars ($68,000,000). The Series C Bonds shall be dated
October 10, 2002, shall mature no later than November 1, 2028, unless
sooner paid, and shall bear interest at the rate specified in
subsection (5) above. The Series C Bonds may be executed by the Company
and delivered to the Trustee for authentication and delivery. The
principal of and interest on the Bonds shall be payable at the
Corporate Trust Office of the Trustee in Houston, Texas.
The single Series C Bond shall be identified by the number C-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series C Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
January 1, 1997, by and between the Issuer and CenterPoint (as
successor). The single Series C Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series C Bonds Collateral
Agreement (Series B Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series C Bonds issued upon transfer shall be numbered consecutively
from C-2 upwards and issued in the same $68,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series C Bond by acceptance of the Series C
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series C Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series C Bonds, or any Tranche thereof; provided, however, that the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the exchange or
transfer.
(20) For purposes of the Series C Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series C Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture
3
Trustee, signed by an authorized officer of the Indenture Trustee and
attested by the Secretary or an Assistant Secretary of the Indenture
Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on the Series C
Bond has not been fully paid when due and specifying the amount of
funds required to make such payment.
The Series C Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series C Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
----------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
----------------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
EXHIBIT A
FORM OF SERIES C BOND
6
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series C, due November 1, 2028
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: November 1, 2028 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$68,000,000 No. C-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to Bank One Trust Company, National
Association as Trustee under the Trust Indenture (as herein defined) or its
registered assigns (the "Indenture Trustee"), the principal sum of SIXTY EIGHT
MILLION DOLLARS, in whole or in installments on such date or dates as the Issuer
(as defined herein) has any obligations under the Trust Indenture (as amended
and supplemented, the "Trust Indenture"), dated as of January 1, 1997, between
Matagorda County Navigation District Number One (the "Issuer") and the Indenture
Trustee (as successor) to repay any principal in respect of the Bonds (as such
term is defined in the Trust Indenture, and hereinafter referred to as the
"Series 1997 MC Bonds"), excluding any payment of principal in advance of the
final scheduled maturity date thereof, but not later than the Stated Maturity
specified above. The obligation of the Company to make any payment of principal
on this Bond, whether at maturity or otherwise, shall be fully or partially, as
the case may be, deemed to have been paid or otherwise satisfied and discharged
to the extent CenterPoint Energy, Inc. ("CenterPoint") has paid to the Indenture
Trustee the Installment Payment (as defined below) in respect of the principal
then due and payable on the Series 1997 MC Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1997 MC Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1997 MC Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as
1
provided in the Indenture. The amount of interest payable from time to time in
respect of the Series 1997 MC Bonds under the Trust Indenture, the basis on
which such interest is computed and the dates on which such interest is payable
are set forth in the Trust Indenture. This Bond shall bear interest (a) from the
Interest Payment Date next preceding the date of this Bond to which interest has
been paid, or (b) if the date of this Bond is an Interest Payment Date to which
interest has been paid, then from such date, or (c) if no interest has been paid
on this Bond, then from the date of initial authentication of this Bond. The
obligation of the Company to make any payment of interest on this Bond shall be
fully or partially, as the case may be, deemed to have been paid or otherwise
satisfied and discharged to the extent that CenterPoint has paid to the
Indenture Trustee the Installment Payment in respect of the interest then due
and payable on the Series 1997 MC Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of January 1,
1997, between Matagorda County Navigation District Number One and CenterPoint
(as successor). This Bond shall be held by the Indenture Trustee subject to the
terms of the Collateral Agreement (Series C Bonds), dated as of October 10,
2002, between the Company and the Trust Indenture Trustee. Any capitalized terms
used herein and not defined herein shall have the meanings specified in the
Indenture (as defined below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1997 MC Bonds shall have been duly paid,
and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and
2
PROVIDED, FURTHER, that the Indenture permits the Trustee to enter into one or
more supplemental indentures for limited purposes without the consent of any
Holders of Securities. The Indenture also contains provisions permitting the
Holders of a majority in principal amount of the Securities then Outstanding, on
behalf of the Holders of all Securities, to waive compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Bond shall be conclusive and binding upon such Holder and upon all future
Holders of this Bond and of any Security issued upon the registration of
transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
3
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the fourth series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series D, due
May 1, 2019" (the "Series D Bonds").
(2) The Series D Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $100,000,000.
(3) Not applicable.
(4) The Series D Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on May 1, 2019. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1998A BR Bonds").
(5) The Series D Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series D Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date under the
Trust Indenture dated as of February 1, 1998 (as amended and
supplemented, the "Trust Indenture") between Brazos River Authority
(the "Issuer") and JPMorgan Chase Bank (successor to Chase Bank of
Texas, National Association, as trustee (the "Trust Indenture Trustee")
in respect of the Series 1998A BR Bonds. Such interest on the Series D
Bonds shall be payable on
1
the same dates as interest is payable from time to time in respect of
the Series 1998A BR Bonds pursuant to the Trust Indenture (each such
date herein called an "Interest Payment Date"), until the maturity of
the Series D Bonds, or, in the case of any default by the Company in
the payment of the principal due on the Series D Bonds, until the
Company's obligation with respect to the payment of such principal
shall be discharged as provided in the Indenture. The amount of
interest payable from time to time in respect of the Series 1998A BR
Bonds under the Trust Indenture, the basis on which such interest is
computed and the dates on which such interest is payable are set forth
in the Trust Indenture. Each Series D Bond shall bear interest from the
later of the date of initial authentication of such Series D Bond or
the most recent Interest Payment Date to which interest has been paid.
