1
EXHIBIT 4.1
================================================================================
CEDAR BRAKES I, L.L.C.,
Issuer,
and
Bankers Trust Company,
Trustee, Paying Agent and Registrar
----------
INDENTURE
Dated as of September 26, 2000
$310,600,000 8.50% Senior Secured Bonds due 2014
----------
================================================================================
2
CEDAR BRAKES I, L.L.C.
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT
OF 1939 AND INDENTURE, DATED AS OF SEPTEMBER 26, 2000
TRUST INDENTURE ACT SECTION INDENTURE SECTION
Section 310 (a)(1) ................................... 808
(a)(2) ................................... 808
(b) ................................... 808, 810
Section 311 (a) ................................... 813
(b) ................................... 813
Section 312 (a) ................................... 901
(b) ................................... 902
(c) ................................... 902
Section 313 (a) ................................... 903
(b) ................................... 903
(c) ................................... 903
(d) ................................... 903
Section 314 (a) ................................... 904, 1106
(b) ................................... 1111
(c)(1) ................................... 102
(c)(2) ................................... 102
(d) ................................... 1111
(e) ................................... 102
Section 315 (a) ................................... 801
(b) ................................... 720
(c) ................................... 801
(d) ................................... 801
(e) ................................... 721
Section 316 (a) (last sentence).................... 101 ("Outstanding")
(a)(1)(A) ................................... 702, 717
(a)(1)(B) ................................... 718
(b) ................................... 713
i
3
TRUST INDENTURE ACT SECTION INDENTURE SECTION
(c) ................................... 104(d)
Section 317 (a)(1) ................................... 708, 709
(a)(2) ................................... 709
(b) ................................... 1115
Section 318 (a) ................................... 111
(c) ................................... 111
- ----------
Note: This reconciliation and tie shall not, for any purpose, be deemed part of
the Indenture
ii
4
TABLE OF CONTENTS
Page
----
RECITALS.................................................................................................1
GRANTING CLAUSE..........................................................................................1
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION...................................2
SECTION 101. Definitions.......................................................................2
SECTION 102. Compliance Certificates and Opinions..............................................3
SECTION 103. Form of Documents Delivered to Trustee............................................4
SECTION 104. Acts of Holders...................................................................4
SECTION 105. Notices, Etc. to Trustee and Issuer...............................................5
SECTION 106. Notice to Holders; Waiver.........................................................6
SECTION 107. Effect of Headings and Table of Contents..........................................6
SECTION 108. Successors and Assigns............................................................6
SECTION 109. Severability Clause...............................................................6
SECTION 110. Benefits of Indenture.............................................................6
SECTION 111. Conflict with Trust Indenture Act.................................................7
SECTION 112. Governing Law; Consent to Jurisdiction and Service of Process.....................7
SECTION 113. Legal Holidays....................................................................8
SECTION 114. Incorporators, Shareholders, Officers and Directors of Issuer Exempt from
Individual Liability..........................................................8
SECTION 115. Execution in Counterparts.........................................................8
ARTICLE TWO FORM OF BONDS ............................................................................8
SECTION 201. Form of Bond......................................................................8
SECTION 202. Restrictive Legends..............................................................10
ARTICLE THREE THE BONDS .............................................................................12
SECTION 301. Amount ..........................................................................12
SECTION 302. Denominations....................................................................14
SECTION 303. Execution, Authentication, Delivery and Dating...................................14
SECTION 304. Temporary Bonds..................................................................15
SECTION 305. Registration, Registration of Transfer and Exchange..............................15
SECTION 306. Book Entry Provisions for Global Bonds...........................................16
SECTION 307. Special Transfer Provisions......................................................18
SECTION 308. Mutilated, Destroyed, Lost and Stolen Bonds......................................20
i
5
SECTION 309. Payment of Principal and Interest; Principal and Interest Rights Preserved.......21
SECTION 310. Persons Deemed Owners............................................................22
SECTION 311. Cancellation.....................................................................23
SECTION 312. Computation of Interest..........................................................23
SECTION 313. CUSIP and CINS Numbers...........................................................23
SECTION 314. Parity of Bonds..................................................................23
ARTICLE FOUR APPLICATION OF PROCEEDS FROM SALE OF BONDS..............................................23
SECTION 401. Application of Proceeds from Sale of Bonds.......................................23
ARTICLE FIVE ACCOUNTS ...............................................................................24
SECTION 501. Establishment of Accounts........................................................24
SECTION 502. Collections Account..............................................................24
SECTION 503. Liquidity Account................................................................25
SECTION 504. Damages and Indemnity Account....................................................27
SECTION 505. Statements: Investment of Funds..................................................27
ARTICLE SIX SATISFACTION AND DISCHARGE...............................................................28
SECTION 601. Satisfaction and Discharge of Indenture..........................................28
SECTION 602. Application of Trust Money.......................................................29
ARTICLE SEVEN REMEDIES ..............................................................................29
SECTION 701. Events of Default................................................................29
SECTION 702. Acceleration of Maturity; Rescission and Annulment...............................31
SECTION 703. Remedies Upon an Event of Default................................................32
SECTION 704. Certain Sales of Collateral......................................................33
SECTION 705. No Marshaling....................................................................33
SECTION 706. Trustee May Recover Unpaid Indebtedness after Sale of Collateral.................33
SECTION 707. Recovery of Judgment Does Not Affect Rights......................................33
SECTION 708. Collection of Indebtedness and Suits for Enforcement by Trustee..................33
SECTION 709. Trustee May File Proofs of Claim.................................................34
SECTION 710. Trustee May Enforce Claims Without Possession of Bonds...........................35
SECTION 711. Application of Money Collected...................................................35
SECTION 712. Limitation on Suits..............................................................35
SECTION 713. Unconditional Right of Holders to Receive Principal, Make-Whole Premium and
Interest.....................................................................36
SECTION 714. Restoration of Rights and Remedies...............................................36
ii
6
SECTION 715. Rights and Remedies Cumulative...................................................36
SECTION 716. Delay or Omission Not Waiver.....................................................37
SECTION 717. Control by Holders...............................................................37
SECTION 718. Waiver of Past Defaults..........................................................37
SECTION 719. Waiver of Stay or Extension Laws.................................................37
SECTION 720. Trustee to Give Notice of Default, But May Withhold in Certain Circumstances.....38
SECTION 721. Undertaking for Costs............................................................38
ARTICLE EIGHT THE TRUSTEE ...........................................................................38
SECTION 801. Duties and Responsibilities of the Trustee; During Default; Prior to Default.....38
SECTION 802. Certain Rights of Trustee........................................................39
SECTION 803. Trustee Not Responsible for Recitals or Issuance of Bonds........................41
SECTION 804. May Hold Bonds...................................................................41
SECTION 805. Money Held In Trust..............................................................41
SECTION 806. Compensation and Indemnification of Trustee, Paying Agent and Registrar and Its
Prior Claim..................................................................41
SECTION 807. Right of Trustee to Rely on Officer's Certificate, Etc...........................42
SECTION 808. Corporate Trustee Required; Eligibility..........................................42
SECTION 809. Qualification of Trustee; Conflicting Interests..................................43
SECTION 810. Resignation and Removal; Appointment of Successor Trustee........................43
SECTION 811. Acceptance of Appointment by Successor...........................................44
SECTION 812. Merger, Conversion, Consolidation or Succession to Business......................45
SECTION 813. Preferential Collection of Claims Against Issuer.................................45
SECTION 814. No Liability for Clean-up of Hazardous Materials.................................45
SECTION 815. Registrar and Paying Agents......................................................46
SECTION 816. Filing Fees......................................................................46
SECTION 817. Fee Agreement....................................................................46
ARTICLE NINE HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER........................................46
SECTION 901. Holder Lists.....................................................................46
SECTION 902. Disclosure of Names and Addresses of Holders.....................................46
SECTION 903. Reports by Trustee...............................................................47
SECTION 904. Reports by Issuer................................................................47
iii
7
ARTICLE TEN SUPPLEMENTS AND AMENDMENTS TO INDENTURE AND SECURITY DOCUMENTS...........................48
SECTION 1001. Without Vote of Holders.........................................................48
SECTION 1002. With Consent of Holders.........................................................48
SECTION 1003. Execution of Supplemental Indentures............................................49
SECTION 1004. Effect of Supplemental Indentures...............................................50
SECTION 1005. Conformity with Trust Indenture Act.............................................50
SECTION 1006. Reference in Bonds to Supplemental Indentures...................................50
SECTION 1007. Notice of Supplemental Indentures...............................................50
ARTICLE ELEVEN AFFIRMATIVE COVENANTS.................................................................50
SECTION 1101. Payment of Principal and Interest...............................................50
SECTION 1102. Maintenance of Office or Agency.................................................50
SECTION 1103. Maintenance of Existence, Properties............................................51
SECTION 1104. Payments of Taxes and Other Claims..............................................51
SECTION 1105. Material Agreements.............................................................51
SECTION 1106. Notice of Certain Events........................................................51
SECTION 1107. Compliance with Laws and Other Agreements.......................................52
SECTION 1108. Maintenance of Books and Records................................................52
SECTION 1109. Approvals.......................................................................52
SECTION 1110. Rule 144A Information for the Holders...........................................53
SECTION 1111. Recording.......................................................................53
SECTION 1112. Further Assurances..............................................................53
SECTION 1113. Opinions as to Collateral.......................................................53
SECTION 1114. Performance of Obligations......................................................54
SECTION 1115. Money for Bond Payments to be Held in Trust.....................................54
SECTION 1116. Schedule and Delivery of Energy under the Amended and
Restated Power Purchase Agreement...............................................54
ARTICLE TWELVE NEGATIVE COVENANTS....................................................................54
SECTION 1201. Liens ..........................................................................54
SECTION 1202. Indebtedness....................................................................55
SECTION 1203. Guarantees......................................................................55
SECTION 1204. Transactions With Affiliates....................................................55
SECTION 1205. Investments, Loans and Advances.................................................55
SECTION 1206. Material Agreements; Additional Contracts.......................................55
SECTION 1207. Fundamental Change..............................................................55
SECTION 1208. Restricted Payments.............................................................55
ARTICLE THIRTEEN REDEMPTION OF BONDS.................................................................56
SECTION 1301. Applicability of Article........................................................56
SECTION 1302. Election to Redeem; Notice to Trustee...........................................56
SECTION 1303. Selection by Trustee of Bonds to Be Redeemed....................................56
SECTION 1304. Notice of Redemption............................................................56
iv
8
SECTION 1305. Deposit of Redemption Price.....................................................57
SECTION 1306. Bonds Payable on Redemption Date................................................57
SECTION 1307. Bonds Redeemed in Part..........................................................58
ARTICLE FOURTEEN DEFEASANCE AND COVENANT DEFEASANCE..................................................58
SECTION 1401. Issuer's Option to Effect Defeasance or Covenant Defeasance.....................58
SECTION 1402. Defeasance and Discharge........................................................58
SECTION 1403. Covenant Defeasance.............................................................58
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.................................59
SECTION 1405. Deposited Money to Be Held in Trust; Other Miscellaneous Provisions.............60
SECTION 1406. Reinstatement...................................................................60
ARTICLE FIFTEEN MEETINGS OF HOLDERS OF BONDS.........................................................61
SECTION 1501. Purposes for Which Holders' Meetings May Be Called..............................61
SECTION 1502. Call of Meetings by Trustee.....................................................61
SECTION 1503. Issuer and Holders May Call Meeting.............................................61
SECTION 1504. Persons Entitled to Vote at Meeting.............................................62
SECTION 1505. Determination of Voting Rights: Conduct and Adjournment of Meeting..............62
SECTION 1506. Counting Votes and Recording Action of Meeting..................................63
Exhibit A - Definitions
Exhibit B - Form of Bond
Exhibit C - Form of Certificate to Be Delivered upon Termination of
Restricted Period
Exhibit D - Form of Certificate to Be Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
Exhibit E - Form of Certificate to Be Delivered in Connection with
Transfers Pursuant to Regulation S
Exhibit F - Form of Guaranty to Be Provided in Connection with Withdrawals
from the Liquidity Account
v
9
THIS INDENTURE, dated as of September 26, 2000 between CEDAR
BRAKES I, L.L.C., a limited liability company organized and existing under the
laws of the State of Delaware, having its principal executive offices at 1001
Louisiana Street, Houston, Texas 77002 (the "Issuer") and Bankers Trust Company,
as trustee (the "Trustee").
RECITALS
WHEREAS, the Issuer has duly authorized the execution and
delivery of this Indenture to provide for the creation and issuance of 8.50%
senior secured bonds due 2014 in the aggregate principal amount of $310,600,000
(the "Bonds");
WHEREAS, all necessary actions to ensure that this Indenture
is a valid indenture and agreement according to its terms have been taken;
WHEREAS, as security for the payment and performance by the
Issuer of its obligations under this Indenture and the Bonds, the Issuer has
agreed to assign the Collateral (as defined below) as collateral to the Trustee
on behalf of the Holders; and
WHEREAS, the Trustee has agreed to act as trustee under this
Indenture on the following terms and conditions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that, for and in
consideration of the premises herein contained and the purchase of the Bonds by
the Holders thereof, it is mutually covenanted and agreed, for the benefit of
the parties hereto and the equal and proportionate benefit of all Holders of the
Bonds, as follows:
GRANTING CLAUSE
The Issuer hereby Grants to the Trustee on and as of the
Closing Date, on behalf of and for the equal and proportionate benefit of the
Holders, all of the Issuer's right, title, interest and benefit in and to (a)
the Material Agreements; (b) the Collections and all amounts payable to the
Issuer arising out of, attributable to, in respect of or otherwise in connection
with, the Collections; (c) all other amounts payable to the Issuer pursuant to
the Material Agreements; (d) the Accounts and all funds and all investments and
proceeds on deposit therein from time to time; (e) all damages and other amounts
payable to the Issuer in respect of any of the foregoing; (f) all rights,
claims, powers, privileges and remedies (whether mandatory, discretionary or
judgmental) of the Issuer, whether arising by contract, at law, in equity or
otherwise with respect to any of the foregoing; and (g) all present and future
claims, demands, causes and choses in action in respect of any or all of the
foregoing and all payments on or under and all proceeds of every kind and nature
whatsoever in respect of any or all of the foregoing, including all proceeds of
the conversion, voluntary or involuntary, into cash or other liquid property,
all cash proceeds, accounts, accounts receivable, bonds, drafts, acceptances,
chattel paper, checks, deposit accounts, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Collateral").
1
10
The Trustee on behalf of the Holders acknowledges such Grant.
The Trustee on behalf of the Holders accepts the trusts under this Indenture in
accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the end that the equal and proportional
interests of the Holders may be adequately and effectively protected.
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(a) capitalized terms used herein shall have the respective
meanings assigned to them in Exhibit A;
(b) the terms defined in Exhibit A include the plural as well
as the singular;
(c) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision;
(e) except as otherwise expressly provided herein, (i) all
accounting terms used herein shall be interpreted, (ii) all financial
statements and all certificates and reports as to financial matters
required to be delivered to the Trustee hereunder shall be prepared and
(iii) all calculations made for the purposes of determining compliance
with this Indenture shall (except as otherwise expressly provided
herein) be made in accordance with, or by application of, GAAP applied
on a basis consistent with those used in the preparation of the latest
corresponding financial statements furnished hereunder to Trustee;
(f) all references in this Indenture to "Articles,"
"Sections," "Exhibits" and other subdivisions of this Indenture are to
the designated articles, sections and other subdivisions of, and the
exhibits to, this Indenture;
(g) unless otherwise expressly specified or the context
otherwise requires, all references in this Indenture or any Exhibit to
any agreement, contract or document (including this Indenture) shall
include reference to all exhibits to such agreement, contract or
document;
(h) unless otherwise expressly specified or the context
otherwise requires, any agreement, contract or document defined or
referred to herein shall mean such agreement, contract or document as
in effect as of the date hereof, as the same may thereafter be
2
11
amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof and hereof;
(i) unless otherwise expressly specified or the context
otherwise requires, pronouns having a masculine or feminine gender
shall be deemed to include the other;
(j) any reference to any Person shall include its permitted
successors and assigns in accordance with the terms of this Indenture
and the other Financing Documents and, in the case of any Governmental
Agency, any Person succeeding to its functions and capacities; and
(k) the term "including" denotes an example and not a
limitation.
SECTION 102. Compliance Certificates and Opinions. Upon any
application or request by the Issuer to the Trustee to take any action under any
provision of this Indenture, the Issuer shall furnish to the Trustee an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Indenture (including any covenant compliance with which constitutes
a condition precedent) relating to the proposed action have been complied with
and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that in the case
of any application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every Officer's Certificate or Opinion of Counsel with respect
to compliance with a covenant or condition provided for in this Indenture shall
include: (1) a statement that each individual signing such Officer's Certificate
or Opinion of Counsel has read such covenant or condition and the definitions
herein relating thereto; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such Officer's Certificate or Opinion of Counsel are based; (3) a statement
that, in the opinion of each such individual, he has made such examination or
investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenant or condition has been complied with; (4) a
statement as to whether, in the opinion of each such individual, such covenant
or condition has been complied with; and (5) a statement that, in the opinion of
each such individual, such Officer's Certificate or Opinion of Counsel complies
with the provisions of this Section 102 and that the Trustee may rely on such
Officer's Certificate or Opinion of Counsel.
Any certificate, statement or opinion of an officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or Opinion of Counsel or representations by counsel (which shall also be
addressed to the Trustee and the Holders), unless such officer knows that the
certificate or Opinion of Counsel or representations with respect to the matters
upon which his certificate, statement or Opinion of Counsel will be based are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous. Any certificate, statement or Opinion of Counsel may be based,
insofar as it relates to factual matters or information which is in the
possession of the Issuer, upon the certificate, statement or opinion of or
representations by an officer or officers of the Issuer, unless such counsel
knows that the certificate, statement or
3
12
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the
Issuer or of counsel may be based, insofar as it relates to accounting matters,
upon a certificate or opinion of an Accountant in the employ of the Issuer
(which shall be additionally addressed to the Trustee and the Holders), unless
such officer or counsel, as the case may be, knows that the certificate or
opinion with respect to the accounting matters upon which his certificate,
statement or opinion may be based as aforesaid are erroneous, or in the exercise
of reasonable care should know that the same are erroneous.
Any certificate or opinion of any Independent Accountant filed
with the Trustee shall contain a statement that such Accountant is Independent.
SECTION 103. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 104. Acts of Holders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders may be embodied in and
evidenced by (1) one or more instruments of substantially similar tenor signed
by the Holders in person or by their respective agents or proxies duly appointed
in writing, (2) the record of Holders voting in favor thereof, either in person
or by their respective agents or proxies duly appointed in writing, at any
meeting of Holders duly called and held in accordance with the provisions of
Article Fifteen, or (3) a combination of such instruments and any such record.
Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or both are delivered to
the Trustee and, where it is expressly required hereby, to the Issuer. Such
instrument or instruments and any such record (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments or so voting at any such meeting.
Proof of execution of any such instrument or of a writing appointing any such
agent, or of the holding by any Person of a Bond, shall be sufficient for any
purpose of this Indenture and conclusive in favor of the Trustee and the Issuer,
if made in the manner provided in this Section. The record of any meeting of
Holders shall be proved in the manner provided in Section 1506.
4
13
(b) The affidavit of a witness of such execution sworn to
before a notary public or other officer authorized by law to take
acknowledgments of deeds or administer oaths, or by a certificate of such notary
or other officer, certifying that the individual signing such instrument or
writing acknowledged to him the execution thereof shall be conclusive evidence
of the fact and date of execution by any Person of any such instrument or
writing. Where such execution is by a signer acting in a capacity other than his
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of authority. The fact and date of the execution of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner which the Trustee deems sufficient.
(c) Entries in the Security Register shall be conclusive
evidence of the principal amount and serial numbers of Bonds held by any Person,
and the date of holding the same, and the Trustee shall not be affected by
notice to the contrary.
(d) If the Issuer shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Issuer may, at its option, by or pursuant to a Management Committee's Consent,
fix in advance a record date for the determination of Holders entitled to give
such request, demand, authorization, direction, notice, consent, waiver or other
Act, but the Issuer shall have no obligation to do so. Notwithstanding TIA
Section 316(c), such record date shall be the record date specified in or
pursuant to such Management Committee's Consent, which shall be a date not
earlier than the date thirty (30) days prior to the first solicitation of
Holders generally in connection therewith and not later than the date such
solicitation is completed unless otherwise specified herein. If such a record
date is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record date, but only the
Holders of record at the close of business on such record date shall be deemed
to be Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Bonds have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other Act,
and for that purpose the Outstanding Bonds shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than eleven (11) months
after the record date.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Bond shall bind every future
Holder of the same Bond and the Holder of every Bond issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Issuer in reliance thereon, whether or not notation of such action is made upon
such Bond.
SECTION 105. Notices, Etc. to Trustee and Issuer. Any request,
demand, authorization, direction, notice, consent, waiver or other Act of
Holders or other documents provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(a) the Trustee by any Holder or by the Issuer shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office;
or
5
14
(b) the Issuer by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Issuer addressed to it at the address of its principal
office specified in the first paragraph of this Indenture or at any
other address previously furnished in writing to the Trustee by the
Issuer.
SECTION 106. Notice to Holders; Waiver. (a) Where this
Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, or delivered by overnight courier or
facsimile, to each Holder, at its address or facsimile number (as applicable) as
it appears in the Security Register, not later than the latest date (if any),
and not earlier than the earliest date (if any), prescribed for the giving of
such notice. Where this Indenture provides for notice in any manner, such notice
and the manner of its giving may be waived in writing by the Person entitled to
receive such notice, either before or after the event and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver. In any case where notice to
Holders is given by mail or fax (as applicable), neither the failure to mail or
fax such notice, nor any defect in any notice so mailed or faxed (as the case
may be), to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders, and any notice that is mailed or faxed in the
manner herein provided shall be conclusively presumed to have been duly given,
whether or not such Holder actually receives notice.
(b) In case by reason of the suspension of or irregularities
in regular mail service or by reason of any other cause, it shall be
impracticable to mail or deliver notice of any event to Holders when such notice
is required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Trustee shall be
deemed to be a sufficient giving of such notice for every purpose hereunder.
SECTION 107. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the meaning or construction of any of the
provisions hereof.
SECTION 108. Successors and Assigns. All covenants,
stipulations, promises and agreements in this Indenture by or on behalf of each
of the Trustee and the Issuer shall bind and inure to the benefit of their
respective successors and assigns, whether so expressed or not.
SECTION 109. Severability Clause. In case any provision in
this Indenture or in any Bond shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture. Nothing in this Indenture
or in the Bonds, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent, any Registrar, and their successors and
permitted assigns hereunder, and the Holders of Bonds, any benefit or any legal
or equitable right, remedy or claim under this Indenture.
6
15
SECTION 111. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with the duties imposed by the
Trust Indenture Act Sections 310 to 318, inclusive, or conflicts with any
provision of the Trust Indenture Act that is required under the Trust Indenture
Act to be a part of and govern this Indenture, such duties or provision shall
control. If any provision of this Indenture modifies or excludes any provision
of the Trust Indenture Act that may be so modified or excluded, such provision
shall be deemed to apply to this Indenture as so modified or to be excluded, as
the case may be.
SECTION 112. Governing Law; Consent to Jurisdiction and
Service of Process. (a) This Indenture and the Bonds shall be governed by, and
construed in accordance with, the laws of the State of New York (without giving
effect to the principles thereof relating to conflicts of law except Section
5-1401 of the New York General Obligations Law).
(b) The Issuer consents to the non-exclusive jurisdiction of
any court of the State of New York or any United States federal court sitting in
the Borough of Manhattan, New York City, New York, United States, and any
appellate court from any thereof, and waives any immunity from the jurisdiction
of such courts over any suit, action or proceeding that may be brought in
connection with this Indenture, the Financing Documents or the Bonds. The Issuer
irrevocably waives, to the fullest extent permitted by law, any objection to any
suit, action, or proceeding that may be brought in connection with this
Indenture, the Financing Documents or the Bonds in such courts whether on the
grounds of venue, residence or domicile or on the ground that any such suit,
action or proceeding has been brought in an inconvenient forum. The Issuer
agrees that final judgment in any such suit, action or proceeding brought in
such court shall be conclusive and binding upon the Issuer and may be enforced
in any court to the jurisdiction of which the Issuer is subject by a suit upon
such judgment.
(c) The Issuer agrees that service of all writs, process and
summonses in any suit, action or proceeding brought in connection with this
Indenture, the Financing Documents or the Bonds against the Issuer, or with
respect to its property and assets, in any court of the State of New York or any
United States federal court sitting in the Borough of Manhattan, New York City
may be made upon CT Corporation System at 111 Eighth Avenue, 13th Floor, New
York, NY 10011, whom the Issuer appoints as its authorized agent for service of
process. The Issuer represents and warrants that CT Corporation System has
agreed to act as the Issuer's agent for service of process. The Issuer agrees
that such appointment shall be irrevocable so long as any of the Bonds remain
outstanding or until the irrevocable appointment by the Issuer of a successor in
New York City as its authorized agent for such purpose and the acceptance (on
terms reasonably satisfactory to the Trustee) of such appointment by such
successor. The Issuer further agrees to take any and all action, including the
filing of any and all documents and instruments, that may be necessary to
continue such appointment in full force and effect as aforesaid. If CT
Corporation System shall cease to act as the Issuer's agent for service of
process, the Issuer shall appoint without delay another such agent and provide
prompt written notice to the Trustee of such appointment. With respect to any
such action in any court of the State of New York or any United States federal
court in the Borough of Manhattan, City of New York, service of process upon CT
Corporation System, as the authorized agent of the Issuer for service of
process, and written notice of such service to the Issuer, shall be deemed in
every respect, effective service of process upon the Issuer. Without prejudice
to the foregoing, the Issuer hereby irrevocably
7
16
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to the Issuer at the address of its principal
office specified in the first paragraph of this Indenture or at any other
address previously furnished in writing to the Trustee by the Issuer.