The obligation of the Company to make any payment of interest on the
Series D Bonds shall be fully or partially, as the case may be, deemed
to have been paid or otherwise satisfied and discharged to the extent
that CenterPoint has paid to the Trust Indenture Trustee the
Installment Payment in respect of the interest then due and payable on
the Series 1998A BR Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series D Bonds shall be payable, (ii) registration of
transfer of the Series D Bonds may be effected, (iii) exchanges of the
Series D Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series D Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series D Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series D Bonds.
(7) Not applicable.
(8) Not applicable.
(9) The Series D Bonds are issuable only in denominations of
$100,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
2
(17) The Series D Bonds shall be evidenced by a single registered
Series D Bond in the principal amount and denomination of One Hundred
Million Dollars ($100,000,000). The Series D Bonds shall be dated
October 10, 2002, shall mature no later than May 1, 2019, unless sooner
paid, and shall bear interest at the rate specified in subsection (5)
above. The Series D Bonds may be executed by the Company and delivered
to the Trustee for authentication and delivery. The principal of and
interest on the Bonds shall be payable at the Corporate Trust Office of
the Trustee in Houston, Texas.
The single Series D Bond shall be identified by the number D-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series D Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
February 1, 1998, by and between the Issuer and CenterPoint (as
successor). The single Series D Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series D Bonds Collateral
Agreement (Series D Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series D Bonds issued upon transfer shall be numbered consecutively
from D-2 upwards and issued in the same $100,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series D Bond by acceptance of the Series D
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series D Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series D Bonds, or any Tranche thereof; provided, however, that the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the exchange or
transfer.
(20) For purposes of the Series D Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series D Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture
3
Trustee, signed by an authorized officer of the Indenture Trustee and
attested by the Secretary or an Assistant Secretary of the Indenture
Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on the Series D
Bond has not been fully paid when due and specifying the amount of
funds required to make such payment.
The Series D Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series D Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
---------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
FORM OF SERIES D BONDS
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series D, due May 1, 2019
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: May 1, 2019 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$100,000,000 No. D-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to JPMorgan Chase Bank as Trustee under
the Trust Indenture (as herein defined) or its registered assigns (the
"Indenture Trustee"), the principal sum of ONE HUNDRED MILLION DOLLARS, in whole
or in installments on such date or dates as the Issuer (as defined herein) has
any obligations under the Trust Indenture (as amended and supplemented, the
"Trust Indenture"), dated as of February 1, 1998, between Brazos River Authority
(the "Issuer") and the Indenture Trustee (as successor) to repay any principal
in respect of the 1998A Bonds (as such term is defined in the Trust Indenture,
and hereinafter referred to as the "Series 1998A BR Bonds"), excluding any
payment of principal in advance of the final scheduled maturity date thereof,
but not later than the Stated Maturity specified above. The obligation of the
Company to make any payment of principal on this Bond, whether at maturity or
otherwise, shall be fully or partially, as the case may be, deemed to have been
paid or otherwise satisfied and discharged to the extent CenterPoint Energy,
Inc. ("CenterPoint") has paid to the Indenture Trustee the Installment Payment
(as defined below) in respect of the principal then due and payable on the
Series 1998A BR Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1998A BR Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1998A BR Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1998A BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest
1
is payable are set forth in the Trust Indenture. This Bond shall bear interest
(a) from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Trust Indenture Trustee the Installment Payment in respect of the interest
then due and payable on the Series 1998A BR Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of February 1,
1998, between the Brazos River Authority and CenterPoint (as successor). This
Bond shall be held by the Trust Indenture Trustee subject to the terms of the
Collateral Agreement, (Series D Bonds) dated as of October 10, 2002, between the
Company and the Indenture Trustee. Any capitalized terms used herein and not
defined herein shall have the meanings specified in the Indenture (as defined
below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1998A BR Bonds shall have been duly
paid, and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
2
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
3
purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the fifth series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series E, due
November 1, 2020" (the "Series E Bonds").
(2) The Series E Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $90,000,000.
(3) Not applicable.
(4) The Series E Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on November 1, 2020. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1998B BR Bonds").
(5) The Series E Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series E Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date under the
Trust Indenture dated as of February 1, 1998 (as amended and
supplemented, the "Trust Indenture") between Brazos River Authority
(the "Issuer") and JPMorgan Chase Bank (successor to Chase Bank of
Texas, National Association), as trustee (the "Trust Indenture
Trustee") in respect of the Series 1998A BR Bonds. Such interest on the
Series E Bonds shall be
payable on the same dates as interest is payable from time to time in
respect of the Series 1998B BR Bonds pursuant to the Trust Indenture
(each such date herein called an "Interest Payment Date"), until the
maturity of the Series E Bonds, or, in the case of any default by the
Company in the payment of the principal due on the Series E Bonds,
until the Company's obligation with respect to the payment of such
principal shall be discharged as provided in the Indenture. The amount
of interest payable from time to time in respect of the Series 1998B BR
Bonds under the Trust Indenture, the basis on which such interest is
computed and the dates on which such interest is payable are set forth
in the Trust Indenture. Each Series E Bond shall bear interest from the
later of the date of initial authentication of such Series E Bond or
the most recent Interest Payment Date to which interest has been paid.
The obligation of the Company to make any payment of interest on the
Series E Bonds shall be fully or partially, as the case may be, deemed
to have been paid or otherwise satisfied and discharged to the extent
that CenterPoint has paid to the Trust Indenture Trustee the
Installment Payment in respect of the interest then due and payable on
the Series 1998B BR Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series E Bonds shall be payable, (ii) registration of
transfer of the Series E Bonds may be effected, (iii) exchanges of the
Series E Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series E Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series E Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series E Bonds.