(d) Nothing in this Section shall affect the right of any
party to serve legal process in any other manner permitted by law or affect the
right of any party to bring any action or proceeding against any other party or
its property in the courts of other jurisdictions.
SECTION 113. Legal Holidays. If any Payment Date, Redemption
Date or Stated Maturity of any Bond or of any installment of principal thereof
or payment of interest thereon, or any date on which any defaulted interest is
proposed to be paid, shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of any Bond) payment
of interest or principal (and Make-Whole Premium, if any) need not be made at
such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made
on the Payment Date or Redemption Date, or at the Stated Maturity, or on the
date on which the defaulted interest is proposed to be paid; provided that no
interest shall accrue on the amount then due for the period from and after such
Payment Date, Redemption Date, Stated Maturity or the date on which the
defaulted interest is proposed to be paid, as the case may be, to the date of
such payment.
SECTION 114. Incorporators, Shareholders, Officers and
Directors of Issuer Exempt from Individual Liability. Except as otherwise
specifically provided in the Material Agreements, no recourse under or upon any
obligation, covenant or agreement contained in this Indenture, any Security
Document or any Bond, or because of any indebtedness evidenced thereby, shall be
had against any incorporator, as such, or against any past, present or future
stockholder, member, manager, officer or director, as such, of the Issuer or of
any successor, either directly or through the Issuer or any successor, under any
rule of law, statute, or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the Bonds by
the Holders thereof and as part of the consideration for the issuance of the
Bonds. Nothing contained in this Section 114 shall, however, limit the liability
of any of the foregoing for any fraud, gross-negligence or willful misconduct on
their part.
SECTION 115. Execution in Counterparts. This instrument may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one of the same instrument.
ARTICLE TWO
FORM OF BONDS
SECTION 201. Form of Bond. The Bonds and the Trustee's
certificate of authentication shall be in substantially the form annexed hereto
as Exhibit B. The Bonds may
8
17
have such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture and may have letters, notations
or other marks of identification and such notations, legends or endorsements
required by law, stock exchange agreements to which the Issuer is subject or
usage. Any portion of the text of any Bond may be set forth on the reverse
thereof, with an appropriate reference thereto on the face of the Bond. The
Issuer shall approve the form of the Bonds and any notation, legend or
endorsement on the Bonds. Each Bond shall be dated the date of its
authentication.
The definitive Bonds shall be printed, lithographed or
engraved on steel-engraved borders or may be produced in any other manner
permitted by the rules under any applicable securities laws, all as determined
by the officers of the Issuer executing such Bonds, as evidenced by their
execution of such Bonds.
The terms and provisions contained in the form of the Bonds
annexed hereto as Exhibit B shall constitute, and are hereby expressly made, a
part of this Indenture. To the extent applicable, the Issuer and the Trustee, by
their execution and delivery of this Indenture, and the Holders and beneficial
owners of the Bonds by their acceptance of the Bonds expressly agree to such
terms and provisions and to be bound thereby.
Bonds offered and sold to QIBs in reliance on Rule 144A shall
be issued initially in the form of one or more permanent global Bonds in
registered form, substantially in the form set forth in Exhibit B (each, a "Rule
144A Global Bond"), deposited with, or on behalf of, DTC or with the Trustee, as
custodian for DTC, duly executed by the Issuer and authenticated by the Trustee
as hereinafter provided. The aggregate principal amount of each Rule 144A Global
Bond may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for DTC or its nominee, as hereinafter
provided.
Bonds offered and sold in offshore transactions in reliance on
Regulation S shall be initially issued in the form of one or more temporary
global Bonds in registered form, substantially in the form set forth in Exhibit
B (each, a "Temporary Regulation S Global Bond"), deposited with, or on behalf
of, DTC or with the Trustee, as custodian for DTC for the accounts of Euroclear
and Clearstream Luxembourg, duly executed by the Issuer and authenticated by the
Trustee as hereinafter provided. Each Temporary Regulation S Global Bond will be
exchangeable for one or more permanent global Bonds (each, a "Permanent
Regulation S Global Bond"; and together with the Temporary Regulation S Global
Bonds, the "Regulation S Global Bonds") after the 40th day following the Closing
Date upon certification (substantially in the form of Exhibit C) that the
beneficial interests in such global Bond are owned by either Non-U.S. Persons or
U.S. Persons who purchased such interests pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act.
The aggregate principal amount of each Regulation S Global Bond may from time to
time be increased or decreased by adjustments made in the records of the
Trustee, as custodian for DTC or its nominee, as herein provided.
Bonds offered and sold to institutional "accredited investors"
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) who are
not QIBs (excluding Non-U.S. Persons) shall initially be issued in the form of
permanent certificated Bonds in registered form
9
18
in substantially the form of Exhibit B ("U.S. Physical Bonds"). Bonds issued
pursuant to Section 306 in exchange for or upon transfer of interests in a Rule
144A Global Bond or a Regulation S Global Bond shall be in the form of U.S.
Physical Bonds and permanent certificated Bonds in registered form substantially
in the form set forth in Exhibit B (the "Regulation S Physical Bond"),
respectively.
The U.S. Physical Bonds and the Regulation S Physical Bonds
are sometimes collectively herein referred to as the "Physical Bonds". The
Regulation S Global Bonds and the Rule 144A Global Bonds are sometimes
collectively referred to as the "Global Bonds."
SECTION 202. Restrictive Legends. Unless and until a Bond is
sold under an effective Registration Statement, (i) each Rule 144A Global Bond
and each U.S. Physical Bond shall bear the legend set forth below (the "Private
Placement Legend") on the face thereof and (ii) each Regulations S Global Bond
and each Regulation S Physical Bond shall bear the legend set forth below on the
face thereof until at least November 6, 2000 and receipt by the Issuer and the
Trustee of a certificate substantially in the form of Exhibit C:
THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS BOND NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED,
RESOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS. THE HOLDER OF THIS BOND BY ITS ACCEPTANCE HEREOF AGREES THAT ANY
OFFER, SALE OR OTHER TRANSFER OF SUCH SECURITY, PRIOR TO THE DATE WHICH
IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE
LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE
OWNER OF THIS BOND (OR ANY PREDECESSOR OF THIS BOND)(THE "RESALE
RESTRICTION TERMINATION DATE"), SHALL ONLY BE MADE: (A) TO THE ISSUER
OR ANY SUBSIDIARY, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE BONDS ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO
A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER",
AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT
THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE
10
19
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS
ACQUIRING THIS BOND FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES ONLY AND
NOT WITH A VIEW TO, OR FOR OFFER OR RESALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
ISSUER'S AND THE TRUSTEE'S RIGHT, PRIOR TO ANY SUCH OFFER, RESALE OR
TRANSFER (i) PURSUANT TO CLAUSE (D) PRIOR TO THE END OF THE 40-DAY
DISTRIBUTION COMPLIANCE PERIOD WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT OR PURSUANT TO CLAUSE (E) OR (F) PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE, TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE
EACH OF THEM AND FURTHER SUBJECT, IN EACH OF THE FOREGOING CASES,
EXCEPT (D), TO COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS, AND
(ii) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE.
Each Global Bond, whether or not a Bond, shall also bear the
following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC OR SUCH OTHER REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO ANY OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY
11
20
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL BOND SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL BOND
SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTIONS 306 AND 307 OF THE INDENTURE. THE HOLDER OF THIS
GLOBAL BOND REPRESENTS THAT (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN AS
DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA") (AN "ERISA PLAN") OR OTHER PLAN, AN
ENTITY WHOSE UNDERLYING ASSETS INCLUDE THE ASSETS OF ANY SUCH ERISA
PLAN OR OTHER PLAN OR A GOVERNMENTAL PLAN THAT IS SUBSTANTIALLY SIMILAR
TO THE PROVISIONS OF SECTION 406 OF ERISA OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR (II) THE
PURCHASE AND HOLDING BY IT OF THIS BOND WILL NOT RESULT IN A PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR,
IN THE CASE OF A GOVERNMENTAL PLAN, ANY SUBSTANTIALLY SIMILAR FEDERAL,
STATE OR LOCAL LAW) FOR WHICH AN EXEMPTION IS NOT AVAILABLE.
ARTICLE THREE
THE BONDS
SECTION 301. Amount. The Bonds to be issued under this
Indenture are hereby created, and the maximum aggregate principal amount of
Bonds which may be authenticated and delivered under this Indenture is
$310,600,000.
The Bonds shall be known and designated as the "8.50% Senior
Secured Bonds Due 2014" of the Issuer. The Stated Maturity of the Bonds shall be
February 15, 2014. Interest on the Bonds will accrue at the rate of 8.50% per
annum, from Closing Date, or from the most recent Interest Payment Date on which
interest has been paid or duly provided for, payable each applicable Interest
Payment Date, until the full principal thereof is paid or duly provided for;
provided, that, in the event that an Exchange Offer (as defined in the
Registration Rights Agreement) has not been consummated or filed, with respect
to the Bonds, on or before the date which is two hundred and seventy (270) days
after the Closing Date or a Shelf Registration Statement (as defined in the
Registration Rights Agreement), with respect to the Bonds, has not been filed or
declared effective within the time period specified in the Registration Rights
Agreement, additional interest shall accrue on the Bonds at the rate of 0.50%
per annum (such
12
21
additional interest, the "Additional Interest"), from and including the date on
which any such Registration Default (as defined in the Registration Rights
Agreement) shall occur to but precluding the date on which all such Registration
Defaults (as defined in the Registration Rights Agreement) have been cured. All
references to "interest" in this Indenture include Additional Interest.
Principal payments on the Bonds will be made on the Principal
Payment Dates in an amount equal to the outstanding principal amount on the
Closing Date multiplied by the percentage set forth opposite the applicable
Principal Payment Date on the amortization schedule set out below. The
percentages of the original principal amount payable on each Principal Payment
Date are:
Principal Payment Date % Payable
- ---------------------- ---------
February 15, 2002 1.8859
February 15, 2003 2.5345
February 15, 2004 3.5500
February 15, 2005 4.9112
February 15, 2006 5.7527
February 15, 2007 6.6977
February 15, 2008 7.7298
February 15, 2009 8.7594
February 15, 2010 9.9352
February 15, 2011 11.2515
February 15, 2012 12.6390
February 15, 2013 14.2640
February 15, 2014 10.0892
The principal of, Make-Whole Premium, if any, and interest on,
the Bonds shall be payable and the Bonds shall be exchangeable and transferable,
at the office or agency of the Issuer in the Borough of Manhattan, the City of
New York maintained for such purposes (which initially shall be the Corporate
Trust Office of the Trustee) to the Person in whose name such Bond is registered
at the close of business on the Regular Record Date applicable to each Principal
Payment Date or otherwise in accordance with Section 309.
13
22
The Bonds shall be redeemable as provided in Article Thirteen.
This Indenture will not be qualified under the Trust Indenture
Act; thus Holders of the Bonds will not be entitled to the protections provided
under the Trust Indenture Act to holders of debt securities issued under a
qualified indenture.
SECTION 302. Denominations. The Bonds shall be issuable only
in registered form without coupons and initially only in minimum denominations
of $100,000 and integral multiples of $1,000 in excess thereof; provided,
however, that initial purchases of the Bonds by purchasers who are institutional
"accredited investors" who are not QIBs shall be in minimum amounts of $250,000;
and provided, further that after initial issuance, Bonds may be issued upon
exchange or transfer in such amounts as may be necessary to evidence the entire
unpaid principal amount of any Bond surrendered or exchanged.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Bonds shall be executed on behalf of the Issuer by its President or a Vice
President, if any, and attested by its Secretary or an Assistant Secretary. The
signature of any of these officers on the Bonds may be manual or facsimile
signatures of the present or any future such authorized officer and may be
imprinted or otherwise reproduced on the Bonds.
Bonds bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Issuer shall bind
the Issuer, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Bonds or did
not hold such offices at the date of such Bonds.
At any time and from time to time after the execution and
delivery of this Indenture, the Issuer may deliver Bonds executed by the Issuer
to the Trustee for authentication, together with an Issuer Order for the
authentication and delivery of such Bonds, directing the Trustee to authenticate
the Bonds and certifying that all conditions precedent to the issuance of Bonds
contained herein have been fully complied with, and the Trustee shall, in
accordance with such Issuer Order, authenticate and deliver such Bonds. The
Trustee shall receive an Officers' Certificate and an Opinion of Counsel of the
Issuer in connection with such authentication of Bonds. Such order shall specify
the amount of Bonds to be authenticated and the date on which the original issue
of Bonds is to be authenticated.
Each Bond shall be dated the date of its authentication.
The Trustee may appoint an authenticating agent or agents
reasonably acceptable to the Issuer to authenticate Bonds. Unless limited by
terms of such appointment, an authenticating agent may authenticate Bonds
whenever the Trustee may do so. Any authenticating agent has the same rights as
an agent to deal with the Issuer or an Affiliate of the Issuer.
No Bond shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Bond a
certificate of authentication substantially in the form provided for in Exhibit
B duly executed by the Trustee by manual
14
23
signature of an authorized signatory, and such certificate upon any Bond shall
be conclusive evidence, and the only evidence, that such Bond has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Indenture.
In case the Issuer shall have executed an indenture
supplemental hereto with the Trustee pursuant to Section 1001(1), any of the
Bonds authenticated or delivered prior to the assumption of the Issuer's
obligations by any successor Person, may, from time to time, at the request of
the successor Person, be exchanged for other Bonds executed in the name of the
successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Bonds surrendered
for such exchange and of like principal amount; and the Trustee, upon Issuer
Request of the successor Person, shall authenticate and deliver Bonds as
specified in such request for the purpose of such exchange. If Bonds shall at
any time be authenticated and delivered in any new name of a successor Person
pursuant to this Section 303 in exchange or substitution for or upon
registration of transfer of any Bonds, such successor Person, at the option of
the Holders but without expense to them, shall provide for the exchange of all
Bonds at the time Outstanding for Bonds authenticated and delivered in such new
name.
SECTION 304. Temporary Bonds. Pending the preparation of
definitive Bonds, the Issuer may execute, and upon an Issuer Order, the Trustee
shall authenticate and deliver temporary Bonds which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Bonds in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Bonds may determine, as conclusively
evidenced by their execution of such Bonds.
If temporary Bonds are issued, the Issuer will cause
definitive Bonds to be prepared without unreasonable delay. After the
preparation of definitive Bonds, the temporary Bonds shall be exchangeable for
definitive Bonds upon surrender of the temporary Bonds at the office or agency
of the Issuer designated for such purpose pursuant to Section 1102, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Bonds, the Issuer shall execute, and, upon receipt of an Issuer Order
the Trustee shall authenticate and deliver, in exchange therefor a like
principal amount of definitive Bonds of authorized denominations. Until so
exchanged, the temporary Bonds shall in all respects be entitled to the same
benefits under this Indenture as definitive Bonds.
SECTION 305. Registration, Registration of Transfer and
Exchange. The Issuer shall cause to be kept at the Corporate Trust Office of the
Registrar a register which, subject to such reasonable regulations as the Issuer
may prescribe, shall provide for the registration of Bonds and for the
registration of transfers and exchanges of Bonds, and the Trustee is hereby
appointed "Registrar" for the purposes of registering Bonds and transfers and
exchanges of Bonds as herein provided. This register shall be sometimes referred
to herein as the "Security Register", and shall be in written form or any other
form capable of being converted into written form within a reasonable time. At
all reasonable times, the Security Register shall be open to inspection by the
Trustee.
15
24
Subject to the provisions of Section 307, upon surrender for
registration of transfer of any Bond at the office or agency of the Issuer
designated pursuant to Section 1102, the Issuer shall execute, and, upon receipt
of an Issuer Order, the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Bonds of any
authorized denomination or denominations of a like aggregate principal amount.
At the option of the Holder thereof, Bonds may be exchanged
for other Bonds to be registered in the name of such Holder, of authorized
denominations and of like tenor, maturity and aggregate principal amount, upon
surrender of the Bonds to be exchanged at any office or agency maintained for
such purpose. Whenever any Bonds are so surrendered for exchange, the Issuer
shall execute, and, upon receipt of an Issuer Order, the Trustee shall
authenticate and make available for delivery, the Bonds which the Holder making
the exchange is entitled to receive.
All Bonds issued upon any registration of transfer or exchange
of Bonds shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Bonds surrendered
upon such registration of transfer or exchange.
Every Bond presented or surrendered for registration of
transfer or for exchange shall (if so required by the Issuer or the Registrar)
be duly endorsed or be accompanied by a written instrument of transfer in form
satisfactory to the Issuer and the Registrar, duly executed by the Holder
thereof or his or her attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange or redemption of Bonds, but the Issuer may require payment
in certain circumstances of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Bonds, other than exchanges pursuant to Section 304,
1006 or 1307 not involving any transfer.
The Issuer shall not be required (i) to issue, register the
transfer of or exchange any Bonds during a period beginning at the opening of
business 15 days before the selection of Bonds to be redeemed under Section 1303
and ending at the close of business on the day of such mailing of the relevant
notice of redemption or (ii) to register the transfer of or exchange any Bond so
selected for redemption in whole or in part, except the unredeemed portion of
any Bond being redeemed in part.
SECTION 306. Book Entry Provisions for Global Bonds. (a) Each
Global Bond initially shall (i) be registered in the name of Cede & Co., as
nominee of DTC (such nominee being referred to herein as the "Global Bond
Holder"), (ii) be deposited with, or on behalf of, DTC or with the Trustee, as
custodian for DTC and (iii) bear legends as set forth in Section 202.
Members of, or participants in, DTC (collectively, the
"Participants" or the "DTC Participants") shall have no rights under this
Indenture with respect to any Global Bond held on their behalf by DTC, or the
Trustee as its custodian, or under any Global Bond, and DTC may be treated by
the Issuer, the Trustee and any agent of the Issuer or the Trustee as the
absolute owner of such Global Bond for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Issuer, the Trustee or any agent
of the Issuer or the Trustee from giving effect to
16
25
any written certification, proxy or other authorization furnished by DTC or
shall impair, as between DTC and its Participants, the operation of customary
practices governing the exercise of the rights of a Holder of any Bond.
(b) Transfers of any Global Bond shall be limited to transfers
of such Global Bond in whole, but not in part, to DTC, its successors or their
respective nominees. Interests of beneficial owners in a Global Bond may be
transferred in accordance with the applicable rules and procedures of DTC and
the provisions of Section 307. In addition, U.S. Physical Bonds or Regulation S
Physical Bonds shall be transferred to all beneficial owners in exchange for
their beneficial interests in the Rule 144A Global Bonds or Regulation S Global
Bonds, respectively, if: the Issuer notifies the Trustee in writing that DTC is
unwilling or unable to continue as depository for the Global Bonds or DTC ceases
to be a "Clearing Agency" registered under the Exchange Act and a successor
depository is not appointed by the Issuer within 90 days or (ii) the Issuer, at
its option, notifies the Trustee in writing that it elects to have the Physical
Bonds so issued.
(c) Any beneficial interest in one of the Global Bonds that is
transferred to a person who takes delivery in the form of an interest in the
other Global Bond will, upon transfer, cease to be an interest in such Global
Bond and become an interest in the other Global Bond and, accordingly, will
thereafter be subject to all transfer restrictions, if any, and other procedures
applicable to beneficial interests in such other Global Bond for as long as it
remains such an interest.
(d) In connection with the transfer of an entire Rule 144A
Global Bond or Regulation S Global Bond to beneficial owners pursuant to
paragraph (b) of this Section 306, the Rule 144A Global Bond or Regulation S
Global Bond, as the case may be, shall be deemed to be surrendered to the
Trustee for cancellation, and the Issuer shall execute, and the Trustee shall
authenticate and deliver, to each beneficial owner identified by DTC in exchange
for its beneficial interest in the Rule 144A Global Bond or Regulation S Global
Bond, as the case may be, an equal aggregate principal amount of Physical Bonds
of authorized denominations.
(e) Any U.S. Physical Bond delivered in exchange for an
interest in the Rule 144A Global Bond pursuant to subsection (b) of this Section
306 shall, unless such exchange is made on or after the Resale Restriction
Termination Date for such Bond, bear the Private Placement Legend.
(f) The registered Global Bond Holder may grant proxies and
otherwise authorize any person, including DTC's Participants and persons that
may hold interests through DTC's Participants, to take any action which a Holder
is entitled to take under this Indenture or the Bonds.
(g) Any beneficial owner of interests in a Global Bond may
receive Physical Bonds (which shall bear the Private Placement Legend if
required by Section 202) in accordance with the procedures of DTC. In connection
with the execution, authentication and delivery of such Physical Bonds in
exchange for beneficial interests in a Global Bond pursuant to this paragraph
(g) or paragraph (b) above, the Registrar shall reflect on its books and records
the date
17
26
and a decrease in the principal amount of the applicable Global Bond in an
amount equal to the principal amount of the beneficial interest in such Global
Bond to be transferred, and the Issuer shall execute, and the Trustee shall
authenticate and deliver one or more Physical Bonds of like tenor and having an
equal aggregate principal amount.
SECTION 307. Special Transfer Provisions. Unless and until a
Bond is sold under an effective Registration Statement, the following provisions
shall apply:
(a) Transfers to Non-QIB Institutional Accredited Investors.
The following provisions shall apply with respect to the registration
of any proposed transfer of a Bond to any institutional "accredited
investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation
D under the Securities Act) which is not a QIB (excluding Non-U.S.
Persons):
(i) The Registrar shall register the transfer of
any Bond, whether or not such Bond bears the Private Placement
Legend, if (x) the requested transfer is at least two years
after the original issue date of the Bonds or (y) the proposed
transferee has delivered to the Registrar a certificate
substantially in the form of Exhibit D.
(ii) If the proposed transferor is a DTC Participant
holding a beneficial interest in the Rule 144A Global Bond,
upon receipt by the Registrar of (x) the documents, if any,
required by paragraph (i) above and (y) instructions given in
accordance with DTC's and the Registrar's procedures therefor,
the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Rule 144A Global
Bond in an amount equal to the principal amount of the
beneficial interest in the Rule 144A Global Bond to be
transferred, and the Issuer shall execute, and the Trustee
shall authenticate and deliver, one or more Physical Bonds of
like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply
with respect to the registration of any proposed transfer of a U.S.
Physical Bond or an interest in the Rule 144A Global Bond to a QIB
(excluding Non-U.S. Persons):
(i) If the Bond to be transferred consists of (x)
U.S. Physical Bonds, the Registrar shall register the transfer
and the Issuer shall execute, and the Trustee shall
authenticate and deliver, one or more U.S. Physical Bonds if
such transfer is being made by a proposed transferor who has
checked the box provided for on the form of Bond stating, or
has otherwise advised the Issuer and the Registrar in writing,
that the sale has been made in compliance with the provisions
of Rule 144A to a transferee who has signed the certification
provided for on the form of Bond stating, or has otherwise
advised the Issuer and the Registrar in writing, that it is
purchasing the Bond for its own account or an account with
respect to which it exercises sole investment discretion and
that it, or the Person on whose behalf it is acting with
respect to any such account, is a QIB within the meaning of
Rule 144A, is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received
such information regarding the
18
27
Issuer as it has requested pursuant to Rule 144A or has
determined not to request such information and that it is
aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from
registration provided by Rule 144A or (y) an interest in a
Rule 144A Global Bond, the transfer of such interest may be
effected only through the book-entry system maintained by DTC.
(ii) If the proposed transferee is a DTC
Participant, and the Bonds to be transferred consist of U.S.
Physical Bonds, upon receipt by the Registrar of instructions
given in accordance with DTC's and the Registrar's procedures
therefor, the Registrar shall reflect on its books and records
the date and an increase in the principal amount of the Rule
144A Global Bond in an amount equal to the principal amount of
the U.S. Physical Bonds to be transferred, and the Trustee
shall cancel the U.S. Physical Bonds so transferred.
(c) Transfers of Interests in the Regulation S Global Bond or
Regulation S Physical Bonds to U.S. Persons. The following provisions
shall apply with respect to any transfer of interests in the Regulation
S Global Bond or Regulation S Physical Bonds to U.S. Persons:
(i) prior to the removal of the Private Placement
Legend for the Regulation S Global Bonds or the Regulation S
Physical Bonds pursuant to Section 202, the Registrar shall
refuse to register such transfer; and
(ii) after such removal pursuant to Section 202, the
Registrar shall register the transfer of any such Bond without
requiring any additional certification.