(7) Not applicable.
(8) Not applicable.
(9) The Series E Bonds are issuable only in denominations of
$90,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
2
(17) The Series E Bonds shall be evidenced by a single registered
Series E Bond in the principal amount and denomination of Ninety
Million Dollars ($90,000,000). The Series E Bonds shall be dated
October 10, 2002, shall mature no later than November 1, 2020, unless
sooner paid, and shall bear interest at the rate specified in
subsection (5) above. The Series E Bonds may be executed by the Company
and delivered to the Trustee for authentication and delivery. The
principal of and interest on the Bonds shall be payable at the
Corporate Trust Office of the Trustee in Houston, Texas.
The single Series E Bond shall be identified by the number E-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series E Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
February 1, 1998, by and between the Issuer and CenterPoint (as
successor). The single Series E Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series E Bonds Collateral
Agreement (Series E Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series E Bonds issued upon transfer shall be numbered consecutively
from E-2 upwards and issued in the same $90,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series E Bond by acceptance of the Series E
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series E Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series E Bonds, or any Tranche thereof; provided, however, that the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection with the exchange or
transfer.
(20) For purposes of the Series E Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series E Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture
3
Trustee, signed by an authorized officer of the Indenture Trustee and
attested by the Secretary or an Assistant Secretary of the Indenture
Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on the Series E
Bond has not been fully paid when due and specifying the amount of
funds required to make such payment.
The Series E Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be issued
in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series E Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
----------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
FORM OF SERIES E BONDS
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series E, due November 1, 2020
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: November 1, 2020 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$90,000,000 No. E-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to JPMorgan Chase Bank as Trustee under
the Trust Indenture (as herein defined) or its registered assigns (the
"Indenture Trustee"), the principal sum of NINETY MILLION DOLLARS, in whole or
in installments on such date or dates as the Issuer (as defined herein) has any
obligations under the Trust Indenture (as amended and supplemented, the "Trust
Indenture"), dated as of February 1, 1998, between Brazos River Authority (the
"Issuer") and the Indenture Trustee (as successor) to reply any principal in
respect of the 1998B Bonds (as such term is defined in the Trust Indenture, and
hereinafter referred to as the "Series 1998B BR Bonds"), excluding any payment
of principal in advance of the final scheduled maturity date thereof, but not
later than the Stated Maturity specified above. The obligation of the Company to
make any payment of principal on this Bond, whether at maturity or otherwise,
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent CenterPoint Energy, Inc.
("CenterPoint") has paid to the Indenture Trustee the Installment Payment (as
defined below) in respect of the principal then due and payable on the Series
1998B BR Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1998B BR Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1998B BR Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1998B BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest
1
is payable are set forth in the Trust Indenture. This Bond shall bear interest
(a) from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Indenture Trustee the Installment Payment in respect of the interest then
due and payable on the Series 1998B BR Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of February 1,
1998, between the Brazos River Authority and CenterPoint (as successor). This
Bond shall be held by the Trust Indenture Trustee subject to the terms of the
Collateral Agreement (Series E Bonds), dated as of October 10, 2002, between the
Company and the Indenture Trustee. Any capitalized terms used herein and not
defined herein shall have the meanings specified in the Indenture (as defined
below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1998B BR Bonds shall have been duly
paid, and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
2
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
3
purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the sixth series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series F, due
May 1, 2019" (the "Series F Bonds").
(2) The Series F Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $100,000,000.
(3) Not applicable.
(4) The Series F Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on May 1, 2019. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1998C BR Bonds").
(5) The Series F Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series F Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date under the
Trust Indenture dated as of February 1, 1998 (as amended and
supplemented, the "Trust Indenture") between Brazos
1
River Authority (the "Issuer") and JPMorgan Chase Bank (successor to
Chase Bank of Texas, National Association), as trustee (the "Trust
Indenture Trustee") in respect of the Series 1998C BR Bonds. Such
interest on the Series F Bonds shall be payable on the same dates as
interest is payable from time to time in respect of the Series 1998C BR
Bonds pursuant to the Trust Indenture (each such date herein called an
"Interest Payment Date"), until the maturity of the Series F Bonds, or,
in the case of any default by the Company in the payment of the
principal due on the Series F Bonds, until the Company's obligation
with respect to the payment of such principal shall be discharged as
provided in the Indenture. The amount of interest payable from time to
time in respect of the Series 1998C BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which
such interest is payable are set forth in the Trust Indenture. Each
Series F Bond shall bear interest from the later of the date of initial
authentication of such Series F Bond or the most recent Interest
Payment Date to which interest has been paid. The obligation of the
Company to make any payment of interest on the Series F Bonds shall be
fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has
paid to the Trust Indenture Trustee the Installment Payment in respect
of the interest then due and payable on the Series 1998C BR Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series F Bonds shall be payable, (ii) registration of
transfer of the Series F Bonds may be effected, (iii) exchanges of the
Series F Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series F Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series F Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series F Bonds.
(7) Not applicable.
(8) Not applicable.
(9) The Series F Bonds are issuable only in denominations of
$100,000,000.
2
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
(17) The Series F Bonds shall be evidenced by a single registered
Series F Bond in the principal amount and denomination of One Hundred
Million Dollars ($100,000,000). The Series F Bonds shall be dated
October 10, 2002, shall mature no later than May 1, 2019, unless sooner
paid, and shall bear interest at the rate specified in subsection (5)
above. The Series F Bonds may be executed by the Company and delivered
to the Trustee for authentication and delivery. The principal of and
interest on the Bonds shall be payable at the Corporate Trust Office of
the Trustee in Houston, Texas.