(d) Transfers to Non-U.S. Persons at Any Time. The following
provisions shall apply with respect to any transfer of a Bond to a
Non-U.S. Person:
(i) Prior to November 5, 2000, the Registrar shall
register any proposed transfer of a Bond to a Non-U.S. Person
upon receipt of a certificate substantially in the form of
Exhibit E from the proposed transferor and the Issuer shall
execute, and the Trustee shall authenticate and deliver, one
or more Temporary Regulation S Global Bonds or Regulation S
Physical Bonds of like tenor and amount.
(ii) On and after November 5, 2000, the Registrar
shall register any proposed transfer to any Non-U.S. Person
(1) if the Bond to be transferred is a Regulation S Physical
Bond, (2) if the Bond to be transferred is a U.S. Physical
Bond or an interest in the Rule 144A Global Bond, upon receipt
of a certificate substantially in the form of Exhibit E from
the proposed transferor and, (3) in the case of either clause
(1) or (2), the Issuer shall execute, and the Trustee shall
authenticate and deliver, one or more Physical Bonds of like
tenor and amount.
19
28
(iii) If the proposed transferor is a DTC Participant
holding a beneficial interest in the Rule 144A Global Bond,
upon receipt by the Registrar of (1) the document, if any,
required by paragraph (i) and (2) instructions in accordance
with DTC's and the Registrar's procedures therefor, the
Registrar shall reflect on its books and records the date and
a decrease in the principal amount of the Rule 144A Global
Bond in an amount equal to the principal amount of the
beneficial interest in the Rule 144A Global Bond to be
transferred and the Issuer shall execute, and the Trustee
shall authenticate and deliver, one or more Physical Bonds of
like tenor and amount.
(e) Private Placement Legend. Upon the transfer, exchange or
replacement of Bonds not bearing the Private Placement Legend, the
Registrar shall deliver Bonds that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Bonds bearing the
Private Placement Legend, the Registrar shall deliver only Bonds that
bear the Private Placement Legend unless either (i) the circumstances
contemplated by paragraph (a)(i)(x) of this Section 307 exist or (ii)
there is delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Issuer and the Registrar to the effect that neither
such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act.
(f) General. By its acceptance of any Bond bearing the Private
Placement Legend, each Holder of such a Bond acknowledges the
restrictions on transfer of such Bond set forth in this Indenture and
in the Private Placement Legend and agrees that it will transfer such
Bond only as provided in this Indenture.
The Registrar shall retain until such time as no Bonds remain
Outstanding copies of all letters, notices and other written communications
received pursuant to Section 306 or this Section 307. The Issuer shall have the
right to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.
Neither the Trustee nor the Registrar shall have an obligation
or duty to monitor, determine or inquire as to compliance with any restrictions
on transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Bond other than to require delivery of such
certificates and other documentation or evidence as are expressly required by,
and to do so if and when expressly required by the terms of, this Indenture, and
to examine the same to determine substantial compliance as to form with the
express requirements hereof.
SECTION 308. Mutilated, Destroyed, Lost and Stolen Bonds. If
any mutilated Bond is surrendered to the Trustee or the Registrar, the Issuer
shall execute, and, upon receipt of an Issuer Order, the Trustee shall
authenticate and deliver, in exchange therefor a new Bond of like tenor and
principal amount and bearing a number not contemporaneously Outstanding, or, in
case any such mutilated Bond has become or is about to become due and payable,
the Issuer in its discretion may, instead of issuing a new Bond, pay such Bond.
20
29
If there shall be delivered to the Issuer and to the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any Bond
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Issuer or the Trustee that such Bond has been acquired by a bona fide
purchaser, the Issuer shall execute and upon Issuer Order the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Bond, a
new Bond of like tenor and principal amount and bearing a number not
contemporaneously Outstanding, or, in case any such destroyed, lost or stolen
Bond has become or is about to become due and payable, the Issuer in its
discretion may, instead of issuing a new Bond, pay such Bond.
Upon the issuance of any new Bond under this Section, the
Issuer may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Bond issued pursuant to this Section 308 in lieu of
any destroyed, lost or stolen Bond, shall constitute an original additional
contractual obligation of the Issuer, whether or not the destroyed, lost or
stolen Bond shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Bond, duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Bonds.
SECTION 309. Payment on Bonds; Rights Preserved. Principal of,
Make-Whole Premium, if any, and interest on any Bond which is payable, and is
punctually paid or duly provided for, on any Principal Payment Date shall be
paid to the Person in whose name such Bond (or one or more Predecessor Bonds) is
registered at the close of business on the Regular Record Date applicable to
such Principal Payment Date at the office or agency of the Issuer in the Borough
of Manhattan, the City of New York, maintained for such purposes (which
initially shall be the Corporate Trust Office) pursuant to Section 1102 or, at
the option of the Issuer, interest may be paid by check mailed to the address of
the Person entitled thereto pursuant to Section 310 as such address appears in
the Security Register; provided, that (a) all payments with respect to the
Global Bonds and Physical Bonds the Holders of which have given wire transfer
instructions to the Trustee by the Regular Record Date shall be required to be
made by wire transfer of immediately available funds to the accounts specified
by the Holders thereof; (b) the payment of the final installment of principal
of, or interest on, each Bond shall only be made upon presentation and surrender
of such Bond at the Corporate Trust Office or such other place as may be
designated pursuant to this Indenture; and (c) upon written request from any
Holder of Outstanding Bonds in the aggregate principal amount of $1,000,000,
payments of interest on, or principal (other than the final payment of
principal) of, such Bonds shall be made by wire transfer to such Holder.
Any principal of, Make-Whole Premium, if any, or interest on
any Bond which is payable, but is not punctually paid or duly provided for, on
any Principal Payment Date shall
21
30
forthwith cease to be payable to the Holder on the Regular Record Date by virtue
of having been such Holder, and such defaulted principal or interest and (to the
extent lawful) interest on such defaulted principal or interest at the rate
borne by the Bonds plus additional interest at the rate of 1% per annum (such
defaulted interest and interest thereon herein collectively called "Defaulted
Payments") shall be paid by the Issuer as provided below:
The Issuer shall make payment of any Defaulted Payment to the
Persons in whose names the Bonds (or their respective Predecessor Bonds) are
registered at the close of business on a Special Record Date for the payment of
such Defaulted Payment, which shall be fixed in the following manner. The Issuer
shall notify the Trustee in writing of the amount of Defaulted Payment proposed
to be paid on each Bond and the date of the proposed payment and, at the same
time, the Issuer shall deposit to the Collections Account an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Payment or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be held
in trust for the benefit of the Persons entitled to such Defaulted Payment as
provided in this clause. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Payment which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not less
than 10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Issuer of such Special Record
Date and, in the name and at the expense of the Issuer, shall cause notice of
the proposed payment of such Defaulted Payment and the Special Record Date
therefor to be given in the manner provided for in Section 106, not less than 10
days prior to such Special Record Date. Notice of the proposed payment of such
Defaulted Payment and the Special Record Date therefor having been so given,
such Defaulted Payment shall be paid by the Trustee to the Persons in whose
names the Bonds (or their respective Predecessor Bonds) are registered at the
close of business on such Special Record Date.
Subject to the foregoing provisions of this Section 309, each
Bond delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Bond shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Bond.
SECTION 310. Persons Deemed Owners. Prior to the due
presentment of a Bond for registration of transfer, the Issuer, the Trustee and
any agent of the Issuer or the Trustee may treat the Person in whose name such
Bond is registered as the owner of such Bond for the purpose of receiving
payment of principal of, Make-Whole Premium, if any, and (subject to Sections
305 and 309) interest on such Bond and for all other purposes whatsoever,
whether or not such Bond be overdue, and none of the Issuer, the Trustee or any
agent of the Issuer or the Trustee shall be affected by notice to the contrary.
None of the Issuer, the Trustee and any agent of the Issuer or
the Trustee shall have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Bond in global form or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
22
31
SECTION 311. Cancellation. All Bonds surrendered for payment,
redemption, registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by it. The Issuer at any time may deliver to the Trustee (or to any
other Person for delivery to the Trustee) for cancellation any Bonds previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever and any Bonds previously authenticated hereunder which the
Issuer has not issued and sold, and all Bonds so delivered shall be promptly
canceled by the Trustee. If the Issuer shall so acquire any of the Bonds,
however, such acquisition shall not operate as a redemption or satisfaction of
the indebtedness represented by such Bonds unless and until the same are
surrendered to the Trustee for cancellation. No Bonds shall be authenticated in
lieu of or in exchange for any Bonds canceled as provided in this Section 311,
except as expressly permitted by this Indenture. All canceled Bonds held by the
Trustee shall be disposed of by the Trustee in accordance with its customary
procedures and certification of their disposal delivered to the Issuer unless by
Issuer Order the Issuer shall direct that canceled Bonds be returned to it;
provided, however, that the Trustee shall not be required to destroy such
canceled Bonds.
SECTION 312. Computation of Interest. Interest on the Bonds
shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 313. CUSIP and CINS Numbers. The Issuer in issuing
the Bonds may use "CUSIP" and "CINS" numbers (if then generally in use), and, if
so, the Trustee shall use "CUSIP" or "CINS" numbers in notices of redemption or
exchange as a convenience to Holders; provided that any such notice shall state
that no representation is made as to the correctness of such numbers either as
printed on the Bonds or as contained in any notice of a redemption or exchange,
that reliance may be placed only on the other identification numbers printed on
the Bonds and that any such redemption shall not be affected by any defect in or
omission of such numbers.
SECTION 314. Parity of Bonds. All Bonds issued and Outstanding
hereunder rank on a parity with each other Bond and each Bond shall be secured
equally and ratably by this Indenture and the Security Documents with each other
Bond, without preference, priority or distinction of any one thereof over any
other by reason of difference in time of issuance or otherwise, and each Bond
shall be entitled to the same benefits and security in this Indenture and the
Security Documents as each other Bond.
ARTICLE FOUR
APPLICATION OF PROCEEDS FROM SALE OF BONDS
SECTION 401. Application of Proceeds from Sale of Bonds. The
Issuer covenants to use the entire proceeds from the issuance and sale of the
Bonds (a) to fund the Liquidity Account in an amount equal to $13,200,500 in
accordance with Section 503; (b) to fund the Collections Account in an amount
equal to $2,396,509 in accordance with Section 502; (c) to make a payment to
Newark Bay in accordance with the Purchase Agreement in connection
23
32
with the purchase of the Original Power Purchase Agreement by the Issuer; and
(d) to pay costs, fees and expenses incurred in connection with the transactions
contemplated hereby.
ARTICLE FIVE
ACCOUNTS
SECTION 501. Establishment of Accounts. (a) The Trustee shall
establish and maintain the following non-interest bearing accounts
(collectively, the "Accounts") in the name of the Trustee for the benefit of the
Holders: (i) the Collections Account; (ii) the Liquidity Account; and (iii) the
Damages and Indemnity Account.
(b) All monies and Permitted Investments credited to the
Accounts from time to time shall constitute part of the Collateral and shall be
collateral security for the payment and performance by the Issuer of all its
obligations under the Financing Documents and, subject to the terms of the
Indenture, shall at all times be subject to the sole dominion and control of the
Trustee for the purposes and on the terms set forth in this Indenture and other
Financing Documents. Until payment and performance of all the obligations of the
Issuer under the Financing Documents in accordance with the provisions hereof,
the Issuer shall have no right to the funds credited to the Accounts, except as
provided in this Article Five. If a Notice of an Actionable Event shall have
been given and be outstanding, the Trustee shall apply all or any of the monies
in the Accounts in accordance with the express terms of the Indenture and in the
order of priority set forth in Section 711.
SECTION 502. Collections Account. (a) On or prior to the
Closing Date, the Trustee shall establish and maintain a segregated trust
account no. 30536, created and established by the Trustee in its trust capacity
in its Corporate Trust Office and entitled "Collections Account" (the
"Collections Account"). Without limitation of any other amounts required under
this Indenture to be deposited in the Collections Account (including any profit
or interest earned on the investment of moneys held in any Account pursuant to
Section 505), all Collections, all Account Transfer Payments and an amount equal
to $2,396,509 from the proceeds of the issuance and sale of the Bonds shall be
deposited with the Trustee in the Collections Account. The Issuer shall instruct
each Person from whom it receives or is entitled to receive Collections to pay
such Collections (identifying them as such in writing to the Trustee) directly
to the Trustee for deposit in the Collections Account, and the Trustee shall be
entitled to receive directly all Collections from the Persons owing the same. In
furtherance of the foregoing, the Consents have been executed and delivered
concurrently with the execution and delivery of this Indenture. In the event
that any Collections are remitted directly to, or are otherwise received by, the
Issuer, all such Collections shall be held by the Issuer as the agent of and in
trust for the Trustee, and the Issuer shall promptly remit such Collections in
the form received (with any necessary endorsement) to the Trustee for deposit in
the Collections Account.
(b) Unless a Notice of an Actionable Event shall have been
given in writing to the Trustee and be outstanding, in which case the provisions
of Section 711 shall be applicable, the Trustee shall apply amounts in the
Collections Account on the dates specified below and in
24
33
the following order of priority for payment to the appropriate Person, but in
each case only to the extent that all current and past due amounts ranking prior
thereto have been paid in full:
(i) FIRST, on the fifteenth day of each month, to pay to
the Trustee the amount of Trustee Fees due and payable at such time in
connection with the Bonds;
(ii) SECOND, on the fifteenth day of each month, to pay to
EPM, the EPM Payments for the month prior to the most recently ended
month (as specified in an Officer's Certificate of the Issuer);
(iii) THIRD, on each Interest Payment Date, to pay, on a pro
rata basis, all interest due and payable (including past due amounts)
at such time on the Bonds;
(iv) FOURTH, on each Principal Payment Date, to pay on a
pro rata basis, an amount equal to the principal and Make-Whole Premium
(if any) due and payable (including past due amounts) at such time on
the Bonds;
(v) FIFTH, on each Interest Payment Date to transfer to
the Liquidity Account an amount, if any, necessary to cause the amount
on deposit in the Liquidity Account to be equal to the then applicable
Liquidity Reserve Required Balance;
(vi) SIXTH, on each Interest Payment Date to pay to EPM an
amount equal to the fees and expenses due and payable at such time to
EPM under the Administrative Services Agreement (as specified in an
Officer's Certificate of the Issuer); and
(vii) SEVENTH, on each Principal Payment Date or on February
15, 2001 provided that (as specified in an Officer's Certificate of the
Issuer) (i) no Event of Default or Default has occurred and is
continuing on such date and (ii) the Debt Service Coverage Ratio
calculated as of such date for the most recently ended six (6) months
equals or exceeds 1.03 to 1.0, to the Issuer for distribution to its
Members.
SECTION 503. Liquidity Account. (a) On or prior to the Closing
Date, the Trustee shall establish and maintain a segregated trust account no.
30537, created and established by the Trustee in its trust capacity in its
Corporate Trust Office and entitled "Liquidity Account" (the "Liquidity
Account"). The Liquidity Account shall be funded (i) on the Closing Date with
the net proceeds from the issuance and sale of the Bonds in an amount equal to
the Liquidity Reserve Required Balance as of the Closing Date and (ii) by a
transfer of funds, if any, from the Collections Accounts to the Liquidity
Account in accordance with clause (v) of Section 502(b). At any time, and from
time to time, EPEC may deliver to the Trustee, for allocation to the Liquidity
Account in satisfaction of all or a portion of the then applicable Liquidity
Reserve Required Balance (1) one or more letters of credit (each, a "Letter of
Credit") or (2) for so long as EPEC has a Required Credit Rating with respect to
its long-term debt obligation from Standard & Poor's and Moody's, a guaranty
from EPEC in favor of the Trustee (a "Withdrawal Guaranty"), substantially in
the form of Exhibit F. Each Letter of Credit (A) shall be from a financial
institution rated at least Aa3 (or its equivalent) by Moody's and AA- (or its
equivalent) by Standard & Poor's, (B) shall name the Trustee as its sole
beneficiary, (C) shall
25
34
provide that the Trustee may unconditionally draw, upon presentation of the
documentation required by such Letter of Credit, under any circumstances that
would otherwise permit withdrawals from the Liquidity Account or at any time
within 30 days of the expiration of such Letter of Credit (unless such Letter of
Credit is replaced with another Letter of Credit that meets the requirements of
this Section 503)) and (D) shall provide that the reimbursement obligations
thereunder will not be for the account of the Issuer. Upon delivery of one or
more Letters of Credit or a Withdrawal Guaranty, as the case may be, in
satisfaction of all or a portion of the Liquidity Reserve Required Balance, the
Trustee shall, as specified in an Officer's Certificate of the Issuer, withdraw
and transfer from the Liquidity Account to EPEC (or as EPEC may otherwise direct
in writing) an amount equal to the stated amount available to be drawn under
such Letters of Credit, or the maximum amount guaranteed under the Withdrawal
Guaranty. Any reference in this Indenture to the balance of the Liquidity
Account or the amount of funds on deposit therein shall be deemed to include the
aggregate amount available to be drawn by the Trustee under all Letters of
Credit and the Withdrawal Guaranty then in the possession of the Trustee and in
full force and effect and allocated to the Liquidity Account pursuant to an
Officer's Certificate of the Issuer. Any provision of this Indenture instructing
or authorizing the transfer of funds from the Liquidity Account shall be deemed
to instruct or authorize the Trustee to draw upon any such Letters of Credit or
the Withdrawal Guaranty, and to transfer the proceeds therefrom, in the same
manner and to the same extent as the Trustee would otherwise draw on cash or
Permitted Investments on deposit in the Liquidity Account.
(b) In the event that on any Interest Payment Date or
Principal Payment Date, as applicable, the aggregate amount of funds on deposit
in and available to be withdrawn from the Collections Account shall be
insufficient for the payment of interest or principal then due and payable on
the Bonds (any such deficiency, a "Liquidity Deficiency"), the Trustee shall
forthwith transfer to the Collections Account from the Liquidity Account an
amount equal to such Liquidity Deficiency. If on any Interest Payment Date the
aggregate amount of funds on deposit in and available to be withdrawn from the
Liquidity Account shall exceed the then current Liquidity Reserve Required
Balance, any such excess funds shall be transferred on the next Principal
Payment Date (but no earlier than February 15, 2003) to the Collections Account
for application in accordance with the provisions of Section 501(a). To the
extent that any such excess is attributable to any Letter of Credit or
Withdrawal Guaranty the Trustee shall not draw upon such Letter of Credit, but
shall take such action on the next Principal Payment Date (but no earlier than
February 15, 2003) as EPEC shall reasonably direct in writing to the Trustee,
consistent with such Letter of Credit or Withdrawal Guaranty in order to reduce
the amount available to be drawn under such Letter of Credit or Withdrawal
Guaranty in an amount sufficient to eliminate such excess.
(c) If, on the third Business Day prior to any Interest
Payment Date, (i) the aggregate amounts on deposit in the Collections Account
are insufficient to pay the full amount of interest (including Additional
Interest) due on such Interest Payment Date and (ii) Additional Interest is due
on such Interest Payment Date, the Trustee shall forthwith make a demand for
payment upon EPEC in accordance with the provisions of the Funding Agreement and
shall, on such Interest Payment Date, apply the amounts received from EPEC to
pay interest on the Bonds.
26
35
SECTION 504. Damages and Indemnity Account. (a) On or prior to
the Closing Date, the Trustee shall establish and maintain a segregated trust
account no. 30538, created and established by the Trustee in its trust capacity
in its Corporate Trust Office and entitled "Damages and Indemnity Account" (the
"Damages and Indemnity Account"). The Damages and Indemnity Account shall be
funded with all amounts paid by EPM under the Power Services Agreement and all
amounts paid by EPEC under the EPEC Guaranty, in each case, with respect to (i)
all damages payable by the Issuer to PSE&G pursuant to Article XIV of the
Amended and Restated PPA; (ii) all indemnity payments payable by the Issuer to
PSE&G pursuant to Article XII of the Amended and Restated PPA; or (iii)
Distribution Surcharges (as defined in the Amended and Restated PPA) payable by
the Issuer to PSE&G pursuant to Article II(E) of the Amended and Restated PPA.
(b) The Trustee shall, from time to time, as specified in an
Officer's Certificate of the Issuer, withdraw from the Damages and Indemnity
Account and pay to PSE&G, when due (i) all damages payable by the Issuer to
PSE&G pursuant to Article XIV of the Amended and Restated PPA; (ii) all
indemnity payments payable by the Issuer to PSE&G pursuant to Article XII of the
Amended and Restated PPA and (iii) all Distribution Surcharges (as defined in
the Amended and Restated PPA) payable by the Issuer to PSE&G pursuant to Article
II(E) of the Amended and Restated PPA.
SECTION 505. Statements: Investment of Funds. On or before the
fifth (5th) Business Day of each calendar month the Trustee shall provide the
Issuer with a written statement of (i) the balances in each of the Accounts at
the end of the immediately preceding calendar month, (ii) the amounts deposited
into each of the Accounts for the immediately preceding calendar month and (iii)
the application of amounts withdrawn from each of the Accounts for the
immediately preceding calendar month. Funds on deposit in the Accounts shall be
invested by the Trustee, as specified in an Issuer Order, in Permitted
Investments. The Issuer shall deliver to the Trustee on the date hereof an
Issuer Order specifying its initial investment instructions which shall remain
in effect until changed by a subsequent Issuer Order given not less than five
(5) Business Days before the effective date of such change. All such Permitted
Investments shall be maintained in the name of the Trustee and pledged to the
Trustee to be held by it as part of the Collateral hereunder, and the Trustee
shall be authorized to endorse any of such Permitted Investments in a manner
satisfactory to it, on behalf of the Issuer. The Trustee may rely and shall be
fully protected, as provided in Section 807, in its reliance on an Issuer Order
that complies with the provisions of this Section 505, and shall be indemnified
as provided in Section 806. All earnings on Permitted Investments shall be
credited to the Collections Account upon receipt thereof by the Trustee,
provided that all earnings on Permitted Investments made with funds on deposit
in the Liquidity Account shall be retained therein to the extent necessary to
meet the Liquidity Reserve Required Balance. All losses shall be charged to the
applicable Account. Whenever the Trustee is required or permitted to make any
payment or transfer under this Indenture, the Trustee shall have the right, and
is hereby irrevocably authorized, to sell or otherwise liquidate any Permitted
Investments to the extent necessary to make such payment or transfer and shall
have no liability for and shall be fully protected from and against any losses
incurred in connection with such sale or liquidation. The Trustee shall have no
obligation to invest and reinvest any cash held in the Accounts in the absence
of timely and specific written investment direction from the Issuer. Other than
by reason of its own
27
36
negligent failure to act or its own willful misconduct, in no event shall the
Trustee be liable for the selection of investments or for investment losses
incurred thereon. Other than by reason of its own negligent failure to act or
its own willful misconduct, the Trustee shall have no liability in respect of
losses incurred as a result of the liquidation of any investment prior to its
stated maturity or the failure of the Issuer to provide timely written
investment direction.
ARTICLE SIX
SATISFACTION AND DISCHARGE
SECTION 601. Satisfaction and Discharge of Indenture. This
Indenture shall, upon receipt by the Trustee of an Issuer Request, cease to be
of further effect (except as to any surviving rights of registration of transfer
or exchange of Bonds herein expressly provided for and except as otherwise
specifically provided in this Indenture) and the Trustee, at the expense of the
Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture when
(1) either
(A) all Bonds theretofore authenticated and delivered
(other than (i) Bonds which have been destroyed, lost or
stolen and which have been replaced or paid as provided in
Section 308 and (ii) Bonds for whose payment money has
theretofore been deposited in trust with the Trustee or any
Paying Agent or segregated and held in trust by the Issuer and
thereafter repaid to the Issuer, as provided in Section 1402)
have been delivered to the Trustee for cancellation; or
(B) all Bonds not theretofore delivered to the
Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year, or
(iii) if redeemable at the option of the
Issuer, are to be called for redemption within one
year under arrangements satisfactory to the Trustee
for the giving of notice of redemption by the Trustee
in the name, and at the expense, of the Issuer,
and the Issuer, in the case of (B)(i), (ii) or (iii) above,
has irrevocably deposited or caused to be deposited with the
Trustee as trust funds in trust for the purpose an amount
sufficient to pay and discharge the entire indebtedness on
such Bonds not theretofore delivered to the Trustee for
cancellation, for principal, Make-Whole Premium, if any, and
interest to the date of such deposit (in the case of Bonds
which have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be;
28
37
(2) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer; and
(3) the Issuer has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Issuer to the Trustee or any agent of the
Trustee appointed in accordance with the provisions hereof and the Paying Agent
under Section 806 and, if money shall have been deposited with the Trustee
pursuant to subclause (B) of clause (1) of this Section, the obligations of the
Trustee under Section 801 shall survive.
SECTION 602. Application of Trust Money. All money deposited
with the Trustee pursuant to Section 601 shall be held in trust and applied by
it, in accordance with the provisions of the Bonds and this Indenture, to the
payment, either directly or through any Paying Agent (including the Issuer
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and Make-Whole Premium, if any) and interest
for whose payment such money has been deposited with the Trustee; but such money
need not be segregated from other funds except to the extent required by law.