The single Series F Bond shall be identified by the number F-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by any such successor or assign. The Series F Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
February 1, 1998, by and between the Issuer and CenterPoint (as
successor). The single Series F Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series F Bonds Collateral
Agreement (Series F Bonds) , dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series F Bonds issued upon transfer shall be numbered consecutively
from F-2 upwards and issued in the same $100,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series F Bond by acceptance of the Series F
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series F Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series F Bonds, or any Tranche thereof; provided, however,
3
that the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection with the
exchange or transfer.
(20) For purposes of the Series F Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series F Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture Trustee, signed
by an authorized officer of the Indenture Trustee and attested by the
Secretary or an Assistant Secretary of the Indenture Trustee within 90
days after the applicable Interest Payment Date, stating that the
payment of principal of or interest on the Series F Bond has not been
fully paid when due and specifying the amount of funds required to make
such payment.
The Series F Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series F Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
----------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
EXHIBIT A
FORM OF SERIES F BOND
6
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series F, due May 1, 2019
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: May 1, 2019 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$100,000,000 No. F-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to JPMorgan Chase Bank as Trustee under
the Trust Indenture (as herein defined) or its registered assigns (the
"Indenture Trustee"), the principal sum of ONE HUNDRED MILLION DOLLARS, in whole
or in installments on such date or dates as the Issuer (as defined herein) has
any obligations under the Trust Indenture (as amended and supplemented, the
"Trust Indenture"), dated as of February 1, 1998, between Brazos River Authority
(the "Issuer") and the Indenture Trustee (as successor) to repay any principal
in respect of the 1998C Bonds (as such term is defined in the Trust Indenture,
and hereinafter referred to as the "Series 1998C BR Bonds"), excluding any
payment of principal in advance of the final scheduled maturity date thereof,
but not later than the Stated Maturity specified above. The obligation of the
Company to make any payment of principal on this Bond, whether at maturity or
otherwise, shall be fully or partially, as the case may be, deemed to have been
paid or otherwise satisfied and discharged to the extent CenterPoint Energy,
Inc. ("CenterPoint") has paid to the Indenture Trustee the Installment Payment
(as defined below) in respect of the principal then due and payable on the
Series 1998C BR Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1998C BR Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1998C BR Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1998C BR Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest
1
is payable are set forth in the Trust Indenture. This Bond shall bear interest
(a) from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Indenture Trustee the Installment Payment in respect of the interest then
due and payable on the Series 1998C BR Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of February 1,
1998, between the Brazos River Authority and CenterPoint (as successor). This
Bond shall be held by the Trust Indenture Trustee subject to the terms of the
Collateral Agreement (Series F Bonds), dated as of October 10, 2002, between the
Company and the Indenture Trustee. Any capitalized terms used herein and not
defined herein shall have the meanings specified in the Indenture (as defined
below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1998C BR Bonds shall have been duly
paid, and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
2
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
3
purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the seventh series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series G, due
January 1, 2011" (the "Series G Bonds").
(2) The Series G Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $19,200,000.
(3) Not applicable.
(4) The Series G Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on January 1, 2011. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1999 GC Bonds").
(5) The Series G Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series G Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Dates under the
Trust Indenture dated as of April 1, 1999 (as amended and supplemented,
the "Trust Indenture") between Gulf Coast Waste
Disposal Authority (the "Issuer") and JPMorgan Chase Bank (successor to
Chase Bank of Texas, National Association), as trustee (the "Trust
Indenture Trustee") in respect of the Series 1999 GC Bonds". Such
interest on the Series G Bonds shall be payable on the same dates as
interest is payable from time to time in respect of the Series 1999 GC
Bonds pursuant to the Trust Indenture (each such date herein called an
"Interest Payment Date"), until the maturity of the Series G Bonds, or,
in the case of any default by the Company in the payment of the
principal due on the Series G Bonds, until the Company's obligation
with respect to the payment of such principal shall be discharged as
provided in the Indenture. The amount of interest payable from time to
time in respect of the Series 1999 GC Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which
such interest is payable are set forth in the Trust Indenture. Each
Series G Bond shall bear interest from the later of the date of initial
authentication of such Series G Bond or the most recent Interest
Payment Date to which interest has been paid. The obligation of the
Company to make any payment of interest on the Series G Bonds shall be
fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has
paid to the Trust Indenture Trustee the Installment Payment in respect
of the interest then due and payable on the Series 1999 GC Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series G Bonds shall be payable, (ii) registration of
transfer of the Series G Bonds may be effected, (iii) exchanges of the
Series G Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series G Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series G Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series G Bonds.
(7) Not applicable.
(8) Not applicable.
(9) The Series G Bonds are issuable only in denominations of
$19,200,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
(17) The Series G Bonds shall be evidenced by a single registered
Series G Bond in the principal amount and denomination of Nineteen
Million Two Hundred Thousand Dollars ($19,200,000). The Series G Bonds
shall be dated October 10, 2002, shall mature no later than January 1,
2011, unless sooner paid, and shall bear interest at the rate specified
in subsection (5) above. The Series G Bonds may be executed by the
Company and delivered to the Trustee for authentication and delivery.
The principal of and interest on the Bonds shall be payable at the
Corporate Trust Office of the Trustee in Houston, Texas.
The single Series G Bond shall be identified by the number G-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series G Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
April 1, 1999, by and between the Issuer and CenterPoint (as
successor). The single Series G Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series G Bonds Collateral
Agreement (Series G Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series G Bonds issued upon transfer shall be numbered consecutively
from G-2 upwards and issued in the same $19,200,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series G Bond by acceptance of the Series G
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series G Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of transfer or exchange of the
Series G Bonds, or any Tranche thereof; provided, however,
that the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection with the
exchange or transfer.