ARTICLE SEVEN
REMEDIES
SECTION 701. Events of Default. "Event of Default," wherever
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) the Issuer shall default in the payment of any
principal of or Make-Whole Premium, if any, on any of the Bonds when
the same shall become due and payable, whether by scheduled maturity or
acceleration or otherwise, and such default shall continue for a period
of at least five (5) days; or
(ii) the Issuer shall default in the payment of interest
on, or any other amount (other than principal or Make-Whole Premium)
required to be paid with respect to, any of the Bonds in each case when
the same shall become due and payable, and such default shall continue
for a period of at least fifteen (15) days; or
(iii) the Issuer, EPEC or PSE&G shall fail to observe or
perform any covenant or provision of any Material Agreement or
Financing Document to which it is a party, and such failure (a) could
reasonably be expected to result in a Material Adverse Effect and (b)
shall continue for a period of at least thirty (30) days after the date
notice thereof shall have been given to the Issuer by the Trustee or
the Majority Holders; or
29
38
(iv) any Material Agreement or Financing Document shall
cease at any time to be valid and binding and in full force and effect
and such invalidity or unenforceability could reasonably be expected to
result in a Material Adverse Effect; or
(v) (a) any grant of a Lien contained hereunder or in any
Financing Document shall cease or otherwise fail to be effective to
grant a Lien to the Trustee on any material portion of the Collateral
described therein, or shall cease to be perfected or be a first
priority security interest, or (b) any creditor of the Issuer (other
than the Trustee or the Holders) shall assert any right or interest
with respect to the Collateral and such assertion of rights or
interests could reasonably be expected to result in a Material Adverse
Effect, or (c) the Issuer's right to receive payments with respect to
the Collateral shall otherwise be terminated or impaired and such
termination or impairment of the right to receive payments could
reasonably be expected to result in a Material Adverse Effect; or
(vi) the Issuer shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian,
trustee or liquidator of itself or of all or a substantial part of its
property, (ii) admit in writing its inability, or be generally unable,
to pay its debts as such debts become due, (iii) make a general
assignment for the benefit of its creditors, (iv) commence a voluntary
case under the Federal Bankruptcy Code, (v) file a petition seeking to
take advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts or
(vi) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against the Issuer in an
involuntary case under the Federal Bankruptcy Code; or
(vii) a proceeding or case shall be commenced without the
application or consent of the Issuer in any court of competent
jurisdiction seeking (i) its liquidation, reorganization, dissolution,
winding-up, or the composition or readjustment of debts, (ii) the
appointment of a trustee, receiver, custodian, liquidator or the like
of the Issuer under any law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or adjustment of debts, and
such proceeding or case shall continue undismissed, or any order,
judgment or decree approving or ordering any of the foregoing shall be
entered and continue unstayed and in effect for a period of sixty (60)
or more consecutive days, or any order for relief against the Issuer
shall be entered in an involuntary case under the Federal Bankruptcy
Code; or
(viii) it becomes unlawful for the Issuer to perform any of
its obligations under the Indenture, any Security Document or any Bond,
or any of its obligations hereunder or thereunder ceases to be valid,
binding and enforceable, unless such event or occurrence could not
reasonably be expected to result in a Material Adverse Effect; or
(ix) any of the Amended and Restated Power Purchase
Agreement, the EPEC Guaranty or the Funding Agreement shall at any time
(prior to its scheduled expiration) for any reason be terminated or
abrogated; or
(x) a judgment or judgments for the payment of money in
excess of $15 million in the aggregate, which is not adequately covered
by insurance or a payment or
30
39
performance bond, shall be entered against the Issuer and such judgment
or judgments have not been vacated, discharged, stayed or bonded
pending appeal within sixty (60) days from the entry thereof.
(xi) the Issuer shall fail to observe or perform any
covenant or provision of Section 3(b) of the Registration Rights
Agreement and such failure shall continue for a period of at least
thirty (30) days after the date notice thereof shall have been given to
the Issuer by the Trustee or the Majority Holders.
SECTION 702. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default (other than a Bankruptcy Event of Default)
occurs and is continuing, then and in every such case the Trustee, upon the
direction of Holders of no less than 25% of the Outstanding Bonds (for an Event
of Default specified in clauses (i) and (ii) of Section 701) or the Majority
Holders (for any other Event of Default), shall declare the principal amount of
all the Bonds to be due and payable immediately, by a notice in writing to the
Issuer (and to the Trustee, if given by the Holders), and upon any such
declaration such principal amount, any accrued and unpaid interest and all other
amounts payable under the Bonds shall become immediately due and payable.
If a Bankruptcy Event of Default occurs, the principal amount
of, any accrued interest on and all other amounts payable under the Bonds then
Outstanding shall become immediately due and payable.
In addition, if one or more of the Events of Default (other
than a Bankruptcy Event of Default) shall have occurred and be continuing, the
Trustee may accelerate the maturity of the Bonds as provided in the first
paragraph of this Section 702 notwithstanding the absence of direction from the
Holders if in the judgment of the Trustee such action is necessary to protect
the interests of the Holders.
At any time after the principal of the Bonds shall have become
due and payable upon a declared acceleration as provided herein, and before any
judgment or decree for the payment of the money so due, or any portion thereof,
shall be entered, the Majority Holders, by written notice to the Issuer and the
Trustee, may rescind and annul such declaration and its consequences if all
Events of Default giving rise to such acceleration have been cured or waived.
At any time after a declaration of acceleration under this
Indenture, but before a judgment or decree for payment of the principal amount
of the Bonds then due has been obtained by the Trustee, the Issuer by written
notice to a Responsible Officer of the Trustee, may rescind and annul such
declaration and its consequences if:
(a) the Issuer has paid or deposited with the Trustee a sum
sufficient to pay:
(i) all overdue interest on all the Bonds;
(ii) all unpaid principal of and premium, if any, on
any Outstanding Bonds that have become due otherwise than by
such declaration of acceleration and interest thereon at the
rate borne by the Bonds;
31
40
(iii) to the extent that payment of such interest is
lawful, interest upon overdue interest and overdue principal
at the rate borne by the Bonds; and
(iv) all sums paid or advanced by the Trustee under
this Indenture and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
(b) all Defaults and Events of Default, other than the
non-payment of amounts of principal of, premium, if any, or interest on
the Bonds that have become due solely by such declaration of
acceleration have been cured or waived as provided in Section 718.
No such rescission shall affect any subsequent Default or impair any
right consequent thereon.
SECTION 703. Remedies Upon an Event of Default. If any Event
of Default shall have occurred and be continuing and acceleration shall have
occurred pursuant to Section 702, the Trustee may, subject in each case to the
provisions of Section 807, exercise any or all of the rights and remedies
granted to it in any Security Document. Without limiting the generality of the
foregoing, the Issuer expressly agrees that in any such event the Trustee,
without demand of performance or any other demand, advertisement or notice of
any kind (except the notice specified below of the time and place of public or
private sale) to or upon the Issuer or any other Person (all and each of which
demands, advertisements and/or notices are hereby expressly waived to the extent
permitted by applicable law), may, and at the written instruction of the
Majority Holders shall, subject to the provisions of the Material Agreements and
to the provisions of any other law or regulation having the force of law: (i)
collect, receive and appropriate any or all of the Collateral and exercise any
right, remedy, power or privilege of the Issuer under any Material Agreement;
(ii) set off against all amounts due and payable hereunder in the Accounts,
(iii) proceed by suit at law or in equity to seek specific performance of any
obligation of the Issuer; (iv) take possession of the Collateral forthwith or
any time thereafter, in which case the Issuer shall marshal and deliver the
Collateral to the Trustee or its designee at such time or times and such place
or places as the Trustee may reasonably specify; (v) subject to the provisions
of Section 704, forthwith sell, lease, assign, give an option or options to
purchase or otherwise dispose of and deliver all or any part of the Collateral
(or contract to do so) at one or more public or private sales, at any exchange,
broker's board or at any of the Trustee's offices or elsewhere at such prices as
it may deem best, for cash or on credit or for future delivery without
assumption of any credit risk; (vi) institute legal proceedings for the
appointment of a receiver with respect to any or all of the Collateral or with
respect to the Issuer; or (vii) proceed by suit at law or in equity to foreclose
upon the Collateral or exercise any other right or remedy available under
applicable law. The Trustee may sell any or all of the Collateral as provided
above at any private or public sale, it being hereby agreed that twenty (20)
Business Days' notice by the Trustee to the Issuer shall be deemed to be
reasonable notice of any such sale. The Issuer hereby waives, to the extent
permitted by applicable law, any claims against the Trustee arising by reason of
the fact that the price at which Collateral may have been sold at any such
private sale was less than the price which might have been obtained at a public
sale.
32
41
SECTION 704. Certain Sales of Collateral. In connection with
the exercise of any remedies under Section 703(v) the Trustee will not sell the
Collateral or any portion thereof without the written consent of all of the
Holders of the Bonds Outstanding unless the proceeds of such sale will be
sufficient to satisfy all of the outstanding principal amount, accrued and
unpaid interest, any Make-Whole Premium and all other amounts due and payable
under the Bonds.
SECTION 705. No Marshaling. To the extent that it lawfully
may, the Issuer hereby agrees that it will not at any time plead, claim or take
the benefit of any appraisement, valuation, stay, extension, moratorium or
redemption law now or hereafter in force and any requirement of marshaling in
the event of foreclosure of the security interests hereby created, the effect of
which might be to prevent or delay the enforcement of any Security Document or
the absolute sale of the whole or any part of the Collateral or the possession
thereof by the Trustee or any purchaser at any sale by the Trustee. The Issuer,
for itself and all who may claim under the Issuer, as far as the Issuer may
lawfully do so, hereby waives and releases the benefit of all such laws. Except
as otherwise expressly provided in this Indenture, to the extent permitted by
applicable law, the Issuer hereby waives presentment, demand, protest or any
notice of any kind in connection with, and not expressly set forth in, any
Security Document or herein.
SECTION 706. Trustee May Recover Unpaid Indebtedness after
Sale of Collateral. Subject to Section 114, in the case of a sale of the
Collateral and of the application of the proceeds of such sale to the payment of
the indebtedness secured by this Indenture, the Trustee in its own name, and as
trustee of an express trust, shall be entitled and empowered, by any appropriate
means, legal, equitable or otherwise to enforce payment of, and to receive all
amounts then remaining due and unpaid upon, all or any of the Bonds, for the
benefit of the Holders thereof, and upon any other portion of the indebtedness
remaining unpaid, with interest at the rates specified in the respective Bonds
on the overdue principal of and Make-Whole Premium, if any, and (to the extent
that payment of such interest is legally enforceable) on the overdue
installments of interest.
SECTION 707. Recovery of Judgment Does Not Affect Rights. No
recovery of any such judgment or final decree by the Trustee and no levy of any
execution under any such judgment upon any of the Collateral, or upon any other
property, shall in any manner or to any extent affect any rights, powers or
remedies of the Trustee, or any liens, rights, powers or remedies of the
Holders, but all such liens, rights, powers or remedies shall continue
unimpaired as before.
SECTION 708. Collection of Indebtedness and Suits for
Enforcement by Trustee. The Issuer covenants that if:
(a) default is made in the payment of any installment of
interest on any Bond when such interest becomes due and payable and
such default continues for a period of 30 days, or
(b) default is made in the payment of the principal of or
premium, if any, on any Bond when such becomes due and payable, or on
any Mandatory Redemption Date,
33
42
the Issuer will, upon demand of the Trustee, pay to the Trustee for the benefit
of the Holders of such Bonds, the whole amount then due and payable on such
Bonds for principal, premium, if any, and interest, and interest on any overdue
principal, premium, if any, and, to the extent that payment of such interest
shall be legally enforceable, upon any overdue installment of interest and
overdue principal, at the rate borne by the Bonds, and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If the Issuer fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name as trustee of an express trust, at the
direction of the Holders as set forth herein may institute a judicial proceeding
for the collection of the sums so due and unpaid, may prosecute such proceeding
to judgment or final decree and may enforce the same against the Issuer or any
other obligor upon the Bonds and collect the moneys adjudged or decreed to be
payable in the manner provided by law out of the property of the Issuer or any
other obligor upon the Bonds, wherever situated.
If an Event of Default with respect to the Bonds occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Bonds by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any
such rights, whether for the specific enforcement of any covenant or agreement
in this Indenture or in aid of the exercise of any power granted herein, or to
enforce any other proper remedy.
SECTION 709. Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Issuer or any other obligor upon the Bonds or the
Property of the Issuer or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal of the Bonds shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Issuer for the payment of
overdue principal, Make-Whole Premium, if any, or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of
principal (and Make-Whole Premium, if any) and interest owing and
unpaid in respect of the Bonds and to file such other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel) and of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to
34
43
the Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 806.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Bonds or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 710. Trustee May Enforce Claims Without Possession of
Bonds. All rights of action and claims under this Indenture or the Bonds may be
prosecuted and enforced by the Trustee without the possession of any of the
Bonds or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the Holders.
SECTION 711. Application of Money Collected. Any money
collected by the Trustee pursuant to this Article shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal (or Make-Whole Premium, if
any) or interest, upon presentation of the Bonds and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
First, to the payment of all amounts due to the Trustee and
each predecessor Trustee, if any, under Section 806;
Second, to the payment of the amounts when due and unpaid for
principal of (and Make-Whole Premium, if any) and any interest on the
Bonds in respect of which or for the benefit of which such money has
been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Bonds for principal
(and Make-Whole Premium, if any) and any interest, respectively;
Third, to the payment of all amounts due and payable to EPM
under the Power Services Agreement and the Administrative Services
Agreement, as the case may be, as set forth in an Officer's Certificate
or as determined by a court of competent jurisdiction; and
Fourth, to the Issuer.
SECTION 712. Limitation on Suits. No Holder of any Bond shall
have any right to institute any proceeding, judicial or otherwise, with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
35
44
(2) the Majority Holders shall have made written request to
the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory to the Trustee against the costs,
expenses and liabilities to be incurred in compliance with such
request;
(4) the Trustee for sixty (60) days after its receipt of such
notice, request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Majority
Holders;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Bonds, or to obtain or to seek to obtain priority or preference over
any other of such Holders or to enforce any right under this Indenture, except
in the manner herein provided and for the equal and ratable benefit of all
Holders of Bonds.
SECTION 713. Unconditional Right of Holders to Receive
Principal, Make-Whole Premium and Interest. Notwithstanding any other provision
in this Indenture, the Holder of any Bond shall have the right, which is
absolute and unconditional, to receive payment, as provided herein (including,
if applicable, Article Fourteen), of the principal of (and Make-Whole Premium,
if any, on) and (subject to Section 309) interest on, such Bond on the
respective Stated Maturities expressed in such Bond (or, in the case of
redemption, on the Redemption Date), including any interest accrued on any grace
period provided in Section 701, and to institute suit for the enforcement of any
such payment, and such rights shall not be impaired without the consent of such
Holder.
SECTION 714. Restoration of Rights and Remedies. If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Issuer, the Trustee and the Holders of Bonds shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 715. Rights and Remedies Cumulative. Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Bonds in the last paragraph of Section 308, no right
or remedy herein conferred upon or reserved to the Trustee or to the Holders of
Bonds is intended to be exclusive of any other right or remedy, and every right
and remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
36
45
SECTION 716. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Bond to exercise any right or
remedy accruing upon any Event of Default shall impair any such right or remedy
or constitute a waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 717. Control by Holders. The Majority Holders shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee, provided that such Majority Holders have provided the
Trustee with indemnity acceptable to the Trustee against the costs, expenses
(including reasonable attorneys' fees and expenses) and liabilities to be
incurred in following such direction and that direction shall not in conflict
with any law and the provisions of this Indenture and provided, further, that
(subject to the provisions of Section 801) the Trustee shall have the right to
decline to follow any such direction if such directions are unclear or
inconsistent with any other directives given to the Trustee or if the Trustee,
being advised by counsel, shall determine that the action or proceeding so
directed may not lawfully be taken or if the Trustee in good faith by a
Responsible Officer of the Trustee shall determine that the action or
proceedings so directed would involve the Trustee in personal liability or if
the Trustee in good faith shall so determine that the actions or forbearances
specified in or pursuant to such direction would be unduly prejudicial to the
interests of Holders so affected not joining in the giving of said direction, it
being understood that (subject to Section 801) the Trustee shall have no duty to
ascertain whether or not such actions or forbearances are unduly prejudicial to
such Holders.
Nothing in this Indenture shall impair the right of the
Trustee in its discretion to take any action deemed proper by the Trustee and
which is not inconsistent with such direction or directions by the Majority
Holders.
SECTION 718. Waiver of Past Defaults. The Majority Holders may
on behalf of the Holders of all the Bonds waive any past default, except a
default in the payment of the principal of (or Make-Whole Premium, if any) or
any interest on any Bond or in respect of a covenant or provision hereof that
cannot be modified or amended without the unanimous affirmative vote of all
Holders.
Upon any such waiver, any such default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured,
for every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
SECTION 719. Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law and covenants
that the Issuer will not
37
46
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
SECTION 720. Trustee to Give Notice of Default, But May
Withhold in Certain Circumstances. Within forty-five (45) days after a
Responsible Officer assigned to the Corporate Trust Office of the Trustee
obtains actual knowledge of the occurrence of any Default hereunder, the Trustee
shall transmit by mail to all Holders as their names shall appear on the
Security Register, in the manner and to the extent provided in Trust Indenture
Act Section 313(c), notice of such Default hereunder, unless such Default shall
have been cured or waived; provided, however, that, except in the case of a
default in the payment of the principal of, Make-Whole Premium, if any, or
interest on any Bond, the Trustee shall be protected in withholding such notice
if and so long as the board of directors, the executive committee or a trust
committee of directors or Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the interest of the Holders.
SECTION 721. Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay the
costs of such suit, and may assess costs (including reasonable attorneys' fees
and expenses) against any such party litigant, in the manner and to the extent
provided in the Trust Indenture Act; provided, that the provisions of this
Section shall not apply to any suit instituted by the Trustee, or the Issuer to
any suit instituted by any Holder or group of Holders, holding in the aggregate
more than 10% in principal amount of the Outstanding Bonds, or any suit
instituted by any Holder for the enforcement of the payment of the principal of
(or Make-Whole Premium, if any) or interest, if any, on any Bond on or after the
respective due dates expressed in such Bond (or, in the case of redemption, on
or after the Redemption Date).
ARTICLE EIGHT
THE TRUSTEE
SECTION 801. Duties and Responsibilities of the Trustee;
During Default; Prior to Default. (a) The Trustee, prior to the occurrence of an
Event of Default and after the curing or waiving of all Events of Default which
may have occurred, shall undertake to perform such duties and only such duties
as are specifically set forth in this Indenture. In case an Event of Default has
occurred (which has not been cured or waived) the Trustee shall exercise such of
the rights and powers vested in it by this Indenture and use the same degree of
care and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(b) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except that:
(i) during the continuance of an Event of Default:
38
47
(A) the duties and obligations of the Trustee shall
be determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically
set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the
Trustee; and
(B) in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any statements, certificates or opinions
furnished to the Trustee and conforming to the requirements of
this Indenture; but in the case of any such statements,
certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein);
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be conclusively determined by
a court of competent jurisdiction that the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders pursuant to Section 712 relating to
the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture.
(c) None of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if there shall be reasonable ground for
believing that the repayment of such funds or indemnity satisfactory to it
against such liability is not assured to it.
SECTION 802. Certain Rights of Trustee. Subject to the
provisions of Section 801:
(a) the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting in reliance upon any
resolution, Officer's Certificate or any other certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(b) any request, direction, order or demand of the Issuer
mentioned herein shall be sufficiently evidenced by an Issuer Request
or Issuer Order (unless other evidence in respect thereof be herein
specifically prescribed); and any Management
39
48
Committee's Consent may be sufficiently evidenced to the Trustee by a
copy thereof certified by the Secretary or a Member of the Issuer;
(c) the Trustee may consult with counsel of its selection and
any advice of counsel or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder or under any Security Document in good faith
and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture or under any
Security Document at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have offered to
the Trustee security or indemnity reasonably satisfactory to the
Trustee against the costs, expenses and liabilities which might be
incurred therein or thereby;
(e) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, appraisal, bond, debenture, notice, security, or other
paper or document unless requested in writing so to do by the Majority
Holders; provided that, if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by
it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded
to it by the terms of this Indenture, the Trustee may require indemnity
satisfactory to it against such expenses or liabilities as a condition
to proceeding; the reasonable expenses of every such investigation
shall be paid by the Issuer or, if paid by the Trustee, any predecessor
trustee or the Holders of any Outstanding Bonds, shall be repaid by the
Issuer upon demand;
(f) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder or under any Security
Document either directly or by or through agents or attorneys not
regularly in its employ and the Trustee shall not be responsible for
any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder;
(g) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Indenture;
(i) except during the continuance of an Event of Default, the
Trustee need perform only those duties as are specifically set forth in
this Indenture;
(j) the Trustee is hereby authorized and directed to enter
into the Security Documents;
(k) the Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee
has actual knowledge thereof or unless written notice of any event
which is in fact such a default is received by the
40
49
Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Bonds and this Indenture; and
(l) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right
to be indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and to each agent,
custodian and other Person employed to act hereunder and under the
Security Documents.
SECTION 803. Trustee Not Responsible for Recitals or Issuance
of Bonds. Other than as specifically provided in the Trustee recitals of this
Indenture, the recitals contained herein and in the Bonds, except for the
Trustee's certificates of authentication, shall be taken as the statements of
the Issuer, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of any disclosure document or offering materials or of the Bonds.
Neither the Trustee nor its agents appointed in accordance with the provisions
hereof shall be accountable for the use or application by the Issuer of the
Bonds or the proceeds thereof.
SECTION 804. May Hold Bonds. The Trustee, any Paying Agent,
the Registrar or any other agent of the Issuer or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee of Bonds and,
subject to Trust Indenture Act Sections 310(b) and 311, may otherwise deal with
the Issuer with the same rights it would have if it were not the Trustee, any
Paying Agent, the Registrar or any other agent of the Issuer or such agent and,
subject to Sections 809 and 813, if operative, may otherwise deal with the
Issuer and receive, collect, hold and retain collections from the Issuer with
the same rights it would have if it were not the Trustee, any Paying Agent, the
Registrar or any other agent of the Issuer.
SECTION 805. Money Held In Trust. All moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. Neither the Trustee nor any agent of
the Issuer shall be under any liability for interest on any moneys received by
it hereunder except as otherwise agreed with the Issuer.
SECTION 806. Compensation and Indemnification of Trustee,
Paying Agent and Registrar and Its Prior Claim. (a) The Issuer covenants and
agrees to pay to the Trustee and to each Paying Agent and Registrar, and the
Trustee and each Paying Agent and Registrar shall be entitled to, such
compensation as set forth in any fee agreement between the Issuer and the
Trustee entered into in connection with the execution and delivery of this
Indenture by the parties hereto or in connection with the issuance of the Bonds
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) and the Issuer covenants and
agrees to pay or reimburse the Trustee and each Paying Agent and Registrar and
their respective predecessors upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of it in accordance
with any of the provisions of this Indenture (including the reasonable
compensation and the reasonable expenses and disbursements of its counsel and of
all agents and other persons not regularly in its employ) except any such
expenses, disbursement or advance as may arise from its negligence or bad faith.
As security for such payment and for all of the other obligations of the Issuer
set forth in this
41
50
Section 806 (and any fees referred to in Section 816), the Trustee shall have a
security interest and Lien prior to the Bonds upon all Collateral. The
provisions of this Section 806 shall survive the resignation or removal of the
Trustee and the termination of the other provisions of this Indenture.
(b) The Issuer also covenants to indemnify the Trustee and
each Paying Agent and Registrar and their respective predecessors, officers,
directors, employees, representatives and agents for, and to hold it harmless
against, any and all loss, liability, damage, claim or expense, including taxes
(other than taxes based on the income of the Trustee and each Paying Agent, and
Registrar and their respective predecessors, officers, directors, employees,
representatives and agents) incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance, administration or
enforcement of this Indenture and under the other Financing Documents or the
trusts hereunder and its duties hereunder and the other Financing Documents,
including any liability which the Trustee or Paying Agent may incur as a result
of failure to withhold, pay or report any tax, assessment or other governmental
charge and the costs and expenses of defending itself against or investigating
any claim of liability in the promises. The obligations of the Issuer under this
Section to compensate and indemnify the Trustee and each Paying Agent and
Registrar and their respective predecessors and to pay or reimburse the Trustee
and each Paying Agent and Registrar and their respective predecessors for
expenses, disbursements and advances shall constitute additional indebtedness
hereunder and shall survive the termination, satisfaction and discharge of this
Indenture. References herein to the "Trustee" shall be deemed to also refer to
the Trustee acting in its capacity as Paying Agent or in any other capacity as
contemplated herein or in any Financing Document.
Where the Trustee incurs expenses or renders services in
connection with a Bankruptcy Event of Default, such expenses (including
reasonable attorneys' fees and expenses) and the compensation for the services
are intended to constitute expenses of administration under applicable federal
or state bankruptcy, insolvency or other law.
SECTION 807. Right of Trustee to Rely on Officer's
Certificate, Etc. Subject to Sections 801 and 802, whenever in the
administration of the trusts of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
suffering or omitting any action hereunder, such matter (unless other evidence
in respect thereof be herein specifically prescribed) may, in the absence of bad
faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officer's Certificate delivered to the Trustee, and such
certificate, in the absence of bad faith on the part of the Trustee, shall be
full warranty to the Trustee for any action taken, suffered or omitted by it
under the provisions of this Indenture upon the faith thereof.