(20) For purposes of the Series G Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series G Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture Trustee, signed
by an authorized officer of the Indenture Trustee and attested by the
Secretary or an Assistant Secretary of the Indenture Trustee within 90
days after the applicable Interest Payment Date, stating that the
payment of principal of or interest on the Series G Bond has not been
fully paid when due and specifying the amount of funds required to make
such payment.
The Series G Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be issued
in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series G Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
----------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
-----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
EXHIBIT A
FORM OF SERIES G BOND
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series G, due January 1, 2011
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: January 1, 2011 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$19,200,000 No. G-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to JPMorgan Chase Bank as Trustee under
the Trust Indenture (as herein defined) or its registered assigns (the
"Indenture Trustee"), the principal sum of NINETEEN MILLION TWO HUNDRED THOUSAND
DOLLARS, in whole or in installments on such date or dates as the Issuer (as
defined herein) has any obligations under the Trust Indenture (as amended and
supplemented, the "Trust Indenture"), dated as of April 1, 1999, between Gulf
Coast Waste Disposal Authority (the "Issuer") and the Indenture Trustee (as
successor) to repay any principal in respect of the Bonds (as such term is
defined in the Trust Indenture, and hereinafter referred to as the "Series 1999
GC Bonds"), excluding any payment of principal in advance of the final scheduled
maturity date thereof, but not later than the Stated Maturity specified above.
The obligation of the Company to make any payment of principal on this Bond,
whether at maturity or otherwise, shall be fully or partially, as the case may
be, deemed to have been paid or otherwise satisfied and discharged to the extent
CenterPoint Energy, Inc. ("CenterPoint") has paid to the Indenture Trustee the
Installment Payment (as defined below) in respect of the principal then due and
payable on the Series 1999 GC Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1999 GC Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1999 GC Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1999 GC Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest is
1
payable are set forth in the Trust Indenture. This Bond shall bear interest (a)
from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Indenture Trustee the Installment Payment in respect of the interest then
due and payable on the Series 1999 GC Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of April 1, 1999,
between Gulf Coast Waste Disposal Authority and CenterPoint (as successor). This
Bond shall be held by the Trust Indenture Trustee subject to the terms of the
Collateral Agreement (Series G Bonds), dated as of October 10, 2002, between the
Company and the Indenture Trustee. Any capitalized terms used herein and not
defined herein shall have the meanings specified in the Indenture (as defined
below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1999 GC Bonds shall have been duly paid,
and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
2
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
3
purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
OFFICER'S CERTIFICATE
October 10, 2002
I, the undersigned officer of CenterPoint Energy Houston Electric, LLC, a Texas
limited liability company (the "Company"), do hereby certify that I am an
Authorized Officer of the Company as such term is defined in the Indenture (as
defined herein). I am delivering this certificate pursuant to the authority
granted in the Resolutions adopted by written consent of the Manager of the
Company dated October 10, 2002, and Sections 105, 201, 301, 401(1) and 402(2)(A)
of the General Mortgage Indenture dated as of October 10, 2002, as heretofore
supplemented to the date hereof (as heretofore supplemented, the "Indenture"),
between the Company and JPMorgan Chase Bank, as Trustee (the "Trustee"). Terms
used herein and not otherwise defined herein shall have the meanings assigned to
them in the Indenture unless the context clearly requires otherwise. Based upon
the foregoing, I hereby certify on behalf of the Company as follows:
1. The terms and conditions of the Securities of the series described in
this Officer's Certificate are as follows (the numbered subdivisions set forth
in this Paragraph 1 corresponding to the numbered subdivisions of Section 301 of
the Indenture):
(1) The Securities of the eighth series to be issued under the
Indenture shall be designated "General Mortgage Bonds, Series H, due
June 1, 2026" (the "Series H Bonds").
(2) The Series H Bonds shall be initially authenticated and
delivered in the aggregate principal amount of $100,000,000.
(3) Not applicable.
(4) The Series H Bonds shall mature and the principal thereof
shall be due and payable together with all accrued and unpaid interest
thereon on June 1, 2026. The obligation of the Company to make any
payment of principal on this Bond shall be fully or partially, as the
case may be, deemed to have been paid or otherwise satisfied and
discharged to the extent CenterPoint Energy, Inc. ("CenterPoint") has
paid to the Trust Indenture Trustee the Installment Payment (as defined
below) in respect of the principal then due and payable on the Bonds
(as such term is defined in the Trust Indenture, and hereinafter
referred to as the "Series 1999A MC Bonds").
(5) The Series H Bonds shall bear interest from the time
hereinafter provided at such rate per annum as shall cause the amount
of interest payable on each Interest Payment Date (as hereinafter
defined) on the Series H Bonds to equal the amount of regularly
scheduled interest payable on such Interest Payment Date under the
Trust Indenture dated as of April 1, 1999 (as amended and supplemented,
the "Trust Indenture") between Matagorda
1
County Navigation District Number One (the "Issuer") and JPMorgan Chase
Bank (successor to Chase Bank of Texas, National Association, as
trustee (the "Trust Indenture Trustee") in respect of the Series 1999A
MC Bonds. Such interest on the Series H Bonds shall be payable on the
same dates as interest is payable from time to time in respect of the
Series 1999A MC Bonds pursuant to the Trust Indenture (each such date
herein called an "Interest Payment Date"), until the maturity of the
Series H Bonds, or, in the case of any default by the Company in the
payment of the principal due on the Series H Bonds, until the Company's
obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable
from time to time in respect of the Series 1999A MC Bonds under the
Trust Indenture, the basis on which such interest is computed and the
dates on which such interest is payable are set forth in the Trust
Indenture. Each Series H Bond shall bear interest from the later of the
date of initial authentication of such Series H Bond or the most recent
Interest Payment Date to which interest has been paid. The obligation
of the Company to make any payment of interest on the Series H Bonds
shall be fully or partially, as the case may be, deemed to have been
paid or otherwise satisfied and discharged to the extent that
CenterPoint has paid to the Trust Indenture Trustee the Installment
Payment in respect of the interest then due and payable on the Series
1999A MC Bonds.