SECTION 808. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall be eligible to act as
Trustee under Trust Indenture Act Section 310(a)(1) and (2) and which shall have
a combined capital and surplus of at least one fifty million ($50,000,000). If
such corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of federal, state, territorial or District of
Columbia supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set
42
51
forth in its most recent report of condition so published. The Trustee shall
comply with the provisions of the Trust Indenture Act Section 310(b). If at any
time the Trustee shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 809. Qualification of Trustee; Conflicting Interests.
If the Trustee has or shall acquire any conflicting interest within the meaning
of the Trust Indenture Act, the Trustee shall, upon the occurrence of an Event
of Default, either eliminate such conflicting interest or resign, to the extent
and in the manner provided by, and subject to the provisions of, the Trust
Indenture Act and this Indenture.
SECTION 810. Resignation and Removal; Appointment of Successor
Trustee. (a) The Trustee may at any time resign by giving written notice of
resignation to the Issuer and by mailing written notice thereof by first-class
mail, postage prepaid, to all Holders at their last addresses as they shall
appear on the Security Register specifying the day upon which the resignation is
to take effect, and such resignation will take effect immediately upon the later
of the appointment of a successor trustee pursuant to this Article Eight and
such specified day. Upon receiving such notice of resignation, the Issuer shall
promptly appoint a successor trustee by written instrument in duplicate,
executed by authority of the Members of the Issuer, one copy of which instrument
shall be delivered to the resigning Trustee and one copy to the successor
trustee or trustees. If no successor trustee shall have been so appointed and
have accepted appointment within thirty (30) days after the mailing of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Holder who has
been a bona fide Holder of a Bond or Bonds for at least six months may, on
behalf of himself and all others similarly situated, petition any such court for
the appointment of a successor trustee. Such court may thereupon, after such
notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provision of
Section 809 and TIA Section 310(b) after written request therefor by
the Issuer or by any Holder who has been a bona fide Holder for at
least six (6) months, except when the Trustee's duty to resign is
stayed in accordance with the provisions of Trust Indenture Act Section
310(b); or
(ii) the Trustee shall cease to be eligible in accordance
with the provisions of Section 808 and shall fail to resign after
written request therefor by the Issuer or by any Holder who has been a
bona fide Holder for at least six (6) months; or
(iii) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation;
then, in any such case, the Issuer may, by Management Committee's consent,
remove the Trustee and appoint a successor trustee by written instrument, in
duplicate, executed by order of the
43
52
Members, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or, subject to the provisions of
Section 811, unless the Trustee's duty to resign is stayed as provided herein,
any Holder who has been a bona fide Holder for at least six (6) months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor trustee.
(c) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Issuer, by a Management Committee's Consent, shall promptly
appoint a successor trustee. If, within one year after such resignation, removal
or incapability, or the occurrence of such vacancy, a successor trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Bonds delivered to the Issuer and the retiring Trustee, the
successor trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor trustee and to that extent supersede the
successor trustee appointed by the Issuer. If no successor trustee shall have
been so appointed by the Issuer or the Holders and accepted appointment in the
manner hereinafter provided, any Holder who has been a bona fide Holder for at
least six (6) months may, behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
trustee.
(d) It is the purpose of this Indenture that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact business as an indenture
trustee in such jurisdiction.
(e) The Issuer shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor trustee in the manner
provided for in Section 106. Each notice shall include the name of the successor
trustee and the address of its Corporate Trust Office.
(f) The Holders by Act of a majority in aggregate principal
amount of Outstanding Bonds may at any time remove the Trustee and appoint a
successor trustee by delivering to the Trustee so removed, to the successor
trustee so appointed and to the Issuer the evidence provided for in Section 104
of the action in that regard taken by the Holders.
(g) No resignation or removal of the Trustee and no
appointment of a successor trustee pursuant to any of the provisions of this
Section 810 shall become effective until the acceptance of appointment by the
successor trustee as provided in Section 811.
SECTION 811. Acceptance of Appointment by Successor. (a) In
case of the appointment hereunder of a successor trustee, every such successor
trustee so appointed shall execute, acknowledge and deliver to the Issuer and to
the retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Issuer or the successor trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor trustee all the rights,
44
53
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor trustee all property and money held by such retiring
Trustee hereunder.
(b) Upon request of any such successor trustee, the Issuer
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all rights, powers and trusts referred
to in paragraph (a) of this Section.
(c) No successor trustee shall accept its appointment unless
at the time of such acceptance such successor trustee shall be qualified and
eligible under this Article.
SECTION 812. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder;
provided, that such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Bonds shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Bonds so authenticated with the same effect
as if such successor trustee had itself authenticated such Bonds; and in case at
that time any of the Bonds shall not have been authenticated, any successor
trustee may authenticate such Bonds either in the name of any predecessor
hereunder or in the name of the successor trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Bonds or in
this Indenture provided that the certificate of the Trustee shall have;
provided, however, that the right to adopt the certificate of authentication of
any predecessor Trustee or to authenticate Bonds in the name of any predecessor
trustee shall apply only to its successor or successors by merger, conversion or
consolidation.
SECTION 813. Preferential Collection of Claims Against Issuer.
If and when the Trustee shall be or become a creditor of the Issuer (or any
other obligor under the Bonds), the Trustee shall be subject to the provisions
of the Trust Indenture Act regarding the collection of claims against the Issuer
(or any such other obligor), excluding any creditor relationships described in
Trust Indenture Act Section 311(b). A Trustee who has resigned or has been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent
indicated therein.
SECTION 814. No Liability for Clean-up of Hazardous Materials.
In the event that the Trustee is required to acquire title to an asset for any
reason, or take any managerial action of any kind in regard thereto, in order to
carry out any fiduciary or trust obligation for the benefit of another, which in
the Trustee's sole discretion may cause the Trustee to be considered an "owner
or operator" under the provisions of the Comprehensive Environmental Response,
Compensation and Liability Act (CERCLA), 42 U.S.C. Sections 9601, et seq., or
otherwise cause the Trustee to incur liability under CERCLA or any other
federal, state or local law, the Trustee reserves the right to, instead of
taking such action, either resign as Trustee or arrange for the transfer of the
title or control of the asset to a court appointed receiver.
45
54
The Trustee shall not be liable to the Issuer or Holders or
any other person for any environmental claims or contribution actions under any
federal, state or local law, rule or regulation by reason of the Trustee's
actions and conduct as authorized, empowered and directed hereunder or relating
to the discharge, release or threatened release of hazardous materials into the
environment, except to the extent of the Trustee's negligence or willful
misconduct.
SECTION 815. Registrar and Paying Agents. Insofar as such
provisions may be applicable, the Registrar, the Authenticating Agent, Paying
Agent and any other Agent appointed in accordance with the provisions hereof
shall enjoy the same protections, immunities and indemnities as are provided for
in this Article Eight with respect to the Trustee.
SECTION 816. Filing Fees. The Issuer agrees to pay or to
reimburse the Trustee for any and all amounts in respect of all filing,
recording and registration fees which may be payable or determined to be payable
in respect of the execution, delivery, performance and enforcement of the
Financing Documents and agrees to save the Trustee harmless from and against any
and all liabilities with respect to or resulting from any delay in paying or
omitting to pay such fees. The obligations of the Issuer under this Section 816
shall survive the resignation or removal of the Trustee and the termination of
the other provisions of this Indenture.
SECTION 817. Fee Agreement. The Fee Agreement provides for the
compensation of the Trustee hereunder for its services as such, and the Trustee
will not look to the holders of the Bonds for any payment for such services,
provided that this Section 817 shall not alter the application provision of
Section 502(b) or the lien provided in Section 806(a).
ARTICLE NINE
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND ISSUER
SECTION 901. Holder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of the Holders. If the Trustee is not the Security
Registrar, the Issuer shall furnish to the Trustee at least five (5) Business
Days before each Payment Date, and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders. The Trustee may
conclusively rely upon such list provided by the Issuer until otherwise notified
by the Issuer or such list is amended by the Issuer.
SECTION 902. Disclosure of Names and Addresses of Holders.
Every Holder of Bonds, by receiving and holding the same, agrees with the Issuer
and the Trustee that none of the Issuer or the Trustee or any agent of either of
them shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in accordance with
Trust Indenture Act Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under TIA Section
312(b).
46
55
SECTION 903. Reports by Trustee. (a) Within sixty (60) days
after May 15 of each year commencing with the first May 15 after the first
issuance of Bonds pursuant to this Indenture, the Trustee shall transmit to the
Holders of Bonds, in the manner and to the extent provided in TIA Section
313(c), a brief report dated as of such May 15 if required by TIA Section
313(a).
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Bonds are listed, with the Commission and with the Issuer. The Issuer
shall promptly notify the Trustee when any Bonds are listed on any stock
exchange.
SECTION 904. Reports by Issuer. The Issuer shall:
(1) file with the Trustee, within fifteen (15) days after the
Issuer is required to file the same with the Commission, copies of the
annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the Commission may
from time to time by rules and regulations prescribe) which the Issuer
may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act; or, if the Issuer is not
required to file information, documents or reports pursuant to either
of such Sections, then it shall file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
Section 13 of the Securities Exchange Act in respect of a security
listed and registered on a national securities exchange as may be
prescribed from time to time in such rules and regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with
respect to compliance by the Issuer with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
(3) transmit to all Holders, in the manner and to the extent
provided in TIA Section 313(c), within thirty (30) days after the
filing thereof with the Trustee, such summaries of any information,
documents and reports required to be filed by the Issuer pursuant to
paragraphs (1) and (2) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission.
Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Issuer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officer's Certificates).
47
56
ARTICLE TEN
SUPPLEMENTS AND AMENDMENTS TO INDENTURE AND SECURITY DOCUMENTS
SECTION 1001. Without Vote of Holders. Without the vote or
approval of any Holders, the Issuer, when authorized by or pursuant to a
Management Committee's Consent, and the Trustee, at any time and from time to
time, may amend or supplement this Indenture, any Security Documents or the
Bonds, in form satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Issuer
and the assumption by any such successor of the covenants of the Issuer
contained herein and in the Bonds; or
(2) to add to the covenants of the Issuer for the benefit of
the Holders or to surrender any right or power herein conferred upon
the Issuer; or
(3) to add any additional Events of Default; or
(4) to secure the Bonds; or
(5) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee and to add to or change any of the
provisions hereof as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one trustee; or
(6) to cure any ambiguity, to correct or supplement any
provision hereof which may be inconsistent with any other provision in
this Indenture, or to make any other provisions with respect to matters
or questions arising under this Indenture; provided, that, such action
shall not adversely affect the interests of the Holders in any material
respect; or
(7) to supplement any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the
defeasance and discharge of the Bonds; provided, that, any such action
does not adversely affect the interests of the Holders in any material
respect.
SECTION 1002. With Consent of Holders. With the consent of the
Majority Holders, by Act of said Holders delivered to the Issuer and the
Trustee, the Issuer, when authorized by or pursuant to a Management Committee's
Consent, and the Trustee may amend or supplement this Indenture or the Bonds for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or the Bonds or of modifying in any
manner the rights of the Holders under this Indenture; provided, however, that
no such amendment or supplement shall, without the consent of the Holder of each
Outstanding Bond,
48
57
(i) change the Stated Maturity of the principal of,
or any installment of interest on, any Bond;
(ii) reduce the principal amount or interest on or
any Make-Whole Premium payable upon the redemption of any Bond
including discharge of repayment of principal of or interest on any
Bond;
(iii) reduce the percentage in principal amount of
Outstanding Bonds, the consent of the Holders of which is required for
the adoption of a resolution or the quorum required at any meeting of
Holders at which a resolution is adopted or the percentage in principal
amount of Outstanding Bonds the Holders of which are entitled to
request the calling of a Holder's meeting;
(iv) change the percentage rules established for
adopting resolutions at meetings of Holders or regarding the quorum
necessary to constitute a meeting;
(v) modify any of the provisions of this Section and
Section 718, except to increase any such percentage;
(vi) change the place or coin or currency for payment
of principal of, or Make-Whole Premium or interest on, any Bond;
(vii) impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof
or any Redemption Date or Payment Date therefor;
(viii) permit the creation of any Lien with respect
to all or any substantial portion of the Collateral, or release or
terminate the Lien of the Security Documents on all or any substantial
portion of the Collateral or deprive any Holder of the security
afforded by the Lien of the Security Documents, except to the extent
expressly permitted by this Indenture or any of the Security Documents;
(ix) modify the ranking or priority of the Bonds; or
(x) waive a default in the payment of principal of,
Make-Whole Premium, if any, or interest on, the Bonds.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 1003. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any amended or
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and shall be fully protected in relying upon, an Opinion of Counsel stating that
the execution of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
49
58
SECTION 1004. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture or
the applicable Security Document shall be modified in accordance therewith, and
such supplemental indenture, amendment, modification or waiver shall form a part
of this Indenture or the applicable Security Document (as the case may be) for
all purposes; and every Holder of Bonds theretofore or thereafter authenticated
and delivered hereunder shall be bound thereby.
SECTION 1005. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
SECTION 1006. Reference in Bonds to Supplemental Indentures.
Bonds authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in
such supplemental indenture. If the Issuer shall so determine, new Bonds so
modified as to conform, in the opinion of the Trustee and the Issuer, to any
such supplemental indenture may be prepared and executed by the Issuer, and,
upon receipt of an Issuer Order, authenticated and delivered by the Trustee, in
exchange for Outstanding Bonds. Failure to make the appropriate notation or to
issue a new Bond shall not affect the validity of such supplemental indenture,
amendment, modification or waiver.
SECTION 1007. Notice of Supplemental Indentures. Promptly
after the execution by the Issuer and the Trustee of any supplemental indenture,
amendment, modification or waiver pursuant to the provisions of Section 1002,
the Issuer shall give notice thereof to the Holders, in the manner provided for
in Section 106, setting forth in general terms the substance of such
supplemental indenture, amendment, modification or waiver.
ARTICLE ELEVEN
AFFIRMATIVE COVENANTS
SECTION 1101. Payment of Principal and Interest. The Issuer
shall duly and punctually pay the principal of, interest on, if any, and
Make-Whole Premium, if any, on the Bonds in accordance with the terms of the
Bonds and this Indenture.
SECTION 1102. Maintenance of Office or Agency. The Issuer will
maintain in the Borough of Manhattan, the City of New York, and in each Place of
Payment, an office or agency where Bonds may be presented or surrendered for
payment, where Bonds may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Issuer in respect of the Bonds and
this Indenture may be served.
The Issuer will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Issuer shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate
50
59
Trust Office of the Trustee and the Issuer hereby appoints the same as its agent
to receive such respective presentations, surrenders, notices and demands.
The Issuer may also from time to time designate one or more
other offices or agencies where Bonds may be presented or surrendered for any or
all such purposes and may from time to time rescind any such designation;
provided, however, that no such designation or rescission shall in any manner
relieve the Issuer of its obligation to maintain an office or agency in
accordance with the requirements set forth above for such purposes. The Issuer
will give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
SECTION 1103. Maintenance of Existence, Properties. (a) The
Issuer shall preserve and maintain its legal existence and form and all
registrations necessary therefor.
(b) The Issuer shall preserve and maintain all of its
licenses, rights, privileges and franchises necessary for the conduct of its
business and the performance of its obligations under the Material Agreements
and the Financing Documents, except to the extent failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 1104. Payments of Taxes and Other Claims. The Issuer
shall pay and discharge or cause to be paid and discharged, before the same
shall become delinquent, all taxes, assessments and governmental charges levied
or imposed upon the Issuer, and all lawful claims or obligations which, if
unpaid, might by law become a Lien upon the Property of the Issuer; provided,
however, that the Issuer will not be required to pay or discharge or cause to be
paid or discharged any such tax, assessment, charge or claims whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings and for which adequate funds have been set aside.
SECTION 1105. Material Agreements. The Issuer will enforce all
of its rights, powers and remedies under each of the Material Agreements, unless
the failure to enforce such rights, powers and remedies could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 1106. Notice of Certain Events. The Issuer shall
furnish to the Trustee:
(a) within 120 days after the end of each fiscal year of the
Issuer ending after the date hereof, an Officer's Certificate of a
Responsible Officer stating that (x) no Default has occurred and is
continuing (or if any such Default has occurred and is continuing,
describing such Default in reasonable detail and describing the steps
being taken to remedy such Default) and (y) the Issuer is in compliance
with all conditions and covenants under this Indenture, the Bonds and
the other Financing Documents to which it is a party; and
(b) each of the following items promptly after the Issuer
learns of the occurrence or existence thereof:
51
60
(i) written notice of the occurrence of any
event or condition which constitutes a Default or an Event of
Default, stating that such event or condition has occurred and
describing it and any action being or proposed to be taken
with respect thereto;
(ii) any actually proposed amendment,
termination, rescission, discharge (other than by performance)
or waiver under or with respect to any Financing Document or
Material Agreement;
(iii) written notice of any Force Majeure
Event under the Amended and Restated Power Purchase Agreement;
(iv) any written notice requiring the Issuer
to make any indemnity payments under any Material Agreement;
(v) written notice of any material
litigation filed against it; and
(vi) written notice of any change which
could be reasonably expected to result in a Material Adverse
Effect.
With respect to the information and documents required to be
delivered to the Trustee pursuant to clauses (a) and (b) of this Section 1106,
the Issuer hereby further covenants and agrees to deliver or cause to be
delivered any such documents and information (i) to each Holder who makes a
request in writing to the Issuer and (ii) to any beneficial holder who makes a
request in writing to the Issuer (which request may indicate that it is a
continuing request for such information until further notice from a Holder or
such owner of a beneficial interest in a Global Bond to the contrary) for such
documents or information. Delivery of such reports, information and documents to
the Trustee is for information purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Issuer's
compliance with any of its covenants hereunder.
SECTION 1107. Compliance with Laws and Other Agreements. The
Issuer shall comply with (a) all applicable laws, rules, regulations, orders and
directions of any Governmental Agency having jurisdiction over it or its
business and (b) all of its covenants and obligations contained in any agreement
to which the Issuer is a party, unless, in each case, the failure to so comply
could not reasonably be expected to result in a Material Adverse Effect.
SECTION 1108. Maintenance of Books and Records. The Issuer
shall at all times maintain proper books, accounts and records in accordance
with GAAP. The Issuer shall permit the Trustee, upon reasonable notice and
during normal business hours, to visit its premises and inspect all books,
accounts and records of the Issuer.
SECTION 1109. Approvals. The Issuer will maintain in full
force and effect and comply in all respects with the conditions and obligations
under all applicable Governmental Approvals which it has obtained or which may
from time to time become necessary in connection with any of (a) the execution,
delivery and performance in accordance with their
52
61
respective terms of the Material Agreements or the Financing Documents to which
it is a party, and (b) the taking of any action contemplated hereby or thereby,
in each case except to the extent that failure to do so could not reasonably be
expected to result in a Material Adverse Effect. Without limiting the generality
of the foregoing, the Issuer will make all required filings as a public utility
under the FPA on or prior to the time such filings are required to be made and
shall take all actions, if required, necessary to maintain its FERC market-based
rate authority.
SECTION 1110. Rule 144A Information for the Holders. At any
time when the Issuer is not subject to Section 13 or 15(d) of the Securities
Exchange Act, upon the request of a Holder, the Issuer shall promptly furnish to
such Holder or to a prospective purchaser who is a qualified institutional buyer
of such Bond designated by such Holder, as the case may be, information
specified in Rule 144A(d) (4) under the Securities Act ("Rule 144A Information")
in order to permit compliance by such Holder with Rule 144A in connection with
the resale of such Bond by such Holder; provided, however, that the Issuer shall
not be required to furnish Rule 144A Information in connection with any request
made on or after the date which is two (2) years from the later of (a) the date
such Bond (or any Predecessor Bond) was acquired from the Issuer or (b) the date
such Bond (or any Predecessor Bond) was last acquired from an "affiliate" of the
Issuer within the meaning of Rule 144 under the Securities Act; and provided,
further, that the Issuer shall not be required to furnish such information at
any time to a prospective purchaser located outside the United States who is not
a "United States Person" within the meaning of Regulation S under the Securities
Act if such Bond may then be sold to such prospective purchaser in accordance
with Rule 904 under the Securities Act (or any successor provision thereto).
SECTION 1111. Recording. The Issuer shall cause, at its own
expense, this Indenture and each of the Security Documents, and all amendments
or supplements thereto, to be registered, recorded and filed or re-recorded,
re-filed and renewed in such manner and in such place or places, if any, as may
be required by law in order fully to preserve and protect the security interests
created under the Security Documents and to effectuate and preserve the security
therein granted to the Trustee hereunder for the benefit of the Holders.
Without prejudice to the above, the Issuer will comply with
all applicable provisions of the Trust Indenture Act, including, without
limitation, Trust Indenture Act Sections 314(b) and (d).
SECTION 1112. Further Assurances. The Issuer shall, at its own
cost and expense, execute and deliver, and cause to be executed and delivered,
to the Trustee all such documents, instruments and agreements, and do all such
other acts and things as may be reasonably required to preserve the Liens in
favor of the Trustee with the required first-ranking priority and to enable the
Trustee to exercise and enforce its rights under this Indenture, the Security
Documents and the other documents, instruments and agreements required under
this Indenture and to carry out the intent of this Indenture and the other
Financing Documents.
SECTION 1113. Opinions as to Collateral. The Issuer shall take
all actions necessary to maintain and preserve the perfection and priority of
all Liens in favor of the Trustee on the Collateral, and shall from time to time
execute or cause to be executed and filed any and
53
62
all further instruments (including financing statements required by the Uniform
Commercial Code, continuation statements and similar statements with respect to
the Liens in favor of the Trustee created by the Financing Documents) as are
necessary to maintain and preserve such Liens, or which the Trustee may
reasonably request.
SECTION 1114. Performance of Obligations. The Issuer may
contract with other Persons to assist it in performing its duties under this
Indenture and the other Financing Documents, and any performance of such duties
by a Person identified to the Trustee in an Officer's Certificate of the Issuer
shall be deemed to be action taken by the Issuer. As of the Closing Date, the
Issuer has contracted with EPM to assist the Issuer in performing its duties
under this Indenture and the other Financing Documents and any action taken by
EPM on behalf of the Issuer to assist it in performing its duties under this
Indenture and the other Financing Documents shall be deemed to be action taken
by the Issuer.
SECTION 1115. Money for Bond Payments to be Held in Trust.
The Issuer may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, pay to the Trustee all
sums held in trust by the Issuer, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Issuer.
Any money deposited with the Trustee, or then held by the
Issuer, in trust for the payment of the principal of, Make-Whole Premium, if
any, or interest on, any Bond and remaining unclaimed for two (2) years after
such principal, Make-Whole Premium, if any, or interest, has become due and
payable shall be paid to the Issuer on Issuer Request, or (if then held by the
Issuer) shall be discharged from such trust; and the Holder of such Bond shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof and all liability of the Trustee with respect to such trust
money, and all liability of the Issuer as trustee thereof, shall thereupon
cease.
SECTION 1116. Schedule and Delivery of Energy under the
Amended and Restated Power Purchase Agreement. The Issuer shall schedule and
deliver (a) the full amount of annual energy deliveries set forth on Exhibit 1
to the Amended and Restated Power Purchase Agreement in the year set forth
therein, and (b) the minimum on-peak energy deliveries set forth in Article V(C)
of the Amended and Restated Power Purchase Agreement in accordance with the
terms thereof.
ARTICLE TWELVE
NEGATIVE COVENANTS
SECTION 1201. Liens. The Issuer shall not create, incur,
assume or permit to exist any Lien upon any of the Collateral, other than the
Liens created by this Indenture and the Security Documents, unless the failure
to so comply could not reasonably be expected to result in a Material Adverse
Effect.
54
63
SECTION 1202. Indebtedness. The Issuer shall not create,
assume, incur or otherwise become or remain obligated in respect of, or permit
to remain outstanding, any Indebtedness, except for Indebtedness created at the
Closing Date under this Indenture.
SECTION 1203. Guaranties. The Issuer shall not at any time be
or become obligated, contingently or otherwise, with respect to any Guaranty.
SECTION 1204. Transactions With Affiliates. The Issuer shall
not effect any transaction with any of its Affiliates on a basis more favorable
to such Affiliate than would at the time be obtainable for a comparable
transaction on an arm's-length dealing with an unrelated third party, except for
(a) the Material Agreements entered into on or before the Closing Date; or (b)
in connection with any restructuring of the assets of Mesquite.
SECTION 1205. Investments, Loans and Advances. The Issuer
shall not purchase, hold or acquire any capital stock, evidences of Indebtedness
or other securities of, make or permit to exist any loans or advances to or make
or permit to exist any investment or other interest in, any other Person, except
Permitted Investments.
SECTION 1206. Material Agreements; Additional Contracts. (a)
The Issuer shall not assign any of its rights or obligations under any Material
Agreement nor will the Issuer amend in any respect or terminate or suffer any
such amendment or termination of, or grant any waiver of material and timely
performance with respect to, or agree to the assignment of the rights or
obligations of any party to, any Material Agreement; provided, that (i) the
Issuer may make amendments to the Material Agreements which are of a routine,
ministerial or administrative nature to the extent that what is contemplated
under any such amendment is not otherwise expressly prohibited hereunder or
could reasonably be expected to result in a Material Adverse Effect and (ii) any
amendment or modification to any Material Agreement which extends or modifies
the time for payment due thereunder shall not be deemed to be an amendment of a
routine, ministerial or administrative nature.