(6) The Corporate Trust Office of JPMorgan Chase Bank in Houston,
Texas shall be the place at which (i) the principal of, premium and
interest on, the Series H Bonds shall be payable, (ii) registration of
transfer of the Series H Bonds may be effected, (iii) exchanges of the
Series H Bonds may be effected and (iv) notices and demands to or upon
the Company in respect of the Series H Bonds and the Indenture may be
served; and JPMorgan Chase Bank shall be the Security Registrar for the
Series H Bonds; provided, however, that the Company reserves the right
to change, by one or more Officer's Certificates, any such place or the
Security Registrar; and provided, further, that the Company reserves
the right to designate, by one or more Officer's Certificates, its
principal office in Houston, Texas as any such place or itself as the
Security Registrar; provided, however, that there shall be only a
single Security Registrar for the Series H Bonds.
(7) Not applicable.
(8) Not applicable.
2
(9) The Series H Bonds are issuable only in denominations of
$100,000,000.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15) Not applicable.
(16) Not applicable.
(17) The Series H Bonds shall be evidenced by a single registered
Series H Bond in the principal amount and denomination of One Hundred
Million Dollars ($100,000,000). The Series H Bonds shall be dated
October 10, 2002, shall mature no later than June 1, 2026, unless
sooner paid, and shall bear interest at the rate specified in
subsection (5) above. The Series H Bonds may be executed by the Company
and delivered to the Trustee for authentication and delivery. The
principal of and interest on the Bonds shall be payable at the
Corporate Trust Office of the Trustee in Houston, Texas.
The single Series H Bond shall be identified by the number H-1 and
shall upon issuance be delivered by the Company to, and registered in
the name of, the Trust Indenture Trustee, and shall be transferable
only as required to effect an assignment thereof to a successor or an
assign of the Trust Indenture Trustee under the Trust Indenture, and
provided that all obligations of the Trust Indenture Trustee under the
Collateral Agreement (as defined herein) shall also be transferred to,
and assumed by, any such successor or assign. The Series H Bonds are to
be issued to the Trust Indenture Trustee as security for the payment by
CenterPoint of the Installment Payments, as defined in, and pursuant to
the Installment Payment and Bond Amortization Agreement, dated as of
April 1, 1999, by and between the Issuer and CenterPoint (as
successor). The single Series H Bond shall be held by the Trust
Indenture Trustee subject to the terms of the Series H Bonds Collateral
Agreement (Series H Bonds), dated as of October 10, 2002, between the
Company and the Trust Indenture Trustee (the "Collateral Agreement").
Series H Bonds issued upon transfer shall be numbered consecutively
from H-2 upwards and issued in the same $100,000,000 denomination. See
also subsection (19) below.
(18) Not applicable.
(19) The holder of the Series H Bond by acceptance of the Series H
Bond agrees to restrictions on transfer and to waivers of certain
rights of exchange as set forth herein. The Series H Bonds have not
been registered under the Securities Act of 1933 and may not be
offered, sold or otherwise transferred in the absence of such
registration or an applicable exemption therefrom. No service charge
shall be made for the registration of
3
transfer or exchange of the Series H Bonds, or any Tranche thereof;
provided, however, that the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection with the exchange or transfer.
(20) For purposes of the Series H Bonds, "Business Day" means any
day other than (i) a Saturday or Sunday, (ii) a day on which commercial
banks in New York, New York, Houston, Texas, or the city in which the
principal corporate trust office of the Indenture Trustee is located,
are authorized by law to close or (iii) a day on which the New York
Stock Exchange is closed.
(21) Not applicable.
(22) The Trustee may conclusively presume that the obligation of
the Company to pay the principal of and interest on the Series H Bond
shall have been fully satisfied and discharged unless and until it
shall have received a written notice from the Indenture Trustee, signed
by an authorized officer of the Indenture Trustee and attested by the
Secretary or an Assistant Secretary of the Indenture Trustee within 90
days after the applicable Interest Payment Date, stating that the
payment of principal of or interest on the Series H Bond has not been
fully paid when due and specifying the amount of funds required to make
such payment.
The Series H Bonds shall have such other terms and provisions as are
provided in the form thereof attached hereto as Exhibit A, and shall be
issued in substantially such form.
2. The undersigned has read all of the covenants and conditions contained
in the Indenture, and the definitions in the Indenture relating thereto,
relating to the issuance of the Series H Bonds and in respect of compliance with
which this certificate is made.
3. The statements contained in this certificate are based upon the
familiarity of the undersigned with the Indenture, the documents accompanying
this certificate, and upon discussions by the undersigned with officers and
employees of the Company familiar with the matters set forth herein.
4. In the opinion of the undersigned, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenants and conditions have been complied with.
In the opinion of the undersigned, such conditions and covenants have
been complied with.
4
IN WITNESS WHEREOF, the undersigned has executed this
Officer's Certificate on this 10th day of October, 2002.