(b) The Issuer shall not become a party to any contract,
lease, agreement or instrument other than the agreements expressly identified in
the definition of Material Agreements or Financing Documents to the extent such
action could reasonably be expected to result in a Material Adverse Effect.
SECTION 1207. Fundamental Change. The Issuer shall not (a)
sell, lease, transfer or otherwise dispose of any of its right, title or
interest in or to the Collateral, unless the failure to so comply could not
reasonably be expected to result in a Material Adverse Effect; (b) conduct any
business or own any assets other than the business and assets conducted and
owned by it as of the Closing Date; (c) directly or indirectly merge or
consolidate with any other person, liquidate, wind up, terminate, reorganize or
dissolve itself, or otherwise wind up; (d) change its legal form; or (e)
establish any subsidiary.
SECTION 1208. Restricted Payments. Except as permitted in
accordance with the conditions set forth in clause (vii) of Section 502, the
Issuer shall not, directly or indirectly, (a) make any distribution (by
reduction of capital or otherwise), whether in cash, property,
55
64
securities or a combination thereof, to its Members or any owner of a beneficial
interest in the Issuer or otherwise with respect to any ownership or equity
interest or security in or of the Issuer, (b) redeem, purchase, retire or
otherwise acquire for value any such ownership or equity interest or security or
(c) set aside or otherwise segregate any amounts for any such purpose. The
Issuer will not, directly or indirectly, make payments to or distributions from
the Collections Account except in accordance with this Indenture and the
Financing Documents.
ARTICLE THIRTEEN
REDEMPTION OF BONDS
SECTION 1301. Applicability of Article. Bonds shall be
redeemable (in whole or in part) before their Stated Maturity in accordance with
the terms of such Bonds and in accordance with this Article.
SECTION 1302. Election to Redeem; Notice to Trustee. The
Issuer may, at any time and from time to time, elect to redeem any Bonds, such
election to be evidenced by or pursuant to a Management Committee's Consent. In
case of any redemption at the election of the Issuer, the Issuer shall, at least
sixty (60) days prior to the Redemption Date fixed by the Issuer (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the principal amount of Bonds to be redeemed and shall
deliver to the Trustee such documentation and records as shall enable the
Trustee to select the Bonds to be redeemed pursuant to Section 1303.
SECTION 1303. Selection by Trustee of Bonds to Be Redeemed. If
less than all the Bonds are to be redeemed, the particular Bonds to be redeemed
shall be selected not more than sixty (60) days prior to the Redemption Date by
the Trustee, from the Outstanding Bonds not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of portions of the principal of Bonds;
provided, that no such partial redemption shall reduce the portion of the
principal amount of a Bond not redeemed to less than the minimum authorized
denomination for Bonds established pursuant to Section 302.
The Trustee shall promptly notify the Issuer in writing of the
Bonds selected for redemption and, in the case of any Bonds selected for partial
redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Bonds shall
relate, in the case of any Bond redeemed or to be redeemed only in part, to the
portion of the principal amount of such Bond which has been or is to be
redeemed.
SECTION 1304. Notice of Redemption. Notice of redemption shall
be given in the manner provided for in Section 106 not less than thirty (30) nor
more than sixty (60) days prior to the Redemption Date, to each Holder of Bonds
to be redeemed, but failure to give such
56
65
notice in the manner herein provided to the Holder of any Bond designated for
redemption in whole or in part, or any defect in the notice of any such Holder,
shall not affect the validity of the proceedings for the redemption of any other
Bond or portion thereof.
Any notice that is mailed to the Holders in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the Holder receives the notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Bonds are to be redeemed,
the identification (and, in the case of partial redemption, the
principal amounts) of the particular Bonds to be redeemed,
(4) that on the Redemption Date the Redemption Price (together
with accrued interest, if any, to the Redemption Date payable as
provided in Section 1306) will become due and payable upon each Bond,
or the portion thereof, to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the Place of Payment where such Bonds, maturing after the
Redemption Date, are to be surrendered for payment of the Redemption
Price,
notice of redemption of Bonds to be redeemed at the election of the Issuer shall
be given by the Issuer or, at the Issuer's request made not less than fifteen
(15) days prior to the latest date such notice of redemption may be given, by
the Trustee in the name and at the expense of the Issuer.
SECTION 1305. Deposit of Redemption Price. Not later than one
Business Day before any Redemption Date, the Issuer shall deposit with the
Trustee or with a Paying Agent an amount of money sufficient to pay the
Redemption Price of, and accrued interest on, all the Bonds which are to be
redeemed on that date.
SECTION 1306. Bonds Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Bonds so to be redeemed shall, on
the Redemption Date, become due and payable at the Redemption Price thereof
(together with accrued interest, if any, to the Redemption Date), and from and
after such Redemption Date (unless the Issuer shall default in the payment of
the Redemption Price and accrued interest) such Bonds shall cease to bear
interest. Upon surrender of any such Bond for redemption in accordance with said
notice, maturing after the Redemption Date, such Bond shall be paid by the
Issuer at the Redemption Price, together with accrued interest, if any, to the
Redemption Date; provided that installments of interest on Bonds whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Bonds, or one or more Predecessor Bonds, registered as such at the close
of business on the relevant Regular Record Dates according to their terms and
the provisions of Section 310.
57
66
If any Bond called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and Make-Whole Premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate of
interest set forth in the Bond.
SECTION 1307. Bonds Redeemed in Part. Any Bond which is to be
redeemed only in part (pursuant to the provisions of this Article or of Article
Fourteen) shall be surrendered at a Place of Payment therefor (with, if the
Issuer or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Issuer and the Trustee duly executed by,
the Holder thereof or such Holder's attorney duly authorized in writing), and
the Issuer shall execute, and, upon Issuer Order, the Trustee shall authenticate
and deliver to the Holder of such Bond without service charge, a new Bond or
Bonds, of any authorized denomination as requested by such Holder, in aggregate
principal amount equal to and in exchange for the unredeemed portion of the
principal of the Bond so surrendered.
ARTICLE FOURTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1401. Issuer's Option to Effect Defeasance or Covenant
Defeasance. The provisions of this Article Fourteen shall apply to the Bonds,
and the Issuer may, at its option by a Management Committee's Consent, effect
defeasance of the Bonds under Section 1402, or covenant defeasance under Section
1403 in accordance with this Article.
SECTION 1402. Defeasance and Discharge. Upon the Issuer's
exercise of the above option applicable to this Section, the Issuer shall be
deemed to have been discharged from its obligations with respect to the
Outstanding Bonds on the date the conditions set forth in Section 1404 are
satisfied (hereinafter, "defeasance"). For this purpose, such defeasance means
that the Issuer shall be deemed to have paid and discharged the entire
indebtedness represented by the Outstanding Bonds, which shall thereafter be
deemed to be "Outstanding" only for the purposes of Section 1405 and the other
Sections of this Indenture referred to in (A) and (B) below, and to have
satisfied all its other obligations under such Bonds and this Indenture insofar
as such Bonds are concerned (and the Trustee, at the expense of the Issuer,
shall execute proper instruments acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of such Outstanding Bonds to receive,
solely from the trust fund described in Section 1404 and as more fully set forth
in such Section, payments in respect of the principal of and interest and
Make-Whole Premium on such Bonds when such payments are due, (B) the Issuer's
obligations with respect to such Bonds under Sections 305, 306, 307, 308, and
1102, (C) the rights, powers, trusts, duties and immunities of the Trustee
hereunder, and (D) this Article Fourteen. Subject to compliance with this
Article Fourteen, the Issuer may exercise its option under this Section 1402
notwithstanding the prior exercise of its option under Section 1403.
SECTION 1403. Covenant Defeasance. Upon the Issuer's exercise
of the above option applicable to this Section, (i) the Issuer shall be released
from its obligations under Sections 1104 through 1115, inclusive, and Sections
1201 through 1208, inclusive and (ii) the
58
67
occurrence of any event specified in Section 701(iii) (with respect to any of
Sections 1104 through 1115, inclusive, and Sections 1201 through 1208,
inclusive) shall not be deemed to be an Event of Default on or after the date
the conditions set forth in Section 1404 are satisfied (hereinafter, "covenant
defeasance"). For this purpose, such covenant defeasance means that the Issuer
may omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such Section or clause, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
Section or clause or by reason of reference in any such Section or clause to any
other provision herein or in any other document, the remainder of this Indenture
and such Bonds shall be unaffected thereby.
SECTION 1404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Section 1402 or
Section 1403:
(1) The Issuer shall irrevocably have deposited or caused to
be deposited with the Trustee (or another trustee satisfying the
requirements of Section 808 who shall agree to comply with the
provisions of this Article Fourteen applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders, an amount sufficient, in the opinion of a internationally
recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or other
qualifying trustee) to pay and discharge, (i) the principal of and
installment of interest on the Outstanding Bonds on the Stated Maturity
(or Redemption Date, if applicable) of such principal (and Make-Whole
Premium, if any) or installment of interest and (ii) any mandatory
sinking fund payments or analogous payments applicable to the
Outstanding Bonds on the day on which such payments are due and payable
in accordance with the terms of this Indenture and of the Bonds.
(2) In the case of an election under Section 1402, the Issuer
shall have delivered to the Trustee an Opinion of Counsel stating that
(x) the Issuer has received from, or there has been published by, the
Internal Revenue Service a ruling, or (y) since the date of execution
of this Indenture, there has been a change in the applicable United
States federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the Holders of
Outstanding Bonds will not recognize income, gain or loss for federal
income tax purposes as a result of such defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such defeasance had not
occurred.
(3) In the case of an election under Section 1403, the Issuer
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of Outstanding Bonds will not recognize income, gain
or loss for United States federal income tax purposes as a result of
such covenant defeasance and will be subject to United States federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred.
59
68
(4) The Issuer shall have delivered to the Trustee an
Officer's Certificate to the effect that the Bonds, if then listed on
any securities exchange, will not be delisted as a result of such
deposit.
(5) No Default or Event of Default with respect to the Bonds
shall have occurred and be continuing on the date of such deposit or,
insofar as Bankruptcy Events of Default are concerned, at any time
during the period ending on the 121st day after the date of such
deposit (it being understood that this condition shall not be deemed
satisfied until the expiration of such period).
(6) Such defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest as defined in Section 809 and
for purposes of the Trust Indenture Act with respect to any securities
of the Issuer.
(7) Such defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a default under, this Indenture
or any other material agreement or instrument to which the Issuer is a
party or by which it is bound.
(8) The Issuer shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance
under Section 1402 or the covenant defeasance under Section 1403 (as
the case may be) have been complied with, and that such defeasance or
covenant defeasance shall not result in the trust arising from such
deposit constituting an investment Issuer as defined in the Investment
Company Act of 1940, as amended, or such trust shall be qualified under
such act or exempt from regulation thereunder.
SECTION 1405. Deposited Money to Be Held in Trust; Other
Miscellaneous Provisions. All money (or other property as may be provided
hereunder) (including the proceeds thereof) deposited with the Trustee or other
qualifying trustee (collectively for purposes of this Section 1405, the
"Trustee") pursuant to Section 1404 in respect of Outstanding Bonds shall be
held in trust and applied by the Trustee, in accordance with the provisions of
the Bonds and this Indenture, to the payment, either directly or through any
Paying Agent (including the Issuer acting as its own Paying Agent) as the
Trustee may determine, to the Holders of all sums due and to become due thereon
in respect of principal (and Make-Whole Premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law.
Anything in this Article Fourteen to the contrary
notwithstanding, the Trustee shall deliver or pay to the Issuer from time to
time upon Issuer Request any money (or other property and any proceeds
therefrom) held by it as provided in Section 1404 which, in the opinion of a
internationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent defeasance or covenant defeasance, as applicable, in accordance with
this Article.
SECTION 1406. Reinstatement. If the Trustee or any Paying
Agent is unable to apply any money in accordance with Section 1405 by reason of
any order or judgment of any
60
69
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Issuer's obligations under this Indenture and the
Bonds shall be revived and reinstated as though no deposit had occurred pursuant
to Section 1402 or 1403, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with Section
1405; provided, however, that if the Issuer makes any payment of principal of
(or Make-Whole Premium, if any, on) or interest on any Bond following the
reinstatement of its obligations, the Issuer shall be subrogated to the rights
of the Holders of such Bond to receive such payment from the money held by the
Trustee or Paying Agent.
ARTICLE FIFTEEN
MEETINGS OF HOLDERS OF BONDS
SECTION 1501. Purposes for Which Holders' Meetings May Be
Called. A meeting of Holders may be called at any time and from time to time
pursuant to this Article Fifteen for any of the following purposes:
(a) to give any notice to the Issuer or to the Trustee, or to
give any directions to the Trustee, or to waive or to consent to the
waiving of any default hereunder and its consequences, or to take any
other action authorized to be taken by Holders pursuant to Article
Seven;
(b) to remove the Trustee pursuant to Article Eight;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to Section 1002; or
(d) to take any other action authorized to be taken by or on
behalf of the Holders of any specified aggregate principal amount of
the Bonds under any other provision of this Indenture or under
applicable law.
SECTION 1502. Call of Meetings by Trustee. The Trustee may at
any time call a meeting of Holders to be held at such time and at such place in
The Borough of Manhattan, the City of New York, for any purpose specified in
Section 1501 as the Trustee at the time shall determine. Notice of every meeting
of Holders, setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meetings shall be given by the
Trustee, in the manner provided in Section 106, not less than twenty (20) nor
more than one hundred and twenty (120) days prior to the date fixed for the
meeting, to the Holders.
SECTION 1503. Issuer and Holders May Call Meeting. In case the
Issuer, pursuant to a Management Committee's Consent, or the Holders of at least
ten (l0%) percent in aggregate principal amount of the Bonds then outstanding,
shall have requested the Trustee to call a meeting of Holders, by written
request setting forth in general terms the action proposed to be taken at the
meeting, and the Trustee shall not have made the mailing of the notice of such
meeting within twenty (20) days after receipt of such request, then the Issuer
or the Holders in the amount above specified may determine the time and the
place in the Borough of Manhattan, The
61
70
City of New York, for such meeting and may call such meeting to take any action
authorized in Section 1501 by giving notice thereof as provided in Section 1502.
SECTION 1504. Persons Entitled to Vote at Meeting. To be
entitled to vote at any meeting of Holders a person shall be (a) a Holder of one
or more Bonds or (b) a person appointed by an instrument in writing as proxy for
a Holder. The only persons who shall be entitled to be present or to speak at
any meeting of Holders shall be the persons entitled to vote at such meeting and
their counsel and any representatives of the Trustee and its counsel and any
representatives of the Issuer and their respective counsel.
SECTION 1505. Determination of Voting Rights: Conduct and
Adjournment of Meeting. (a) Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Holders, in regard to proof of the holding of Bonds
and of the appointment of proxies, and in regard to the appointment and duties
of inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit. Such regulations may provide that
written instruments appointing proxies, regular on their face, may be presumed
valid and genuine without the proof specified in Section 104 or other proof.
Except as otherwise permitted or required by any such regulations, the holding
of Bonds shall be proved in the manner specified in Section 104 and the
appointment of any proxy shall be proved in the manner specified in said Section
104 or by having the signature of the person executing the proxy witnessed or
guaranteed by any bank, banker, trust company or firm satisfactory to the
Trustee.
(b) The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Issuer or by Holders as provided in Section 1503, in which case the Issuer
or the Holders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by vote of the Holders of a majority in principal
amount of the Bonds represented at the meeting and entitled to vote.
(c) At any meeting, each Holder of a Bond or a proxy shall be
entitled to one vote for each $1,000 principal amount of Bonds held or
represented by it. The chairman of the meeting shall have no right to vote other
than by virtue of Bonds held by him or instruments in writing as aforesaid duly
designating him as the person to vote on behalf of other Holders. Any meeting of
Holders duly called pursuant to Section 1502 or 1503 may be adjourned from time
to time to a place, date and time announced at such meeting, and the meeting may
be held as so adjourned without further notice.
(d) At any meeting duly called pursuant to this Article 15,
the presence of persons holding or representing Bonds in an aggregate principal
amount sufficient to take action upon the business for the transaction of which
such meeting was called shall be necessary to constitute a quorum; but, if less
than a quorum be present, the persons holding or representing a majority of the
Bonds represented at the meeting may adjourn such meeting with the same effect,
for all intents and purposes, as though a quorum had been present.
62
71
SECTION 1506. Counting Votes and Recording Action of Meeting.
The vote upon any resolution submitted to any meeting of Holders shall be by
written ballots on which shall be subscribed the signatures of the Holders or of
their representatives by proxy and the serial numbers and principal amounts of
the Bonds held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Holders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 1502. The record shall
show the serial numbers of the Bonds voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Issuer and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
[signatures appear on next page]
63
72
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.
CEDAR BRAKES I, L.L.C.
By: /s/ Thomas G. Kilgore
---------------------------------------
Name: Thomas G. Kilgore
Title: Attorney in Fact
BANKERS TRUST COMPANY
Trustee, Paying Agent and Registrar
By: /s/ Richard L. Buckwalter
---------------------------------------
Name: Richard L. Buckwalter
Title: Vice President
64
73
EXHIBIT A
EXHIBIT A DEFINITIONS
"Accounts Control Agreement" means the Account Control
Agreement dated as of September 26, 2000 among the Issuer, the Trustee and
Bankers Trust Company, as the Securities Intermediary.
"Account Transfer Payment" means the amounts that are to be
transferred from the Liquidity Account to the Collections Account pursuant to
Section 503(b) of the Indenture.
"Accountant" means a Person engaged in the practice of
accounting who (except when this Indenture provides that an Accountant must be
Independent) may be employed by or affiliated with the Issuer or an Affiliate of
the Issuer.
"Accounts" has the meaning specified in Section 501 of the
Indenture.
"Act" when used with respect to any Holder, has the meaning
specified in Section 104 of the Indenture.
"Additional Interest" has the meaning specified in Section 301
of the Indenture.
"Administrative Services Agreement" means the Administrative
Services Agreement, dated as of September 20, 2000, between EPM and the Issuer.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Amended and Restated Power Purchase Agreement" means the
Amended and Restated Power Purchase Agreement, dated as of March 21, 2000,
between PSE&G and the Issuer.
"Article IV(B) Payments" has the meaning specified in the
Power Services Agreement.
"Article V(E) Capacity Payments" has the meaning specified in
the Power Services Agreement.
"Article V(E) Energy Payments" has the meaning specified in
the Power Services Agreement.
74
"Bankruptcy Event of Default" means the events described in
clause (vi) or (vii) of Section 701 of the Indenture.
"Bonds" has the meaning ascribed thereto in the Preamble of
this Indenture and shall more particularly mean Bonds authenticated and
delivered under this Indenture; individually a "Bond".
"BPU" means the New Jersey Bureau of Public Utilities and any
successor entity.
"Business Day" means, each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in the same
jurisdiction as the Corporate Trust Office of the Trustee or of any relevant
Place of Payment or other relevant location are authorized or obligated by law
or executive order to close.
"Capacity" has the meaning ascribed thereto under the Power
Services Agreement.
"Clearstream Luxembourg" means Clearstream Bank, Societe
anonyme.
"Closing Date" means September 26, 2000.
"Collateral" has the meaning specified in the Granting Clause
of this Indenture.
"Collections" means (a) all amounts payable to the Issuer from
PSE&G pursuant to the Amended and Restated Power Purchase Agreement; (b) all
amounts payable by EPM pursuant to Article V(F) of the Power Services Agreement
with respect to Energy Shortfall Liquidated Damages; (c) all amounts payable by
EPM pursuant to Article V(E) of the Power Services Agreement with respect to
Article V(E) Capacity Payments and Article V(E) Energy Payments; (d) all amounts
payable by EPM pursuant to Article IV(B) of the Power Services Agreements with
respect to Article IV(B) Payments; (e) all amounts payable by EPEC pursuant to
the EPEC Guaranty with respect to Energy Shortfall Liquidated Damages, Article
IV(B) Payments, Article (V)(E) Capacity Payments and Article V(E) Energy
Payments; (f) all amounts payable by EPEC pursuant to the Funding Agreement with
respect to Additional Interest; and (g) all earnings on Permitted Investments
made with funds in any Account.
"Collections Account" has the meaning set forth in Section 502
of the Indenture.
"Commission" means the U.S. Securities and Exchange
Commission, as from time to time constituted, created under the Securities
Exchange Act, or, if at any time after the execution of this Indenture such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
"Consent" means, individually, the EPM Consent, the PSE&G
Consent and the EPEC Consent; collectively, the "Consents."
"Corporate Trust Office" means the corporate trust office of
the Trustee, at which, at any particular time, its corporate trust business
shall be principally administered, which office on the date of execution of this
Indenture is located at 4 Albany Street, New York, New York
2
75
10006, except that with respect to presentation of Bonds for payment or for
registration of transfer or exchange, such term shall mean the office or agency
of the Trustee at which, at any particular time, its corporate agency business
shall be conducted.
"Damages and Indemnity Account" shall have the meaning set
forth in Section 504 of the Indenture.
"Debt Service Reserve Coverage Ratio" means, for any period,
the quotient of (a) Net Collections for such period over (b) Mandatory Debt
Service for such period.
"Default" means any condition or event that, with the giving
of notice or lapse of time or both, would become an Event of Default.
"Delivery Point" has the meaning specified in the Amended and
Restated Power Purchase Agreement.
"Dollar" or "$" means a dollar or other equivalent unit in
such coin or currency of the United States of America as at the time shall be
legal tender for the payment of public and private debts.
"DTC" means The Depository Trust Company, its nominees and
successors.
"DTC Participants" or "Participants" has the meaning set forth
in Section 306 of the Indenture.
"Energy" has the meaning ascribed thereto in the Power
Services Agreement.
"Energy Shortfall Liquidated Damages" has the meaning ascribed
thereto in the Power Services Agreement.
"EPEC" means El Paso Energy Corporation, a corporation
organized and existing under the laws of the State of Delaware.
"EPEC Consent" means the Consent and Agreement dated as of
September 26, 2000 among EPEC, the Issuer and the Trustee.
"EPEC Guaranty" means the Guaranty dated as of September 20,
2000 by EPEC in favor of the Issuer with respect to EPM's obligations under the
Power Services Agreement and the Administrative Services Agreement.
"EPM" means El Paso Merchant Energy, L.P., a limited
partnership organized and existing under the laws of the State of Delaware.
"EPM Consent" means the Consent and Agreement, dated as of
September 26, 2000, among EPM, the Issuer and the Trustee.
3
76
"EPM Payments" for any month, means the amount payable to EPM
by the Issuer pursuant to the Power Services Agreement for Energy and Capacity
provided to the Issuer by EPM in such month.
"Euroclear" means the accounts of purchasers at the Euroclear
System.
"Event of Default" has the meaning specified in Section 701 of
the Indenture.
"Exchange Offer" means an offer to exchange the Bonds for
other securities that complies with the requirements of the Registration Rights
Agreement.
"Federal Bankruptcy Code" means Title XI of the United States
Code or any other Federal Bankruptcy Code hereafter in effect.
"Fee Agreement" means the Letter Agreement, dated as of August
28, 2000 between the Issuer and the Trustee.
"FERC" means the Federal Energy Regulatory Commission.
"Financing Document" means, individually, the Indenture, each
Security Document, each Bond, the Fee Agreement, any and all purchase
agreements, registration rights agreements, filings and such other instruments
evidencing, securing or relating in any way to the Collateral or any Financing
Document, as shall from time to time be executed and delivered to the Trustee by
or on behalf of the Issuer or any other Person pursuant to or as contemplated by
the Indenture; collectively, the "Financing Documents."
"Force Majeure Event" shall have the meaning set forth in the
Amended and Restated Power Purchase Agreement.
"FPA" means the Federal Power Act of 1920, as amended.
"Funding Agreement" means the Funding Agreement, dated as of
September 26, 2000, between EPEC and the Issuer.
"GAAP" means, as of any date of determination, generally
accepted accounting principles then in effect in the United States of America,
applied on a consistent basis.
"Global Bond" or "Global Bonds" collectively or individually,
as the case may be, has the meaning set forth in Section 201 of the Indenture.
"Global Bond Holder" has the meaning set forth in Section 306
of the Indenture.
"Governmental Agency" means any public legal entity or public
agency of the United States, whether created by federal, state, or local
government or any other legal entity now existing or hereafter created, or now
or hereafter owned or controlled, directly or indirectly, by any public legal
entity or public agency of the United States.
4
77
"Government Approval" means any authorization, approval,
consent, waiver, exception, license, filing, registration, ruling, permit,
tariff, certification, exemption and other action or requirement by or with any
Governmental Agency. Without limiting the generality of the foregoing, with
respect to the Issuer, Governmental Approvals shall include the approval from
the FERC pursuant to Section 205 of the FPA for the rates to be charged by the
Issuer under the Amended and Restated Power Purchase Agreement.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the Granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring proceedings in the name of the Granting party or otherwise and generally
to do and receive anything that the Granting party is or may be entitled to do
or receive thereunder or with respect thereto.