By: /s/ Marc Kilbride
----------------------------------------
Name: Marc Kilbride
Title: Vice President and Treasurer
Acknowledged and Received on
October 10, 2002
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Ronda L. Parmen
-----------------------------------------
Name: Ronda L. Parmen
Title: Vice President and Trust Officer
5
EXHIBIT A
FORM OF SERIES H BOND
6
NOTE: THE HOLDER OF THIS BOND BY ACCEPTANCE HEREOF AGREES TO RESTRICTIONS ON
TRANSFER AND TO INDEMNIFICATION PROVISIONS AS SET FORTH BELOW. IN ADDITION, THE
BOND REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND SUCH BOND MAY NOT BE TRANSFERRED WITHOUT COMPLIANCE
WITH APPLICABLE SECURITIES LAWS.
THIS BOND IS NOT TRANSFERABLE EXCEPT, AS FURTHER PROVIDED HEREIN, TO A SUCCESSOR
OR ASSIGN OF THE TRUST INDENTURE TRUSTEE UNDER THE TRUST INDENTURE REFERRED TO
HEREIN AMONG THE ISSUER AND THE TRUST INDENTURE TRUSTEE.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
General Mortgage Bonds, Series H, due June 1, 2026
Original Interest Accrual Date: October 10, 2002 Redeemable by Company: Yes _ No X
Stated Maturity: June 1, 2026 Redemption Date: N/A
Interest Rate: See below Redemption Price: N/A
Interest Payment Dates: See below
Regular Record Dates: N/A
This Security is not an Original Discount Security
within the meaning of the within-mentioned Indenture.
-----------------------------
Principal Amount
$100,000,000 No. H-1
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC, a corporation duly organized and
existing under the laws of the State of Texas (herein called the "Company,"
which term includes any successor under the Indenture referred to below), for
value received, hereby promises to pay to JPMorgan Chase Bank as Trustee under
the Trust Indenture (as herein defined) or its registered assigns (the
"Indenture Trustee"), the principal sum of ONE HUNDRED MILLION DOLLARS, in whole
or in installments on such date or dates as the Issuer (as defined herein) has
any obligations under the Trust Indenture (as amended and supplemented, the
"Trust Indenture"), dated as of April 1, 1999, between Matagorda County
Navigation District Number One (the "Issuer") and the Indenture Trustee (as
successor) to repay any principal in respect of the Bonds (as such term is
defined in the Trust Indenture, and hereinafter referred to as the "Series 1999A
MC Bonds"), excluding any payment of principal in advance of the final scheduled
maturity date thereof, but not later than the Stated Maturity specified above.
The obligation of the Company to make any payment of principal on this Bond,
whether at maturity or otherwise, shall be fully or partially, as the case may
be, deemed to have been paid or otherwise satisfied and discharged to the extent
CenterPoint Energy, Inc. ("CenterPoint") has paid to the Indenture Trustee the
Installment Payment (as defined below) in respect of the principal then due and
payable on the Series 1999A MC Bonds.
Interest shall be payable on this Bond on each Interest Payment Date (as
hereinafter defined) at such rate per annum as shall cause the amount of
interest payable on such Interest Payment Date on this Bond to equal the amount
of regularly scheduled interest payable on such Interest Payment Date in respect
of the Series 1999A MC Bonds under the Trust Indenture. Such interest shall be
payable on the same dates as interest is payable from time to time in respect of
the Series 1999A MC Bonds pursuant to the Trust Indenture (each such date herein
called an "Interest Payment Date"), until the maturity of this Bond, or, if the
Company shall default in the payment of the principal due on this Bond, until
the Company's obligation with respect to the payment of such principal shall be
discharged as provided in the Indenture. The amount of interest payable from
time to time in respect of the Series 1999A MC Bonds under the Trust Indenture,
the basis on which such interest is computed and the dates on which such
interest
1
is payable are set forth in the Trust Indenture. This Bond shall bear interest
(a) from the Interest Payment Date next preceding the date of this Bond to which
interest has been paid, or (b) if the date of this Bond is an Interest Payment
Date to which interest has been paid, then from such date, or (c) if no interest
has been paid on this Bond, then from the date of initial authentication of this
Bond. The obligation of the Company to make any payment of interest on this Bond
shall be fully or partially, as the case may be, deemed to have been paid or
otherwise satisfied and discharged to the extent that CenterPoint has paid to
the Indenture Trustee the Installment Payment in respect of the interest then
due and payable on the Series 1999A MC Bonds.
This Bond is issued to the Trust Indenture Trustee as security for the payment
by CenterPoint of the Installment Payments, as defined in, and pursuant to the
Installment Payment and Bond Amortization Agreement, dated as of April 1, 1999,
between Matagorda County Navigation District Number One and CenterPoint (as
successor). This Bond shall be held by the Trust Indenture Trustee subject to
the terms of the Collateral Agreement (Series H Bonds), of October 10, 2002,
between the Company and the Indenture Trustee. Any capitalized terms used herein
and not defined herein shall have the meanings specified in the Indenture (as
defined below), unless otherwise noted.
The Indenture Trustee shall surrender this Bond to the Trustee when all of the
principal of and interest on the Series 1999A MC Bonds shall have been duly
paid, and the Trust Indenture shall have been terminated.
Payments of the principal of and interest on this Bond shall be made at the
Corporate Trust Office of JPMorgan Chase Bank, as Trustee, located at 600 Travis
Street, Suite 1150, Houston, Texas 77002, or at such other office or agency as
may be designated for such purpose by the Company from time to time. Payment of
the principal of and interest on this Bond, as aforesaid, shall be made in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for the payment of public and private debts.