"Guaranty" of or "Guarantee" by any Person means any
obligation, contingent or otherwise, of such Person guaranteeing or having the
economic effect of guaranteeing any Indebtedness of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and including
any obligation of such Person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (b) to purchase property, securities or
services for the purpose of assuring the owner of such Indebtedness of the
payment of such Indebtedness, or (c) to maintain working capital, equity capital
or other financial statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Indebtedness; provided, however, that
the terms Guarantee and Guaranty shall not include endorsements for collection
or deposit, in either case in the ordinary course of business.
"Holder" means the Person in whose name a Bond is registered
in the Security Register.
"Indebtedness" means with respect to any Person, (a) any
liability of such Person (1) for borrowed money, or under any reimbursement
obligation relating to a letter of credit, or (2) evidenced by a bond, note,
debenture or similar instrument (including a purchase money obligation) given in
connection with the acquisition of any businesses, properties or assets of any
kind (other than a trade payable or a current liability arising in the ordinary
course of business), or (3) for the payment of money relating to any obligations
under any capital lease of real or personal property which has been recorded as
a capitalized lease obligation; (b) all redeemable stock issued by such Person
(the amount of Indebtedness represented by any involuntary liquidation
preference plus accrued and unpaid dividends); (c) any liability of others
described in the preceding clause (a) that the Person has guaranteed or that is
otherwise its legal liability; and (d) (without duplication) any amendment,
supplement, modification, deferral, renewal, extension
5
78
or refunding of any liability of the types referred to in clauses (a), (b) and
(c) above. For purposes of determining any particular amount of Indebtedness
under this definition, guarantees of (or obligations with respect to letters of
credit supporting) Indebtedness otherwise included in the determination of such
amount shall not also be included.
"Indenture" means this instrument as originally executed and
as it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Independent", when used with respect to any specified Person,
means a Person who (1) is in fact independent of the Issuer and any other
obligor upon the Bonds and of any Affiliate of the Issuer or of such other
obligor, (2) does not have any direct financial interest or any material
indirect financial interest in the Issuer or in any such other obligor or in any
Affiliate of the Issuer or of such other obligor, and (3) is not connected with
the Issuer or any such other obligor or any Affiliate of the Issuer or of such
other obligor as an officer, member employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions. Whenever it is herein
provided that any Independent Person's opinion or certificate shall be furnished
to the Trustee, such Person shall be appointed by an Issuer Order and approved
by the Trustee in the exercise of reasonable care and such opinion or
certificate shall state that the signer has read this definition and that the
signer is Independent within the meaning hereof.
"Independent Investment Banker" means Credit Suisse First
Boston Corporation or its successor.
"Interest Payment Date" means the fifteenth calendar day of
each February and August commencing on and from February 15, 2001 (or if any
such day is not a Business Day, then the next succeeding Business Day).
"Issuer" means the Person named as the "Issuer" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter "Issuer"
shall mean such successor Person.
"Issuer Request" or "Issuer Order" means a written request or
order signed in the name of the Issuer by its President or a Vice President or
the President or Vice President of [EPM] acting on behalf of the Issuer and
delivered to the Trustee.
"Issuing Bank" means, with respect to any Letter of Credit,
the bank which issued such Letter of Credit.
"Letter of Credit" means any Letter of Credit provided
pursuant to, and complying with the conditions specified therefor under, Section
503 of the Indenture.
"Lien" means any security interest, mortgage, pledge,
hypothecation, assignment, assignment in trust, deposit arrangement,
encumbrance, lien (statutory or other), or preference, priority or other
security agreement (including, without limitation, any conditional sale or other
title retention agreement, any financing lease having substantially the same
economic effect as
6
79
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code of any state of the United States or comparable law of
any jurisdiction).
"Liquidity Account" has the meaning set forth in Section 503
of the Indenture.
"Liquidity Deficiency" has the meaning specified in Section
503(b) of the Indenture.
"Liquidity Reserve Required Balance" means, as at any date, an
amount equal to the maximum interest payable in respect of the Bonds on any
subsequent Payment Date.
"Majority Holders" means Holders of not less than 51% in
aggregate principal amount of Outstanding Bonds.
"Make-Whole Premium" means an amount equal to the Discounted
Present Value calculated for any bond subject to redemption less the unpaid
principal amount of that bond; provided that the Make-Whole Premium shall not be
less than zero. For purposes of this definition, the "Discounted Present Value"
of any bond subject to redemption shall be equal to the discounted present value
of all principal and interest payments scheduled to become due in respect of
that bond after the date of this redemption, calculated by an Independent
Investment Banker using a discount rate equal to the sum of (1) the yield to
maturity on the United States treasury security having an average life equal to
the remaining average life of that bond and trading in the secondary market at
the price closest to par and (2) 50 basis points; provided, however, that, if
there is no United States treasury security having an average life equal to the
remaining average life of that bond, this discount rate shall be calculated
using a yield to maturity interpolated or extrapolated on a straight-line basis
(rounding to the nearest month, if necessary) from the yields to maturity for
two United States treasury securities having average lives most closely
corresponding to the remaining average life of that bond and trading in the
secondary market at the price closest to par.
"Management Committee" means the management committee of the
Issuer.
"Management Committee's Consent" means a copy of a consent
certified by a Responsible Officer of the Issuer to have been duly adopted by
the Management Committee and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Mandatory Debt Service" for any period means all scheduled
interest (including Additional Interest) and principal payments and fees payable
during such period in respect of the Bonds.
"Material Adverse Effect" means an event, occurrence or
condition which has or could reasonably be expected to have a material adverse
effect on (i) the business, operations, property, condition (financial or
otherwise) of the Issuer, EPEC or PSE&G, (ii) the rights or remedies of the
Trustee or Holders under the Financing Documents, (iii) the ability of any of
the Issuer, EPEC or PSE&G to perform its obligations under the Financing
Documents or the Material Agreements to which it is a party, or (iv) the
validity, enforceability or priority of the Liens on the Collateral.
7
80
"Material Agreement" means, individually, the Amended and
Restated Power Purchase Agreement, the Power Services Agreement, the
Administrative Services Agreement, the Funding Agreement, the EPEC Guaranty, the
Purchase Agreement, the EPEC Consent, the EPM Consent, and the PSE&G Consent;
collectively, the "Material Agreements."
"Maturity", when used with respect to any Bond, means the date
on which the principal of such Bond or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, notice of redemption or otherwise.
"Member" means any member of the Issuer; collectively, the
"Members" of the Issuer.
"Mesquite" means Mesquite Investors L.L.C., a limited
liability company established under the laws of the State of Delaware.
"Moody's" means Moody's Investors Service.
"Net Collections" for any period means, the excess, if any of
the (i) the sum of the Collections and the Account Transfer Payments over (ii)
any amount payable during such period pursuant to clauses (i) and (ii) of
Section 502(b).
"Newark Bay" means Newark Bay Cogeneration Partnership, L.P.,
a New Jersey limited partnership.
"Non-U.S. Person" means a Person that is not a "U.S. Person"
as defined in Regulation S and certified to the Trustee and the Registrar by
such Person.
"Notice of an Actionable Event" means (a) a certificate of any
Holder that an Event of Default has occurred or (b) whether or not any
certificate or notice thereof shall have been delivered to the Trustee, a
Bankruptcy Event of Default. A Notice of an Actionable Event has been "given"
(i) in the case of a Bankruptcy Event of Default, when such Bankruptcy Event of
Default occurs or (ii) in the case of any other Notice of an Actionable Event,
when the certificate referred to in clause (a) of the immediately preceding
sentence has actually been received by a Responsible Officer of the Trustee. A
Notice of an Actionable Event has been "rescinded" when, after a Notice of an
Actionable Event (other than a Bankruptcy Event of Default) has been given, the
Majority Holders have subsequently delivered to a Responsible Officer of the
Trustee a certificate stating that there exists no Event of Default or when,
after a Bankruptcy Event of Default, such Bankruptcy Event of Default is no
longer continuing and a Responsible Officer of the Trustee has received a
certificate to this effect from the Majority Holders or the Issuer, provided
that a Notice of an Actionable Event may not be rescinded without the consent of
the Holders of all of the Bonds unless all amounts of interest on the Bonds and
all payments on account of the principal of and Make-Whole Premium (if any) on
the Bonds (with interest on such principal, Make-Whole Premium (if any) and, to
the extent permitted by law, on overdue payments of interest, at the rates
specified herein and the Bonds with respect to overdue payments) and an
additional amount sufficient to reimburse the Holders for the
8
81
reasonable costs and expenses incurred in connection with the giving and
rescinding of any such Notice of an Actionable Event shall have been paid prior
to the entry of any judgment in respect of such amounts. A Notice of an
Actionable Event is "outstanding" at all times after such Notice of an
Actionable Event has been given until such time, if any, as such Notice of an
Actionable Event has been rescinded.
"Officer's Certificate" means a certificate signed by the
President or any Vice President of the Issuer or any of the foregoing officers
of [EPM] acting on behalf of the Issuer, as the case may be, and by the
Controller or the Treasurer or the Secretary of the Issuer or any of the
foregoing officers of [EPM] acting on behalf of the Issuer, as the case may be,
and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Issuer or EPM, acting on behalf of the Issuer, including
an employee of the Issuer or EPM, acting on behalf of the Issuer, and who shall
be acceptable to the Trustee.
"Original Power Purchase Agreement" means the Power Purchase
Agreement, dated as of June 15, 1988 between PSE&G and Newark Bay.
"Outstanding", when used with respect to Bonds, means, as of
the date of determination, all Bonds theretofore authenticated and delivered
under this Indenture, except:
(i) Bonds theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Bonds, or portions thereof, for whose payment or
redemption money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent (other than the Issuer) in trust
or set aside and segregated in trust by the Issuer (if the Issuer shall
act as its own Paying Agent) for the Holders of such Bonds; provided
that, if such Bonds are to be redeemed, notice of such redemption has
been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(iii) Bonds, except to the extent provided in Sections 1402
and 1403 of the Indenture, with respect to which the Issuer has
effected defeasance and/or covenant defeasance as provided in Article
Fourteen; and
(iv) Bonds which have been paid pursuant to Section 308 of the
Indenture or in exchange for or in lieu of which other Bonds have been
authenticated and delivered pursuant to this Indenture, other than any
such Bonds in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Bonds are held by a bona
fide purchaser in whose hands such Bonds are valid obligations of the
Issuer;
provided, however, that for purposes of Section 303 of the Indenture and for
purposes of determining whether the Holders of the requisite principal amount of
the Outstanding Bonds have given any request, demand, authorization, direction,
notice, consent or waiver hereunder or are present at a meeting of Holders for
quorum purposes, and for the purpose of making the calculations required by TIA
Section 313, Bonds owned by the Issuer or any other obligor upon
9
82
the Bonds or any Affiliate of the Issuer or of such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Bonds which the Trustee knows to be so owned shall be so
disregarded. Bonds so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Bonds and that the
pledgee is not the Issuer or any other obligor upon the Bonds or any Affiliate
of the Issuer or such other obligor.
"Paying Agent" means the Trustee or any other Person
(including the Issuer acting as Paying Agent) authorized by the Issuer to pay
the principal of or interest on any Bonds on behalf of the Issuer.
"Payment Date" means an Interest Payment Date and/or Principal
Payment Date.
"Permanent Regulation S Global Bond" has the meaning set forth
in Section 201 of the Indenture.
"Permitted Investments" means the following investments
maturing in each case, not less than one Business Day before the Payment Date
next following the date such investment is made; provided, however, that in the
case of any investment pursuant to clause (b) of this definition which is made
with the Trustee, such investment may mature on such Payment Date:
(a) any direct obligations of, or obligations fully and
unconditionally guaranteed by, the United States of America, or any
agency or instrumentality of the United States of America, the
obligations of which are fully and unconditionally backed by the full
faith and credit of the United States of America;
(b) demand and time deposits in, certificates of deposit of,
bankers' acceptances issued by, or Federal funds sold by any depository
institution or trust company incorporated under the laws of the United
States of America or any state thereof and subject to supervision and
examination by Federal and/or state authorities, or incorporated under
the laws of any other jurisdiction, so long as at the time of such
investment or contractual commitment providing for such investment the
unsecured commercial paper or other unsecured short-term debt
obligations of such depository institution or trust company have at
least the Required Credit Rating from Moody's and Standard & Poor's;
(c) repurchase obligations with respect to any security
described in clauses (a) or (b) above, in each case entered into with
either (i) a depository institution or trust company (acting as
principal) which in respect of its short-term unsecured debt has credit
ratings of at least the Required Credit Rating from Moody's and
Standard & Poor's; or (ii) a money market fund maintained by a broker
which in respect of its short-term unsecured debt has credit ratings of
at least the Required Credit Rating from Moody's and Standard & Poor's;
10
83
(d) unsecured debt securities bearing interest or sold at a
discount issued by any corporation incorporated under the laws of the
United States of America or any State thereof which have at the time of
such investment at least the Required Credit Rating from Moody's and
Standard & Poor's;
(e) unsecured commercial paper which has at the time of such
investment a rating of at least the Required Credit Rating from Moody's
and Standard & Poor's; and
(f) investments in money market funds or money market mutual
funds which have at the time of such investment at least the Required
Credit Rating from Moody's and Standard & Poor's (including such funds
for which the Trustee or any of its Affiliates is investment manager or
advisor and for which the Trustee or any of its Affiliates may receive
a fee).
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Physical Bond" or "Physical Bonds" collectively or
individually, as the case may be, has the meaning set forth in Section 201 of
the Indenture.
"Place of Payment" means, when used with respect to the Bonds,
the place or places where the principal of (and Make-Whole Premium, if any, on)
and interest on the Bonds are payable as specified as contemplated by Sections
301 and 1102 of the Indenture.
"Power Services Agreement" means the Power Services Agreement,
dated as of September 20, 2000, between the Issuer and EPM.
"Predecessor Bond" of any particular Bond means every previous
Bond evidencing all or a portion of the same debt as that evidenced by such
particular Bond; and, for the purposes of this definition, any Bond
authenticated and delivered under Section 308 of the Indenture in exchange for
or in lieu of a mutilated, destroyed, lost or stolen Bond shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Bond.
"Principal Payment Date" means the fifteenth calendar day of
each February commencing on and from February 15, 2002 (or if such day is not a
Business Day, then the next succeeding Business Day).
"Private Placement Legend" has the meaning set forth in
Section 202 of the Indenture.
"Property" means any asset, revenue or any other property,
whether tangible or intangible, real or personal, including, without limitation,
any right to receive income.
"PSE&G" means Public Service Electric & Gas Company, a
corporation organized and existing under the laws of the State of New Jersey.
11
84
"PSE&G Consent" means the Consent and Agreement, dated as of
September 26, 2000, among PSE&G, the Issuer and the Trustee.
"Purchase Agreement" means the Purchase and Sale Agreement,
dated as of September 20, 2000, between Newark Bay and the Issuer.
"QIB" means a "Qualified Institutional Buyer" under Rule 144A.
"Rating Agency" means, individually, each of Moody's and
Standard & Poor's, so long as such Persons maintain a rating on the Bonds; and
if each of Moody's or Standard & Poor's no longer maintains a rating on the
Bonds, such other nationally recognized statistical rating organization selected
by the Trustee; collectively, the "Rating Agencies."
"Redemption Date" when used with respect to any Bond to be
redeemed, in whole or in part, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price" when used with respect to any Bond to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registrar" means the Trustee, until a successor Registrar
shall have become such pursuant to the applicable provisions of this Indenture,
and, thereafter, "Registrar" shall mean such successor Registrar.
"Registration Rights Amendment" means the Registration Rights
Agreement, dated as of September 20, 2000, between the Issuer and the initial
purchasers of the Bonds.
"Registration Statement" means a registration statement with
respect to the Bonds meeting the requirements of the Securities Act.
"Regular Record Date", with respect to any Payment Date, means
the date which is fifteen (15) Business Days immediately preceding such Payment
Date.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Bond" has the meaning set forth in
Section 201 of the Indenture.
"Regulation S Physical Bond" has the meaning set forth in
Section 201 of the Indenture.
"Required Credit Rating" means A-1 (or its equivalent) or
higher from Standard & Poor's and P-1 (or its equivalent) or higher from
Moody's, as the case may be.
"Resale Restriction Termination Date" means the date which is
two years after the later of the original issue date and the last date on which
the Issuer or any Affiliate of the Issuer was the owner of a Bond (or any
predecessor Bond).
12
85
"Responsible Officer" means, with respect to any person other
than the Trustee or the Issuer, a duly elected or appointed authorized and
acting officer, agent or representative of such Person. "Responsible Officer"
when used with respect to the Trustee, means the chairman or any vice-chairman
of the board of directors, the chairman or any vice-chairman of the executive
committee of the board of directors, the chairman of the trust committee, the
president, any Vice President, the secretary, any assistant secretary, the
treasurer, any assistant treasurer, the cashier, any assistant cashier, any
trust officer or assistant trust officer, the controller or any assistant
controller or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above-designated officers, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject. "Responsible Officer" when used with respect to the
Issuer means, unless the context otherwise requires, the managing member,
president, chief executive officer, chief financial officer, vice president,
principal accounting officer or treasurer of the Issuer or any of the foregoing
officers of EPM acting on behalf of the Issuer or other executive officer of the
Issuer or EPM acting on behalf of the Issuer who in the normal performance of
his or her operational duties would have knowledge of the subject matter
relating to any certificate, report or notice to be delivered or given under the
Indenture or knowledge of any Default or Event of Default thereunder.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Global Bond" has the meaning set forth in Section
201 of the Indenture.
"Rule 144A Information" has the meaning set forth in Section
1110 of the Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as from time to time amended.
"Security Document" means, individually, the Account Control
Agreement, the Assignment and Security Agreement, the Consents and all UCC
financing statements required by this Indenture in connection with the
Collateral; collectively, the "Security Documents."
"Security Register" has the meaning specified in Section 305
of the Indenture.
"Shelf Registration Statement" means a shelf registration
statement with respect to the Bonds meeting the requirements of the Securities
Act.
"Special Record Date" for the payment of any defaulted
principal or interest on the Bonds means a date fixed by the Trustee pursuant to
Section 309 of the Indenture.
"Standard & Poor's" means Standards & Poor's Rating Group.
13
86
"Stated Maturity" when used with respect to any Bond or any
installment of principal thereof or interest thereon, means the date specified
in such Bond as the fixed date on which the principal of such Bond or such
installment of principal or interest is due and payable.
"Taxes" means any present or future taxes, duties, levies, or
other governmental charges of whatever nature.
"Temporary Regulation S Global Bond" has the meaning set forth
in Section 201 of the Indenture.
"Treasury Constant Maturity Series Yields" means the yields
reported in Federal Reserve Statistical Release H.15(519) (or any comparable
successor publication for actively traded U.S. Treasury securities).
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force at the date as of which this Indenture was executed, except
as provided in Section 1006 of this Indenture.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder.
"Trustee Fees" means the amount of fees, expenses and
indemnities due to the Trustee under this Indenture and the Fee Agreement.
"Uniform Commercial Code" or "UCC" means the Uniform
Commercial Code as in effect from time to time in the State of New York and any
other jurisdiction the laws of which control the creation or perfection of
security interests under the Security Documents.
"United States" or "U.S." means the United States of America
(including the states and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.
"U.S. Person" has the meaning ascribed to such term in
Regulation S and certified to the Trustee and the Registrar by such Person.
"U.S. Physical Bond" has the meaning set forth in Section 201
of the Indenture.
"Vice President" when used with respect to the Issuer or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "Vice President."
"Withdrawal Guaranty" has the meaning set forth in Section
503(a) of the Indenture.
14
87
EXHIBIT B
[FACE OF BOND]
CEDAR BRAKES I, L.L.C.
8.50% Senior Secured Bond Due 2014
CUSIP [_________]
No. [_______] $[_____________]
CEDAR BRAKES I, L.L.C., a Delaware limited liability company
(the "Issuer", which term includes any successor under the Indenture hereinafter
referred to), for value received, promises to pay to [_____________], or its
registered assigns, the outstanding principal sum of [WRITTEN AMOUNT]
($[amount]), on or prior to February 15, 2014 or such earlier date as this Bond
may be redeemed (the "Maturity Date"), such payment to be made in annual
installments on each February 15, and end on the Maturity Date set forth above,
each such installment to be in an amount equal to the Outstanding principal
amount on the Closing Date multiplied by the percentage set forth opposite the
applicable Payment Date on Annex A attached hereto (provided that the portion of
the principal amount remaining unpaid on the Maturity Date, together with all
interest accrued thereon, shall in any and all cases be due and payable on the
Maturity Date), and to pay interest thereon from the Closing Date or from the
most recent Payment Date to which interest has been paid or duly provided for,
semi-annually on February 15 and August 15, in each year, commencing on February
15, 2001, at a rate of 8.50% per annum, until the principal hereof is paid or
made available for payment, plus additional interest (to the extent that the
payment of such interest shall be legally enforceable) at the rate of 1.0% per
annum on any overdue principal and premium and on any overdue installment of
interest; provided, that, in the event that an Exchange Offer (as defined in the
Registration Rights Agreement) has not been made, with respect to the Bonds, on
or before the date which is two hundred and seventy (270) days after the Closing
Date or a Shelf Registration Statement (as defined in the Registration Rights
Agreement) has not been filed or declared effective within the time period
specified in the Registration Rights Agreement, additional interest shall
88
accrue on the Bonds at the rate of 0.50% per annum (such additional interest,
the "Additional Interest") from and including the date on which any such
Registration Default (as defined in the Registration Rights Agreement) shall
occur to but excluding the date on which all such Registration Defaults (as
defined in the Registration Rights Agreement) have been cured. All references to
"interest" in this Bond include Additional Interest. The interest so payable,
and punctually paid or duly provided for, on any Payment Date will, as provided
in the Indenture, be paid to the Person in whose name this Bond (or one or more
Predecessor Bonds) is registered at the close of business on the Regular Record
Date for such interest, which shall be the February 1 and August 1 (whether or
not a Business Day), as the case may be, next preceding such Payment Date. Any
such principal or interest not so punctually paid or duly provided for
(collectively, "Defaulted Payments") will forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in whose
name this Bond (or one or more Predecessor Bonds) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Payment to
be fixed by the Issuer, notice whereof shall be given by the Trustee to Holders
of Bonds not less than 10 days prior to such Special Record Date.
Reference is hereby made to the further provisions of this
Bond set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Terms used but not otherwise defined herein shall have their
meanings as defined in the Indenture. The provisions of this Bond do not purport
to be complete and are subject to, and qualified in their entirety by reference
to, the provisions of the Indenture.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to below by manual signature, this Bond shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
B-2
89
IN WITNESS WHEREOF, the Issuer has caused this Bond to be duly
executed manually or by facsimile by its duly authorized officers.
Dated:
CEDAR BRAKES I, L.L.C.
By:
------------------------------
Name:
Title:
B-3
90
CERTIFICATE OF AUTHENTICATION
Dated:
This is one of the 8.50% Senior Secured Bonds due 2014 of the
Issuer described in the within-mentioned Indenture.
Bankers Trust Company, as Trustee
By:
--------------------------------
Authorized Signatory
B-4
91
[REVERSE SIDE OF BOND]
CEDAR BRAKES I, L.L.C.
8.50% Senior Secured Bond due 2014
1. Principal and Interest.
The Issuer will pay the principal of this Bond on or prior to
February 15, 2014 in the manner set forth on the face of this Bond.
The Issuer promises to pay interest on the principal amount of
this Bond on each Payment Date, as set forth below, at the rate per annum shown
above.
Interest will be payable semi-annually (to the Holders of
record of the Bonds (or any predecessor Bonds) at the close of business on the
Regular Record Date immediately preceding the Payment Date) on each Payment
Date, commencing February 15, 2001.
Interest on this Bond will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the Closing
Date; provided that, if there is no existing default in the payment of interest
and if this Bond is authenticated between a Regular Record Date referred to on
the face hereof and the next succeeding Payment Date, interest shall accrue from
such Payment Date. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment.
The principal of, premium, if any, and interest on the Bonds
shall be payable and the Bonds shall be exchangeable and transferable at the
office or agency of the Issuer in the Borough of Manhattan, The City of New
York, maintained for such purposes (which initially shall be the Corporate Trust
Office of the Trustee) or, at the option of the Issuer, interest may be paid by
check mailed to the address of the Person entitled thereto as such address shall
appear on the Register; provided that (a) all payments with respect to the
Global Bonds and the Physical Bonds the Holders of which have given wire
transfer instructions to the Trustee by the Regular Record Date shall be
required to be made by wire transfer of immediately available funds to
B-5
92
the accounts specified by the Holders thereof; (b) the payment of the final
installment of principal of, or interest on, each Bond shall only be made upon
presentation and surrender of such Bond at the Corporate Trust office, or such
other place as may be designated pursuant to the Indenture; and (c) pursuant to
the Indenture, upon written request from any Holder of Outstanding Bonds in the
aggregate principal amount of $1,000,0000 payments of interest on, or principal
(other than the final payment of principal) of, such Bonds shall be made by wire
transfer to such Holder. The Bonds will not be entitled to the benefit of any
sinking fund.
3. Registrar.
The Trustee will act as the Registrar.
4. Indenture; Limitations.
The Issuer issued the Bonds under an Indenture dated as of
September 26, 2000 (the "Indenture"), between the Issuer and Bankers Trust
Company, as trustee (the "Trustee"). The terms of the Bonds include those stated
in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act. The Bonds are subject to all such terms and Holders are referred
to the Indenture and the Trust Indenture Act for a statement of all such terms.
To the extent permitted by applicable law, in the event of any inconsistency
between the terms of this Bond and the terms of the Indenture, the terms of the
Indenture shall control. The Indenture will not be qualified under the Trust
Indenture Act; thus Holders of the Bonds will not be entitled to the protections
provided under the Trust Indenture Act to holders of debt securities issued
under a qualified indenture.
The Bonds are general obligations of the Issuer. The aggregate
principal amount of the Bonds issued on the Closing Date is $310,600,000.
5. Optional Redemption.
The Bonds may be redeemed at the option of the Issuer, in
whole or in part, at any time and from time to time at a Redemption Price equal
to 100% of the Outstanding
B-6
93
principal amount, plus accrued and unpaid interest, if any, thereon to the
Redemption Date, plus a Make-Whole Premium.
Notice of a redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date to each Holder to be redeemed at
such Holder's last address as it appears in the Register. On and after the
Redemption Date, interest ceases to accrue on Bonds or portions of Bonds called
for redemption, unless the Issuer defaults in the payment of the Redemption
Price.
6. Denominations; Transfer; Exchange.
The Bonds are issued only in registered form without coupons
and initially only in minimum denominations of $100,000 and any integral
multiple of $1,000 above that amount; provided, however, that initial purchases
of the Bonds by purchasers who are institutional "accredited investors" who are
not Qualified Institutional Buyers shall be in minimum amounts of $250,000; and
provided further that, after initial issuance, Bonds may be issued upon exchange
or transfer in such amounts as may be necessary to evidence the entire unpaid
principal amount of any Bond surrendered or exchanged. A Holder may register the
transfer or exchange of Bonds in accordance with the Indenture. The Issuer may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Issuer need not register the transfer or exchange of any
Bonds selected for redemption (except the unredeemed portion of any Bond being
redeemed in part). Also, it need not register the transfer or exchange of any
Bonds for a period of 15 days before a selection of Bonds to be redeemed is
made.
7. Persons Deemed Owners.
A Holder may be treated as the owner of a Bond for all
purposes.
8. Unclaimed Money.
If money for the payment of principal, premium, if any, or
interest remains unclaimed for two years, the Trustee will pay the money back to
the Issuer at its
B-7
94
request. After that, Holders entitled to the money must look to the Issuer for
payment, unless an abandoned property law designates another Person, and all
liability of the Trustee with respect to such money shall cease.
9. Discharge Prior to Redemption or Maturity.
If the Issuer irrevocably deposits, or causes to be deposited,
with the Trustee money sufficient to pay the then outstanding principal of,
premium, if any, and accrued interest on the Bonds to redemption or maturity,
the Issuer will be discharged from the Indenture and the Bonds, except in
certain circumstances for certain sections thereof.
10. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Bonds may
be amended or supplemented with the consent of the Majority Holders, and any
existing default or compliance with any provision may be waived with the consent
of the Majority Holders (other than for a default in the payment of the
principal of (of Make-Whole Premium, if any) or any interest in any Bond or in
respect of a covenant or provision of the Indenture that cannot be modified or
amended without the unanimous affirmative vote of all Holder) of the principal
amount of the Bonds then outstanding. Without notice to or the consent of any
Holder, the parties thereto may amend or supplement the Indenture or the Bonds
to, among other things, cure any ambiguity, defect or inconsistency; provided
that such cure shall not materially adversely affect the interests of the
Holders.
11. Restrictive Covenants.
The Indenture contains certain covenants, including, without
limitation, covenants with respect to the following matters: (i) Indebtedness of
the Issuer; (ii) restricted payments; (iii) transactions with Affiliates; (iv)
fundamental change; and (v) compliance with Material Agreements.
B-8
95
12. Successor Persons.
When a successor person or other entity assumes all the
obligations of its predecessor under the Bonds and the Indenture, the
predecessor person will be released from those obligations.
13. Remedies for Events of Default.
If an Event of Default (other than a Bankruptcy Event of
Default) occurs and is continuing, then and in every such case the Trustee, upon
the direction of Holders of no less than 25% of the Outstanding Bonds (for an
Event of Default with respect to a default in payment of principal, premium, if
any, or interest) or the Majority Holders (for any other Event of Default),
shall declare the principal amount of all the Bonds to be due and payable
immediately, by a notice in writing to the Issuer, and, upon any such
declaration, such principal amount, any accrued and unpaid interest and all
other amounts payable under the Bonds shall become immediately due and payable.
If a Bankruptcy Event of Default occurs, the principal amount
of, any accrued interest on and all other amounts payable under the Bonds then
Outstanding shall become immediately due and payable. The Trustee may require
indemnity reasonably satisfactory to it before it enforces the Indenture or the
Bonds. Subject to certain limitations, the Majority Holders may direct the
Trustee in its exercise of any trust or power.
14. Trustee Dealings with Issuer.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Bonds and may make loans to,
accept deposits from, perform services for, and otherwise deal with, the Issuer
and its Affiliates as if it were not the Trustee; provided that no conflicting
interest results.
15. No Recourse Against Certain Others.
Except as otherwise specifically provided in the Material
Agreements, no recourse under or upon any obligation, covenant or agreement
contained in this Bond,
B-9
96
the Indenture or any Security Document, or because of any indebtedness evidenced
thereby, shall be had against any incorporator, as such, or against any past,
present or future stockholder, member, manager, officer or director, as such, of
the Issuer or of any successor, either directly or through the Issuer or any
successor, under any rule of law, statute, or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance of the Bonds by the Holders thereof and as part of the consideration
for the issuance of the Bonds. Nothing contained herein shall, however, limit
the liability of any of the foregoing for any fraud, gross negligence or willful
misconduct on their part.
16. Authentication.
This Bond shall not be valid until the Trustee manually signs
the certificate of authentication on the other side of this Bond.
17. Governing Law.
The Indenture and this Bond shall be governed by, and
construed in accordance with, the laws of the State of New York (without giving
effect to the principles thereof relating to conflicts of law except Section
5-1401 of the New York General Obligations Law).
The Issuer will furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to CEDAR BRAKES I,
L.L.C., 1001 Louisiana Street, Houston, Texas 77002, Attention: President.
B-10
97
ANNEX A to
Bond
REPAYMENT SCHEDULE FOR BOND
Percentage of Percentage of
Original Principal Original Principal
Payment Date Amount Payable Payment Date Amount Payable
------------ -------------- ------------ --------------
Feb. 15, 2002 1.8859 Feb. 15, 2009 8.7594
Feb. 15, 2003 2.5345 Feb. 15, 2010 9.9352
Feb. 15, 2004 3.5500 Feb. 15, 2011 11.2515
Feb. 15, 2004 4.9112 Feb. 15, 2012 12.6390
Feb. 15, 2006 5.7527 Feb. 15, 2013 14.2640
Feb. 15, 2007 6.6977 Feb. 15, 2014 10.0892
Feb. 15, 2008 7.7298
B-11
98
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered
Holder hereby sells, assigns and transfers unto
Insert Taxpayer Identification No.
(Please print or typewrite name and address including zip code of assignee)
the within Bond and all rights thereunder, hereby irrevocably constituting and
appointing
attorney to transfer such Bond on the books of the Issuer with full power of
substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED ON ALL CERTIFICATES EXCEPT PERMANENT
REGULATION S PHYSICAL BONDS]
In connection with any transfer of this Bond occurring prior
to the date which is the earlier of the date of an effective Registration
Statement or [_______] the undersigned confirms that without utilizing any
general solicitation or general advertising that:
[Check One]
[ ](a) this Bond is being transferred in compliance with the
exemption from registration under the Securities Act of 1933,
as amended, provided by Rule 144A thereunder.
or
[ ](b) this Bond is being transferred other than in accordance with
(a) above and documents are being furnished which comply with
the conditions of transfer set forth in this Bond and the
Indenture.
If none of the foregoing boxes is checked, the Trustee or other Registrar shall
not be obligated to register this Bond in the name of any Person other than the
Holder hereof unless and until the conditions to any such transfer
B-12
99
of registration set forth herein and in Section 307 of the Indenture shall have
been satisfied.
Date:
-----------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
Signature Guarantee:
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing
this Bond for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Issuer as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Dated:
------------------------------------------
NOTICE: To be executed by an executive
officer
B-13
100
EXHIBIT C
Form of Certificate To Be Delivered Upon Termination of
Restricted Period On or after November 6, 2000
Cedar Brakes I, L.L.C.
1001 Louisiana Street
Houston, Texas 77002
Attn: Secretary
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attn: Corporate Trust Administration
Re: Cedar Brakes I, L.L.C. (the "Issuer") 8.50% Senior
Secured Bonds due 2014 (the "Bonds")
Ladies and Gentlemen:
This letter relates to U.S. $__________ principal amount of
Bonds represented by the Regulation S Global Bond which bears a legend outlining
restrictions upon transfer of such Regulation S Global Bond. Pursuant to Section
202 of the Indenture (the "Indenture") dated as of September 26, 2000 relating
to the Bonds, we hereby certify that we are (or we will hold such Bonds on
behalf of) a person outside the United States to whom the Bonds could be
transferred in accordance with Rule 904 of Regulation S promulgated under the
Securities Act. Accordingly, you are hereby requested to exchange the legended
certificate for an unlegended certificate representing an identical principal
amount at maturity of Bonds, all in the manner provided by the Indenture.
You and the Issuer are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
--------------------------------
Authorized Signature
101
EXHIBIT D
Form of Certificate to Be Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
[___________________], 2000
Bankers Trust Company
4 Albany Street
New York, New York 10006
Attn: Corporate Trust Administration
Cedar Brakes I, L.L.C.
1001 Louisiana Street
Houston, Texas 77002
Attn: Secretary
Re: Cedar Brakes I, L.L.C. (the "Issuer") 8.50% Senior
Secured Bonds due 2014 (the "Bonds")
Ladies and Gentlemen:
In connection with our proposed purchase of $[____________]
aggregate principal amount of the Bonds:
1. We understand that the Bonds have not been and will not be
registered under the Securities Act of 1933, as amended (the
"Securities Act"), and may not be sold except as permitted in the
following sentence. We agree on our own behalf and on behalf of any
investor account for which we are purchasing the Bonds to offer, sell
or otherwise transfer such Bonds prior to the date which is two years
after the later of the date of original issue and the last date on
which the Issuer or any affiliate of the Issuer was the owner of such
Bonds, or any predecessor thereto (the "Resale Restriction Termination
Date") only (a) to the Issuer, (b) pursuant to a registration statement
which has been declared effective under the Securities Act, (c) for so
long as the Bonds are eligible for resale pursuant to Rule 144A under
the Securities Act, to a person we reasonably believe is a qualified
institutional buyer under Rule 144A (a "QIB") that purchases for its
own account or for the account of a QIB to whom notice is
102
given that the transfer is being made in reliance on Rule 144A, (d)
pursuant to offers and sales to non-U.S. Persons that occur outside the
United States within the meaning of Regulations S under the Securities
Act, (e) to an institutional "accredited investor" within the meaning
of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the
Securities Act that is acquiring the Bonds for its own account or for
the account of such an institutional "accredited investor" for
investment purposes and not with a view to, or for offer or sale in
connection with, any distribution thereof in violation of the
Securities Act or (f) pursuant to any other available exemption from
the registration requirements of the Securities Act, subject in each of
the foregoing cases to any requirement of law that the disposition of
our property and the property of such investor account or accounts be
at all times within our or their control and to compliance with any
applicable state securities laws. The foregoing restrictions on resale
will not apply subsequent to the Resale Restriction Termination Date.
If any resale or other transfer of the Bonds is proposed to be made
pursuant to clause (e) above prior to the Resale Restriction
Termination Date, the transferor shall deliver a letter from the
transferee substantially in the form of this letter to the Trustee,
which shall provide, among other things, that the transferee is an
institutional "accredited investor" within the meaning of subparagraph
(a)(1), (2), (3) or (7) or Rule 501 under the Securities Act and that
it is acquiring such Bonds for investment purposes and not for
distribution in violation of the Securities Act. We acknowledge that
the Issuer and the Trustee reserve the right prior to any offer, sale
or other transfer prior to the Resale Restriction Termination Date of
the Bonds pursuant to clauses (d), (e) and (f) above to require the
delivery of an Opinion of Counsel, certifications and/or other
information satisfactory to the Issuer and the Trustee.
2. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) purchasing for our own account or for the account of such an
institutional "accredited investor," and we are
D-2
103
acquiring the Bonds for investment purposes and not with a view to, or
for offer or sale in connection with, any distribution in violation of
the Securities Act and we have such knowledge and experience in
financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Bonds, and we and any
accounts for which we are acting are each able to bear the economic
risk of our or its investment.
3. We are acquiring the Bonds purchased by us for our own
account, or for one or more accounts as to each of which we exercise
sole investment discretion and have authority to make, and do make, the
statements contained in this letter.
4. You are entitled to rely upon this letter and you are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official
inquiry with respect to the matters covered hereby.
Very truly yours,
[Insert Name of Transferor]
By:
-------------------------------
Name:
Title:
Dated:
-------------------------
Upon transfer, the Bonds should be registered in the name of
the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
D-3
104
EXHIBIT E
Form of Certificate to Be Delivered
in Connection with Transfers Pursuant to Regulation S
[_________________], 2000
Cedar Brakes I, L.L.C.
1001 Louisiana Street
Houston, Texas 77002
Bankers Trust Company
4 Albany Street
New York, NY 10006
Attention: Corporate Trust Administration
Re: Cedar Brakes I, L.L.C. (the "Issuer")8.50% Senior Secured
Bonds due 2014 (the "Bonds")
Ladies and Gentlemen:
In connection with our proposed sale of $[_________] aggregate
principal amount of the Bonds, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended, and, accordingly, we represent that:
(1) the offer of the Bonds was not made to a person in the
United States and the proposed transferee is a Non-U.S. Person (as
defined in the Indenture pursuant to which the Bonds were issued);
(2) either (a) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we
nor any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements
105
of Rule 903(b) or Rule 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the U.S. Securities Act of 1933, as
amended.
In addition, if the sale is made during a restricted period
and the provisions of Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may
be.
You and the Issuer are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.
Very truly yours,
[Insert Name of Transferor]
By:
-------------------------------
Name:
Title:
Dated:
-------------------------
E-2
106
EXHIBIT G
Form of Guaranty
GUARANTY AGREEMENT
This Guaranty Agreement made and entered into as of [ ], 2000
(the "Agreement"), between El Paso Energy Corporation, a Delaware corporation
("Guarantor"), and Bankers Trust Company, a New York banking corporation,
("Trustee") in favor of the Holders of the Bonds (each as defined in the
Indenture referred to below).
WITNESSETH:
WHEREAS, pursuant to an Indenture, dated as of September 26,
2000 between Cedar Brakes I, L.L.C. (the "Issuer") and Bankers Trust Company, as
trustee (as amended, supplemented or otherwise modified from time to time, (the
"Indenture")), the Issuer issued $310,600,000 of 8.50% Senior Secured Bonds Due
2014;
WHEREAS, the Issuer is required, pursuant to the Indenture, to
maintain an amount in U.S. dollars equal to the interest payable in respect of
the Bonds on any subsequent Payment Date due during any subsequent semi-annual
period (the "Liquidity Reserve Required Balance");
WHEREAS, subject to the terms and conditions of the Indenture,
the Issuer is permitted to replace any amount in deposit in the Liquidity
Account with a guaranty from the Guarantor;
WHEREAS, Guarantor will derive substantial benefit from the
transfer and replacement of amounts on deposit in the Liquidity Account;
NOW, THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Guarantor does hereby agree as follows:
107
1. Capitalized terms used herein, but not defined herein,
shall have the meaning ascribed to them in the Indenture.
2. Guarantor hereby irrevocably and unconditionally guarantees
to Trustee the punctual payment, when required under Section 3 hereof,
of an amount (the "Obligations") equal to (i) the Liquidity Reserve
Required Balance minus (ii) the sum of (a) the aggregate amount of cash
deposited on the date hereof and from time to time thereafter in the
Liquidity Account and (b) the maximum amount then available to be drawn
under any Letter of Credit posted in accordance with Section 503(a) of
the Indenture. Performance by Guarantor of its obligations hereunder
shall be made in full irrespective of (but without prejudice to the
rights otherwise of Guarantor with respect to) any claim, set-off or
other right that Guarantor may have at any time against Trustee, any
Holder, or any other person or entity, whether in connection herewith
or with any unrelated transaction.
3. Guarantor agrees to fund, or cause to be funded into the
Liquidity Account an amount equal to the Liquidity Deficiency
immediately upon receipt of notice from Trustee that a Liquidity
Deficiency has occurred and is continuing.
4. The Agreement is a primary obligation of Guarantor and
shall be construed as an irrevocable, unconditional, absolute and
continuing guaranty of the full and punctual payment of all of the
Obligations and not of their collectibility only, irrespective of (i)
the validity or enforceability of the Indenture or any other agreement
or instrument relating thereto, (ii) any amplification, alteration,
amendment, variation, supplement, renewal or replacement of the
provisions of the Indenture or (iii) any other circumstances which
might otherwise constitute a legal or equitable discharge or defense of
a guarantor. This Agreement shall remain in full force and effect until
all obligations of the Issuer have been paid to the Holders, or until
such earlier time as provided for herein.
2
108
5. Guarantor hereby irrevocably waives diligence, promptness,
presentment, demand for payment or performance, protest, notice of
protest, notice of non-performance or non-payment, notice of
acceptance, notice of dishonor and any other notice with respect to any
of the Obligations and this Agreement. All payments that Guarantor is
required to make under this Agreement shall be without any set-off,
counterclaim or condition. The obligations of Guarantor shall not be
affected by any change of ownership of the Issuer or the insolvency,
bankruptcy or any other change in the legal status of the Issuer. In
the event that the performance of the Issuer's obligations under the
Indenture are stayed or performance is delayed or deferred upon the
insolvency, bankruptcy or reorganization of the Issuer, all obligations
of Guarantor under this Agreement shall remain in full force and effect
and shall become immediately due to the extent that the Issuer would
have otherwise been required to pay or perform its obligations under
the Indenture absent the stay, delay or deferral in the enforceability
of such obligations as a result of such insolvency, bankruptcy or
reorganization of the Issuer. Guarantor hereby waives any legal or
equitable defenses arising out of the insolvency, bankruptcy or similar
legal disability of the Issuer.
6. This Agreement constitutes the entire agreement, and
supersedes all prior written agreements and understandings, and all
oral agreements, between the parties with respect to the subject matter
hereof and may be executed simultaneously in several counterparts, each
of which shall be deemed an original, and all of which together shall
constitute one and the same instrument.
7. The invalidity or unenforceability of any one or more
phrases, sentences, clauses or Sections in this Agreement shall not
affect the validity or enforceability of the remaining portions of this
Agreement or any part thereof.
8. Guarantor represents and warrants to Trustee that (a) it
has the legal right to execute and deliver this Agreement and to
perform its obligations hereunder, (b) this Agreement and the
performance of Guarantor's obligations
3
109
hereunder have been duly authorized by Guarantor and constitute legal,
valid and binding obligations of Guarantor enforceable against
Guarantor in accordance with their terms and (c) neither the execution
and delivery by Guarantor of this Agreement, nor the consummation of
the transactions herein contemplated, nor compliance with the
provisions hereof will violate any law, rule, regulations, order, writ,
judgment, injunction, decree or award binding on Guarantor or the
provisions of any indenture, instrument or agreement to which Guarantor
or Guarantor's property is bound, or conflict with or constitute a
default thereunder, or result in the creation or imposition of any lien
in, of or on the property of Guarantor pursuant to the terms of any
such indenture, instrument or agreement.
9. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING
EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW EXCEPT
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
(b) The Guarantor consents to the non-exclusive
jurisdiction of any court of the State of New York or any United States
federal court sitting in the Borough of Manhattan, New York City, New
York, United States, and any appellate court from any thereof, and
waives any immunity from the jurisdiction of such courts over any suit,
action or proceeding that may be brought in connection with this
Indenture, the Security Documents or the Bonds. The Guarantor
irrevocably waives, to the fullest extent permitted by law, any
objection to any suit, action, or proceeding that may be brought in
connection with this Indenture, the Security Documents or the Bonds in
such courts whether on the grounds of venue, residence or domicile or
on the ground that any such suit, action or proceeding has been brought
in an inconvenient forum. The Guarantor agrees that final judgment in
any such suit, action or proceeding brought in such court shall be
conclusive and binding upon the Guarantor and may be enforced in
4
110
any court to the jurisdiction of which the Guarantor is subject by a
suit upon such judgment.
(c) The Guarantor agrees that service of all writs,
process and summonses in any suit, action or proceeding brought in
connection with this Indenture, the Security Documents or the Bonds
against the Guarantor, or with respect to its property and assets, in
any court of the State of New York or any United States federal court
sitting in the Borough of Manhattan, New York City may be made upon CT
Corporation System at 111 Eighth Avenue, 13th Floor, New York, NY
10011, whom the Guarantor appoints as its authorized agent for service
of process. The Guarantor represents and warrants that CT Corporation
System has agreed to act as the Guarantor's agent for service of
process. The Guarantor agrees that such appointment shall be
irrevocable so long as any of the Bonds remain outstanding or until the
irrevocable appointment by the Guarantor of a successor in New York
City as its authorized agent for such purpose and the acceptance (on
terms reasonably satisfactory to the Trustee) of such appointment by
such successor. The Guarantor further agrees to take any and all
action, including the filing of any and all documents and instruments,
that may be necessary to continue such appointment in full force and
effect as aforesaid. If CT Corporation System shall cease to act as the
Guarantor's agent for service of process, the Guarantor shall appoint
without delay another such agent and provide prompt written notice to
the Trustee of such appointment. With respect to any such action in any
court of the State of New York or any United States federal court in
the Borough of Manhattan, City of New York, service of process upon CT
Corporation System, as the authorized agent of the Guarantor for
service of process, and written notice of such service to the
Guarantor, shall be deemed in every respect, effective service of
process upon the Guarantor. Without prejudice to the foregoing, the
Guarantor hereby irrevocably consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by
the mailing of copies thereof by registered or certified mail, postage
prepaid, to the Guarantor at the address of its
5
111
principal office specified in the first paragraph of this Indenture or
at any other address previously furnished in writing to the Trustee by
the Guarantor.
(d) Nothing in this Section shall affect the right of
any party to serve legal process in any other manner permitted by law
or affect the right of any party to bring any action or proceeding
against any other party or its property in the courts of other
jurisdictions.
10. This Agreement shall remain in full force and effect or
shall be reinstated (as the case may be) if at any time any payment by
Guarantor, in whole or in part, is rescinded or must otherwise be
returned by Trustee upon the insolvency, bankruptcy or reorganization
of the Issuer, or otherwise, all as though that payment had not been
made.
11. Notwithstanding any payment or payments made by Guarantor
hereunder or any set-off or application of funds of Guarantor by
Trustee, until (i) this Agreement shall have been terminated pursuant
to Section 4 hereof or (ii) all of the Obligations and all other
amounts payable under this Guaranty shall have been paid in full,
Guarantor shall not (i) exercise any right of subrogation or indemnity,
or similar right or remedy, against the Issuer or any of its assets or
property in respect of any amount paid by Guarantor under this
Agreement or (ii) file a proof of claim in competition with Trustee for
any amount owing to the Guarantor by Issuer on any account whatsoever
in the event of the bankruptcy, insolvency or liquidation of Issuer.
12. The rights and remedies set forth in the Indenture and
this Agreement are in addition to and not exclusive of any rights and
remedies available to Trustee by law in respect of this Agreement.
13. Guarantor shall pay or reimburse Trustee on demand for all
reasonable costs and expenses (including fees and expenses of counsel)
incurred in connection with the enforcement of Trustee's rights under
this Agreement.
6
112
14. All amendments, waivers and modifications of or to any
provision of this Agreement and any consent to departure by Guarantor
from the terms hereof shall be in writing and signed and delivered by
Trustee and, in the case of any such amendment or modification, by
Guarantor, and shall not otherwise be effective. Any such waiver or
consent shall be effective only in the specific instance and for the
purpose for which it is given.
15. This Agreement shall be binding on Guarantor and its
successors and assigns. However, Guarantor shall not transfer any of
its obligations hereunder without the prior written consent of Trustee
and any purported transfer without that consent shall be void. This
Agreement shall inure to the benefit of Trustee and its successors and
assigns.
16. Any notice, request, demand, or statement which either
Guarantor or Trustee may desire to give the other shall be in writing
and shall be considered as duly delivered when mailed by certified mail
or delivered against receipt by messenger or overnight courier
addressed to said party as follows:
(a) If to Guarantor:
El Paso Energy Corporation
1001 Louisiana Street
Houston, TX 77002
Attention: General Counsel
With electronic mail copies to:
Sullivant@epenergy.com
(b) If to Trustee:
Bankers Trust Company
4 Albany Street
New York, NY 10006
Attention: Manager, Project Finance
7
113
IN WITNESS WHEREOF, Guarantor has caused this Agreement to be
executed in its name and behalf.
EL PASO ENERGY CORPORATION
By:
-------------------------------
AGREED AND ACCEPTED AS OF
September 26, 2000 BY
Bankers Trust Company
By: BANKERS TRUST COMPANY
By:
------------------------------
Name:
Title:
8