This Bond is one of a duly authorized issue of securities of the Company (herein
called the "Securities"), issued and issuable in one or more series under and
equally secured by a General Mortgage Indenture, dated as of October 10, 2002
(such Indenture as originally executed and delivered and as supplemented or
amended from time to time thereafter, together with any constituent instruments
establishing the terms of particular Securities, being herein called the
"Indenture"), between the Company and JPMorgan Chase Bank, as trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the property mortgaged, pledged and held in
trust, the nature and extent of the security and the respective rights,
limitations of rights, duties and immunities of the Company, the Trustee and the
Holders of the Securities thereunder and of the terms and conditions upon which
the Securities are, and are to be, authenticated and delivered and secured. The
acceptance of this Bond shall be deemed to constitute the consent and agreement
by the Holder hereof to all of the terms and provisions of the Indenture. This
Bond is one of the series designated above.
The Bonds of this series will not be entitled to the benefit of any sinking fund
or voluntary redemption provisions.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of this Bond may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the Trustee
to enter into one or more supplemental indentures for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, the Indenture with the consent of the Holders of not less than a majority in
aggregate principal amount of the Securities of all series then Outstanding
under the Indenture, considered as one class; PROVIDED, HOWEVER, that if there
shall be Securities of more than one series Outstanding under the Indenture and
if a proposed supplemental indenture shall directly affect the rights of the
Holders of Securities of one or more, but less than all, of such series, then
the consent only of the Holders of a majority in aggregate principal amount of
the Outstanding Securities of all series so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that if the Securities of any
series shall have been issued in more than one Tranche and if the proposed
supplemental indenture shall directly affect the rights of the Holders of
Securities of one or more, but less than all, of such Tranches, then the consent
only of the Holders of a majority in aggregate principal amount of the
Outstanding Securities of all Tranches so directly affected, considered as one
class, shall be required; and PROVIDED, FURTHER, that the Indenture permits the
Trustee to enter into one or more supplemental indentures for limited purposes
without the consent of any Holders of Securities. The Indenture also contains
provisions
2
permitting the Holders of a majority in principal amount of the Securities then
Outstanding, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Bond shall be conclusive and binding upon such Holder and upon
all future Holders of this Bond and of any Security issued upon the registration
of transfer hereof or in exchange therefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Bond.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Bond is registrable in the Security Register, upon
surrender of this Bond for registration of transfer at the Corporate Trust
Office of JPMorgan Chase Bank in Houston, Texas or such other office or agency
as may be designated by the Company from time to time, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Bonds of this
series of authorized denominations and of like tenor and aggregate principal
amount, will be issued to the designated transferee or transferees.
The Company, the Trustee and any agent of the Company or the Trustee may deem
and treat the person in whose name this Bond shall be registered upon the
Security Register for the Bonds of this series as the absolute owner of such
Bond for the purpose of receiving payment of or on account of the principal of
and interest on this Bond and for all other purposes, whether or not this Bond
be overdue, and neither the Company nor the Trustee shall be affected by any
notice to the contrary; and all such payments so made to such registered owner
or upon his order shall be valid and effectual to satisfy and discharge the
liability upon this Bond to the extent of the sum or sums paid.
The Trustee may conclusively presume that the obligation of the Company to pay
the principal of and interest on this Bond shall have been fully satisfied and
discharged unless and until it shall have received a written notice from the
Trust Indenture Trustee, signed by an authorized officer of the Trust Indenture
Trustee and attested by the Secretary or an Assistant Secretary of the Trust
Indenture Trustee within 90 days after the applicable Interest Payment Date,
stating that the payment of principal of or interest on this Bond has not been
fully paid when due and specifying the amount of funds required to make such
payment.
Before any transfer of this Bond by the registered holder or his or its legal
representative will be recognized or given effect by the Company or the Trustee,
the registered holder shall notify the Company and the Trustee of the name and
address of the transferee. By acceptance hereof the holder of this Bond and each
transferee shall be deemed to have agreed to indemnify and hold harmless the
Company and the Trustee against all losses, claims, damages or liability arising
out of any failure on part of the holder or of any such transferee to comply
with the requirements of the preceding sentence.
No recourse under or upon any obligation, covenant or agreement contained in the
Indenture or in any indenture supplemental thereto, or in any Bond or coupon
thereby secured, or because of any indebtedness thereby secured, shall be had
against any incorporator, member, manager, stockholder, officer, director or
employee, as such, past, present or future, of the Company or any predecessor or
successor corporation or company, either directly or through the Company or any
predecessor or successor corporation or company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture, any indenture supplemental thereto and the obligations thereby
secured, are solely corporate obligations of the Company, and that no personal
liability whatsoever shall attach to, or be incurred by, such incorporators,
members, managers, stockholders, officers, directors or employees, as such, of
the Company or of any predecessor or successor corporation or company, or any of
them, because of the creation of the indebtedness thereby authorized, or under
or by reason of any of the obligations, covenants or agreements contained in the
Indenture or in any indenture supplemental thereto or in any of the Bonds or
coupons thereby secured, or implied therefrom.
This Bond shall be governed by and construed in accordance with the law of the
State of New York except as provided in the Indenture.
Unless the certificate of authentication hereon has been executed by the Trustee
or an Authenticating Agent by manual signature, this Bond shall not be entitled
to any benefit under the Indenture or be valid or obligatory for any
3
purpose.
[The remainder of this page is intentionally left blank.]
4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
By: _____________________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Date of Authentication: ______, 2002
JPMORGAN CHASE BANK, as Trustee
By: _____________________________________
Authorized Signatory
5